Los Cabos Residential Real Estate Market Report 2023 Q1
2023 Q1 Market Report
April 6, 2023
The dawn of 2023 saw the Market hit the gas again, with Q1 coming in just over $500m in sales volume vs. $279m in 2022 Q4. Sales volumes are up by 48%, with 545 houses and condos sold. The $2m to $5m price point remains the market hot spot with $145m and 44 houses and condos sold. Of that, over half were pre-construction sales. Pre-construction remains sought after, with 50% of the unit volume and 40% of the dollar volume in Q1 going to pre-construction sales.
In Q1, the physical inventory has held with new listings replenishing sales. Pre-construction continues to dominate inventory, with over half of all MLS listings being pre-construction. There is also an emerging shortage of houses at particular price points, with very little pre-construction coming to fill that need. Refer to the new table “House Inventory,” where only 27% of the pre-construction house inventory is in the $400k to $1m range. Almost all of this inventory is in El Tezal in the developments of Duara, Rivieri, Casa Adobe, Punta Mirante, Damiana and the remaining builds in Cabo del Mar Ecopark. Many of these developers are releasing in phases, so more inventory will come. Unlike the glut of pre-construction condos going up everywhere, houses will continue to be in short supply – holding up prices for completed houses for the foreseeable future.
Existing properties continue to move briskly as sellers and their agents are feeling out prices in the Market. Properties accumulating significant days on the Market are making price reductions or contemplating a reduction. Please refer to the last page for notable price reductions for existing properties sold in 2023 Q1.
LOS CABOS MARKET DIRECTION
Clients regularly ask about price direction in Los Cabos. We see demand remaining strong in Los Cabos, with prices beginning to soften for completed properties. Buyers are pushing back on completed property price levels and have taken to either spectating on the sidelines or taking their chances on pre-construction.
NEW IN THIS REPORT – DAYS ON MARKET CORRECTION
We apologize to the followers of our report for a recent discovery about our MLS system’s data regarding Days on Market. The Days on Market statistics in our previous reports have been inaccurate due to a flaw in the calculation in the MLS system. Days on Market in MLS continues to clock days after a property is under contract until it closes. The MLS system’s software is originated in the US, so accumulating an extra 7-14 Days on the Market until close may be inconsequential. In Los Cabos, closes typically range from 60 to 90 days and have been much higher than that in 2021 and 2022. This extra time was distorting our reporting of Days on Market. In this report and all future reports, Days on Market is calculated as Under Contract Date minus Listing Begin Date. All related historical Days on Market stats have been updated.
ABOUT THIS REPORT
This report is produced using BCS MLS Data. It is limited to the Los Cabos Municipality apart from overlaps on the East Cape and Pacific Zones. Around Los Cabos, there is also significant activity that happens off MLS. These tend to be significant high-end developments that have their own way of marketing. These developments include The Cove Club, Chileno Bay, El Dorado, Montage, Maravilla, and Costa Palmas. As a result, this report is not a complete view of all real estate activity in Los Cabos. This report also does not report on land sales. Land sales also took off in the past two and a half years for both individual building lots and developer parcels.
All sales data in this report is based on the Under Contract Date. This is the date when the sale was consummated but not the date when the sale closed, and the title was transferred. Market reports published by other brokers and agents will typically use the Sold (or Closed) Date, which can be up to six months after the Under Contract Date. We feel using the Under Contract Date better represents market activity and timing. Consequently, prices and price volumes will not be entirely accurate until the closed date when the sold price is reported in MLS. In our current Market, with properties selling with very little off from the list, this difference is inconsequential.