As the third trimester of the year came to a close, Los Cabos set a new record for an increase in home prices overly a yearly period. Overall the prices of homes in Los Cabos increased by a little over 14%. Proving that the local real estate market in the region has shaken off the COVID blues.
Americans are, without a doubt, the biggest buyers in the Los Cabos real estate market. So much so that prices for Cabo homes are usually directly displayed in dollars rather than Mexican pesos. It’s widely believed that Americans are flocking to Cabo to purchase second homes because they find better deals on homes than what’s available on the California coast.
Home Prices In Los Cabos Are More Affordable Than They Are In Southern California
Americans on the West Coast are the ones that are mostly flocking down to Cabo. This is due to the proximity between southern California and the Baja California Sur resort town. A SoCal resident that wants to purchase a home in New Port Beach or Laguna Beach in California would have to pay north of 3 million dollars on average, according to real estate site Zillow.
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Those same folks could get a Cabo home for around 1 million to 2.5 million dollars. Cabo homes in that particular price range tend to offer more luxury add-ons and amenities than potentially more expensive homes in California beach cities. Prices for homes in both Los Cabos and Los Angeles in California have increased by about the same amount. That can be taken as another positive for Cabo homes since Americans we’ll be able to purchase a less expensive asset that’s increasing in value at the same rate that a home in the U.S. would.
Living Costs Are Also Cheaper In Los Cabos Than They Are In Southern California
It’s not just that buying a second home in Los Cabos is cheaper than doing so in Southern California. Living expenses in both cities are not necessarily comparable. According to Livingcost.org, the cost of living for a family of 4 in Newport Beach is almost twice as expensive as it is in Los Cabos. With a family of 4 in Newport Beach spending 2381 dollars a month without rent. That same family would have to spend 1347 to live in Los Cabos. These numbers may be hit in miss since they don’t take into account certain variables that may be important to some families. Still, the gap is certainly significant.
More Affordable Amenities Also Drive People To Los Cabos
Part of those living costs that are maybe not properly factored in the data that we presented above have to do with amenities and services. Particularly when it comes to the upkeep of the second homes that Americans would be looking to purchase. For example, having a housekeeper in the LA area is going to set a homeowner back 30 to 60 dollars an hour. The same service in Cabo would cost around 40 to 60 Mexican pesos an hour. Some service providers in Cabo are increasing their prices, but you won’t be paying more than 10 dollars an hour to most housekeeping or home service providers.
You Still Have Access To Luxury Housing
The fact that, on average, homes are less expensive in Los Cabos doesn’t mean that they are poorly built or designed. In fact, there’s an argument to be made that it’s easier to build a truly personalized luxury home in Los Cabos because the area features laxer building codes than most US cities.
Speaking of luxury homes, Los Cabos features the most expensive luxury property in Mexico currently on the market. It’s a home built on a cliff that overlooks the sea of Cortez. It is known as El Cielo 2, and the current asking price is 90 million dollars. Of course, not all luxury homes in Los Cabos cost that much. It’s just a perfect example that there’s essentially something for everyone in the region. Which isn’t necessarily the case in most U.S. resort towns.
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