The definitive guide · 2026 edition
Cabo Real Estate
Buying property in Cabo as a foreigner — fideicomiso, closing costs, neighborhood pricing, STR yields, the branded-residence boom. Updated with the latest from our daily market scrape.
Last updated 2026-05-30
Why now
Cabo real estate, late 2020s edition
Three forces are reshaping Cabo property right now: brand-name buyers (Tom Brady in Diamante, Glen Powell in Quetzal, Stephen Curry in Pacifica) have anchored Pacific-side pricing 30-50% below traditional Pedregal Pacific while delivering similar quality; branded residences (Four Seasons, Aman/Amanvari, Soho House Cabo, Park Hyatt) are landing year after year and bringing the Aspen-style fractional and whole-ownership pricing curve with them; and STR (short-term rental) yields on premium villas continue to clear 8-12% net even as resort inventory grows.
See our Q2 2026 State of Cabo Luxury Real Estate report for the actual numbers — median ask prices by community, $/sqft, days on market, and the trend lines we're tracking.
For foreigners
Yes, you can own property as an American. Here's how.
Fideicomiso (bank trust). Mexican law restricts foreign ownership in the "restricted zone" (within 50 km of any coastline — i.e., all of Cabo). Foreigners purchase via a 50-year renewable trust held by a Mexican bank on your behalf. You have full beneficial ownership — you can sell, will, gift, and rent the property freely. The bank charges ~$500-1,000/year as trustee.
Corporation route. Alternative path: form a Mexican corporation that owns the property. Used for investment properties (multiple units, commercial) where the corp setup is justified by scale. Simpler than it sounds — ~$2,000 setup, ~$1,500/year maintenance.
Closing costs (~5-8% of purchase price). Includes: ISAI tax (2-4%), notary fees (~1%), fideicomiso setup fees ($2,000-4,000), title insurance ($500-2,000), bank trustee permission fees (~$1,500), property tax (predial) proration. We have a notario partner network we recommend.
Capital gains on sale. ISR (Mexican capital gains) currently caps at 35% on the gain, but most foreigners qualify for the primary-residence exemption (~$700K USD lifetime exemption for individuals). Tax treaty with the US allows credit for Mexican tax paid against US capital gains tax.
By community
Where buyers are actually buying
Pedregal Pacific. The trophy market. $5-25M+. Cliffside Pacific-facing inventory is supply-constrained — no new construction sites. If you want an iconic Cabo home and don't care about per-sqft, Pedregal Pacific is the answer.
Palmilla. Established family market. $2-10M. Swimmable beach access (rare in Cabo) drives stable demand. Long-time second-home owner demographic.
Cabo del Sol. Resort-front, golf-anchored. $1.5-6M. Lower volatility than Pedregal, broader buyer pool.
Costa Palmas (East Cape). The growth story. Aman branded residences launching with the August 2026 hotel opening; Four Seasons already trading. Branded-residence pricing premium runs 30-50% above unbranded comparable. Pre-construction Aman villas were 8-figure entry points.
Cabo Pacifica (Quetzal, Maravilla, Diamante). The brand-name buyer market. Pacific-facing oceanfront at 30-50% discount vs Pedregal Pacific. 90-minute drive north of San José del Cabo airport is the friction.
Puerto Los Cabos / San José del Cabo. Lower-priced entry point. $800K-2.5M. Arts-district adjacent, quieter, slower appreciation but more accessible.
STR economics
Renting your villa out — the math that actually matters
Gross yields. Premium villas (4-8 BR, $1,500-3,000/night) typically generate $200-400K gross annually. Bachelorette and family-reunion bookings are the volume driver.
Net after costs. Property management (15-25% of revenue), housekeeping, utilities, repairs, marketing, transient occupancy tax, depreciation. Net yields cluster around 5-9% of purchase price for well-managed premium villas.
Booking channel mix. Direct concierge channels (us and a few competitors) deliver the highest-rate guests. Airbnb skews lower-rate but higher volume. Onefinestay / Plum Guide / Inspirato deliver premium guests at a 20-30% commission.
Holding cost. Predial (property tax) is famously cheap — even multimillion-dollar Cabo properties often pay <$5K/year in property tax. HOA fees in gated communities run $500-2,500/month. Mexican income tax on rental income runs ~25-30% after deductions.
FAQs
Common questions
Can Americans actually own property in Mexico?
What's the total closing cost?
Is now a good time to buy?
What about Aman / Four Seasons / Soho House residences?
STR yields in Cabo?
Do I need a Mexican lawyer?
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Related guides & articles
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