Here’s The Real Reason Your Cabo Vacation Rental Is So Expensive: Real Estate Has Skyrocketed 80%

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If you’ve been browsing Airbnb, Vrbo, or long-term rental sites for an upcoming Cabo vacation, you’ve likely experienced a moment of pure “sticker shock.” The prices for monthly snowbird rentals and even one-week vacation condos seem to have exploded, pushing $2,400, $5,000, or even $10,000 a month.

It’s not your imagination, and it’s not just seasonal price gouging. The real reason your vacation rental is so expensive is that Los Cabos is in the midst of a staggering, underlying real estate boom that is transforming the destination.

Here at The Cabo Sun, we’re diving into the data to show you what’s happening on the ground and how this local housing crisis is directly impacting your vacation budget.

The Shocking Statistic: An 80% Price Surge

The core of the issue is that the cost of all housing in Baja California Sur has skyrocketed. According to a recent bill presented to the state Congress, local housing prices in the state have risen more than 80% in just four years.

This isn’t a small, gradual increase; it’s a hyper-inflationary surge. As state representative Alondra Torres García recently stated, “Today, renting or buying costs more than in many parts of Mexico City, but local incomes don’t make it affordable.” This surge is fueled by a massive influx of foreign investment, a wave of digital nomads, and the destination’s sheer popularity, all combining to create intense gentrification.

The “Two Markets” Driving Up Your Cost

This local housing crisis is the invisible engine driving up the prices of your vacation rental. While the data from the state congress reveals that the average local rent in Baja California Sur has hit a staggering 26,715 pesos (about $1,450 USD) per month, this figure actually hides the true cost for a tourist.

Travelers are now competing in two different, and very expensive, markets:

1. The Short-Term Vacation Rental (Airbnb/Vrbo): As property values and local long-term rents skyrocket, property owners are passing these costs (plus a significant premium) onto the short-term vacation market. The $550/month local rent in a peripheral neighborhood has no relation to the $150-$300/night rate for a tourist-ready condo in a prime location.
2. The “Snowbird” Monthly Rental: This market is where the 80% spike is most painfully felt. A 2-bedroom condo in a desirable area that might have rented for $1,800/month a few years ago is now listed for $3,000, $4,000, or more for the winter season.

What You Should Really Expect to Pay in 2025-2026

While local reports mention $1,450/month average rents, this is not what a tourist or snowbird will pay. Based on current listings, here is the realistic budget you should expect for a monthly rental in a desirable area:

• The “Budget” Tier (Studio/1-BR): Expect to start around $2,400 to $3,900 per month ($80 – $130 per night).
• The “Luxury” Tier (2-3 BR/Ocean View): These properties, which are the most in-demand for snowbirds, can easily range from $5,000 to over $10,000 per month.

Low monthly rental rates for seasonal properties are becoming very difficult to find.

This price surge affects all travel. As vacation rentals become more expensive, they push more travelers back to all-inclusive resorts, which in turn allows those resorts to raise their prices due to increased demand. It’s a cycle that has contributed to rising costs across the entire destination.

The Savvy Traveler Takeaway

The days of finding a “cheap” long-term rental in Cabo for the winter are, for the most part, over. The destination has firmly shifted into a high-demand, luxury market, and the prices now reflect that.

The “deal” is no longer about finding the lowest price; it’s about securing any good property at all. For snowbirds, this means you must book your winter rental 6 to 12 months in advance. For weekly vacationers, it means understanding that the high price of your Airbnb is not a one-off—it’s the “new normal” in one of the world’s most popular, and increasingly expensive, destinations.