Story and photos by Timothy Scott
There are plenty of real estate investment destinations in Latin America where you will find extravagant homes and celebrity sightings, but no spot has the breadth of high-end homes as Los Cabos, on the Baja Peninsula of Mexico.
Ocean Blue World magazine is run by the head of the local Engel & Völkers real estate office and this glossy lifestyle publication has no problem finding celebrities to put on its covers. From Margot Robbie to Charlize Theron, Ryan Gosling to George Clooney, the issues are a parade of A-list entertainers and business tycoons who frequently visit or live part-time in Los Cabos.
Some of these high-profile visitors have sprawling mansions on a golf course, others villas by the sea with their own infinity pool. Some prefer a penthouse in a condo building where an elevator whisks them up away from camera shutters. Others like the "residence within a luxury hotel complex" concept at a resort like Las Ventanas, Esperanza, or Palmilla. No wealthy buyer is hurting for choices when they go house-hunting here.
"There's nothing like this market anywhere else," says Vanessa Fukunaga, publisher of the magazine and President of Engel & Völkers Los Cabos, the region's top luxury real estate broker long known as Snell Real Estate. That's a boast you hear in a lot of destinations, but it's hard to think of any oceanfront stretch of land like this one. The corridor between the start and end of luxury coastal developments here extends for more than 20 miles and is still a work in progress. It's not unusual to see a new development here that's hundreds of acres, rising up from where there was nothing before—even oceanfront. "Many of our wealthiest buyers already have three, four, or five homes in different places, but here we can easily find them their dream house," she says.
If luxury buyers want a 10-bedroom home on a golf course or a villa with sunset views from the swimming pool, there's plenty to choose from in Los Cabos. What really sets this area apart is that new options are going up every month. I count 12 major construction projects going on just between downtown Cabo San Lucas and the Le Blanc Resort & Spa where I'm staying. One of the most ambitious is Solaz Los Cabos, right next door. This sprawling complex contains 128 Luxury Collection hotel rooms, a variety of condo types, and whole-floor units of 2,900 indoor square feet going for $2.55 million to $2.8 million.
Chuck Lorhman of Snell Real estate is not trying to be humorous or ironic when he describes these $2.8 million whole-floor condos facing the ocean as a deal. "I don't know of any new oceanfront development of this quality where you can get into this kind of large luxury residence for this price," he says. "These units are a terrific value."
I hear this "terrific value" phrase again when I tour Rancho San Lucas, a construction project that will surround a Greg Norman golf course and boast estate homes going for $2 million and up, plus smaller single-family villas at a lower price point. In a sign of how much land is still undeveloped in this region, the Rancho San Lucas mini-city will eventually contain a large hotel, timeshares, homes, pools, retail, and golf course on 834 acres.
I'm spending a few days exploring the luxury real estate scene of Cabo San Lucas, San Jose del Cabo, and points in between on my fourth trip to this region. Each time I come here there seem to be more projects under construction, along with new records set for the highest sale price garnered so far. So what attracts buyers to this market besides the sea and sunshine?
Busts, but Mostly Booms in the Los Cabos Real Estate Market
As many homeowners and professional house flippers were reminded during the last global financial crisis, real estate prices don't automatically go up every year. Any location that relied on American buyers saw either a dip or an outright crash a decade ago and southern Baja real estate was no exception. Then just as things were kicking into high gear again, Hurricane Odile roared through in 2014 and caused tremendous destruction. Some major hotels were closed for 6-12 months to clean up the mess and reopen. At several points, cartel-related violence put Baja in the news for the wrong reasons, though as this article goes to press the local efforts to combat crime seem to be working. Tourism and home sales are both up bigtime in 2018.
There's no denying that this is the most expensive part of Mexico for real estate. For those vacation home buyers or retirees moving to this desert beach climate from California, Vancouver, Aspen, or New York City though, the housing prices in Los Cabos will probably feel like a great value. You get more room for the money, but that's just the start of it. With labor and material costs being reasonable, you often get an upgraded level of finishes and amenities in Los Cabos than you can to the north, but with more professionalism in the construction than you sometimes see in other parts of Latin America.
"The investors I work with who are looking to buy here are very happy with the quality of what they get for their money," says Valentino Sartev at VanSirius Real Estate. "I have worked on several multi-million-dollar deals where someone bought a piece of land and turned it into something spectacular a year or two later." Valentino got a good feel for the market while working with the local Coldwell Banker group, then struck out on his own as a trustworthy local realtor who could match wealthy buyers and developers with the right contacts or opportunities. "We have a functioning MLS system here, which is a big advantage over most Mexican cities," he says. "There are many properties that aren't on the market though, especially with raw land or hotels for sale, so the right connections are important if you're looking for a specific kind of high-dollar development investment."
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