Your Easy Guide to Buying Property in Cabo San Lucas & San José del Cabo
So, you’ve fallen in love with Los Cabos. Maybe it was the endless sunshine, the ocean views, or those perfect margaritas at sunset—but now you're thinking, “How do I buy a place here?” Whether you’re dreaming of a beachfront condo, a golf course villa, or a vacation rental that pays for itself, this guide will walk you through what it’s really like to buy real estate in Cabo San Lucas and San José del Cabo.
First Things First: Yes, Foreigners Can Own Property in Mexico
A lot of people get nervous when they hear that foreigners can’t technically own land near the coast in Mexico. That’s true—but there’s a workaround that’s been used for decades. It’s called a Fideicomiso, or Mexican Bank Trust.
If the property is within 50 kilometers of the coast (which most things in Cabo are), a bank holds the title to the property on your behalf. You still have full rights—you can sell it, rent it out, pass it on to your kids, whatever. The bank is just the legal title holder. It’s super common and totally secure. Think of it like a long-term lease with full ownership rights.
Picking the Right Area: Cabo vs. San José
Before diving into listings, it’s worth deciding which part of Los Cabos is right for you.
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Cabo San Lucas is vibrant, tourist-friendly, and full of nightlife, resorts, marinas, and new developments. If you want to be near the action, this is your spot.
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San José del Cabo is a little more chill, artsy, and residential. It has a historic downtown, farmers markets, and a more laid-back vibe. Great for full-time living or those looking for a quieter escape.
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The Corridor (the stretch between Cabo and San José) is full of high-end communities, golf courses, and gated neighborhoods. Perfect for luxury homes and privacy.
Step-by-Step: The Buying Process
Now let’s walk through the buying process, from browsing homes to getting the keys.
1. Find a Real Estate Agent You Trust
Seriously, this is key. Cabo and San José are full of beautiful properties, but you want someone who knows the area, understands the legal stuff, and can help you avoid any sketchy situations. Look for an licensed agent like Joe Taylor who understand the local market, knows the best schools and communities, and has strong relationships througout Cabo San Lucas and San Jose del Cabo.
2. Get Pre-Qualified or Set a Budget
Most buyers in Cabo pay with cash, especially expats. Mortgage options exist for foreigners, but they’re limited and often come with higher interest rates. Some developers offer financing, but it's not like the 30-year fixed you’re used to in the U.S. If you're planning to finance, talk to a lender early.
If you're buying with cash, make sure your funds are ready to be wired when the time comes.
3. Shop Around & Make an Offer
Once you find the right place—whether it’s a beach villa, golf home, or oceanfront condo—your agent will help you make a written offer. This usually includes a deposit (typically 5–10%) held in escrow.
The seller will accept, reject, or counter your offer just like they would in the States or Canada.
However in our market you have a due dilligence period (often 5-15 business days) where during that period if you are having doubts about the transaction you can pull out of the deal and have your deposit returned.
4. Hire a Closing Attorney (Optional)
While not required, having a closing attorney ensures your interests are protected. They’ll help review contracts, confirm property ownership, check for liens, and guide you through the legal side of the deal.
5. Set Up the Fideicomiso or Corporation
If you’re buying in the restricted zone (near the coast), your attorney or agent will help set up the Fideicomiso through a Mexican bank. This can take a few weeks. If you're planning on buying multiple properties or renting them out as a business, you might also consider forming a Mexican corporation.
6. Title Search & Due Diligence
During this phase, the notario (a government-appointed lawyer who finalizes real estate deals) will ensure the property is free of debts, back taxes, or legal issues. Your attorney will double-check everything for peace of mind.
7. Pay Closing Costs
Closing costs usually run about 4-6% of the purchase price. This includes:
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Acquisition tax (about 3%)
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Notary fees
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Bank trust setup and first-year fees
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Legal fees
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Title insurance (optional, but smart)
Annual bank trust fees typically range between $500–$1,000 USD.
8. Sign, Pay, & Take Possession
Once all the paperwork is in order, you’ll sign the deed at the notary’s office, wire the remaining balance, and boom—you’re a Cabo property owner. Congrats!
What About Property Taxes?
Good news: Mexico’s property taxes are low compared to the U.S. You’ll pay around 0.1% of your property’s assessed value annually. So if you buy a $500,000 home, you’re looking at roughly $500 a year.
Even better: If you pay your taxes early (in December or January), you’ll get up to 25% off. And if you're a senior citizen with permanent residency, you may qualify for additional discounts with an INAPAM card.
Can You Rent It Out?
Absolutely! Vacation rentals are a big business in Cabo. Whether you're using Airbnb or a local property manager, many buyers offset their costs (or even turn a profit) by renting their homes when they’re not using them. Just make sure to factor in HOA rules and maintenance costs.
A Few Bonus Tips
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HOA fees: If you're buying in a gated community or condo complex, there will likely be monthly HOA dues. These cover things like security, landscaping, and amenities.
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Utilities: Water and electricity are usually affordable, but if you’re running A/C all day in the summer, costs can climb.
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Title insurance: Not mandatory, but smart—especially if you’re buying a resale home.
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Insurance: Home insurance is available and surprisingly inexpensive in most areas.
Wrapping It Up
Buying real estate in Cabo or San José del Cabo isn’t as complicated as it might seem—especially if you have a solid agent and legal team in your corner. With a little planning and the right team, you can be sipping cocktails on your own terrace in no time.
Whether you’re planning a permanent move, looking for a vacation spot, or investing in the rental market, the Baja lifestyle is tough to beat. Between the weather, the food, the beaches, and the real estate opportunities, there’s a reason more and more people are calling Los Cabos home.
