The real estate market in Baja California Sur remains resilient, though it is marked by significant competition, which has altered the dynamics from the peak years of 2021 and 2022. In those years, sellers enjoyed brisk sales with relatively less competition. However, in 2024, the landscape has changed considerably.
Sellers are now faced with the challenge of selling in a more competitive market with approximately 30% fewer units going under contract compared to the previous high years.
Buyers, on the other hand, are encountering a broader inventory, including a higher number of new construction properties compared to resale units.
This shift towards new constructions, while providing more choices, also means that turnkey-ready properties are less abundant than some buyers might prefer.
Nonetheless, the market is expected to see an increase in available turnkey-ready properties in the coming years as current construction projects reach completion, promising excellent opportunities for buyers.
As 2024 is a dual election year, with significant political events in both Mexico and the United States, these elections are anticipated to influence the real estate market dynamics.
Historically, the U.S. elections have had a positive impact on the real estate market in Baja California Sur. Having observed this trend over four election cycles, it is reasonable to expect that the post-election period will bring a favorable boost to the market.
This anticipation is based on the pattern that has been observed previously where the conclusion of U.S. elections typically instigates increased activity and investment in the Baja California Sur real estate market.
In terms of active transactions, the market is diverse, covering various property types including commercial properties, condos, fractional ownership properties, houses, land, and multifamily units.
However, instead of saturating you with numbers, I will give you the most important and then I will make a few remarks.
In the first semester of 2024, we had 1998 new listings and a sales volume of $2.6B USD; pending: 611 units and $590M USD, and 935 units were closed for $671M USD, with 97% list to the sale price and an average of 252 days on market.
Nearly 60% of the pending and closed were in Los Cabos, 9% in East Cape, 15% in La Paz, and 16% in the Pacific side; 50% more inventory came to the market that went under contract in 2024.
Remarks
The most interesting observation from the detailed real estate data for Baja California Sur in 2024 is the diverse and robust nature of the market, highlighting specific trends and opportunities across different regions. Here are some key insights:
1. High Sales Volume and Market Confidence in Cabo Corridor
The Cabo Corridor leads with a high number of active, pending, and closed transactions. The significant sales volumes and near-perfect list-to-sale ratio (99%) suggest strong market confidence and high demand for properties in this area. The average sales price of $592,268.57 is indicative of the premium nature of real estate in this corridor, making it a hotspot for luxury investments.
2. Cabo San Lucas: Balanced Market with High Activity
Cabo San Lucas shows robust activity with substantial sales volumes across all transaction stages. The balance between active, pending, and closed transactions, coupled with a 98% list-to-sale ratio, indicates a healthy market. The moderate average sales price of $430,057.90 suggests a broad appeal to various buyer segments, from mid-range residential to commercial investors.
3. San Jose del Cabo: Premium Market with High Returns
San Jose del Cabo stands out for its high average sales price ($935,771.86) and a solid list-to-sale ratio (95%). This area’s higher price point and significant sales volumes reflect its status as a premium market, ideal for luxury residential developments and high-end investments. The shorter average days on the market (177 days) compared to other regions indicate quick sales and strong demand.
4. East Cape: Emerging Hotspot with High Potential
East Cape’s substantial sales volume in active transactions ($552,418,058.00) and near-perfect list-to-sale ratio (98%) highlight its emerging status as a high-potential investment area. The average sales price of $375,263.93 and longer average days on the market (365 days) suggest a niche market with opportunities in eco-tourism and beachfront properties. Investors looking for growth potential and unique investment opportunities should consider East Cape.
5. La Paz: Strong Demand and High Affordability
La Paz exhibits a high demand for properties, reflected in a 101% list-to-sale ratio, meaning properties often sell above their listed prices. This, combined with an average sales price of $359,049.72, indicates a strong and affordable market suitable for a wide range of investments, including affordable housing and commercial developments. The significant number of transactions further supports La Paz’s appeal as a growing urban center.
The diverse real estate market in Baja California Sur offers various opportunities tailored to different investment strategies. The Cabo Corridor and San Jose del Cabo are ideal for luxury and high-end investments due to their high sales volumes and premium property prices.
Cabo San Lucas presents balanced opportunities across residential and commercial sectors. East Cape is emerging as a valuable niche market with potential in eco-tourism and beachfront properties. La Paz’s strong demand and affordability make it a compelling choice for broader investment options, including affordable housing and commercial projects.
These insights underscore the dynamic nature of Baja California Sur’s real estate market in 2024, showcasing areas with high potential returns and diverse investment opportunities. For investors, understanding these trends and regional specifics can guide strategic decisions and maximize returns.
As you can read, the real estate market in Baja California Sur for 2024 presents a complex yet promising landscape. Increased inventory and competition, a shift towards new constructions, and the influence of political events are shaping the market dynamics.
Historical trends suggest a positive post-election market boost, particularly following the U.S. elections. The diverse range of active, pending, and closed transactions across various regions and property types underscores the market’s vibrancy and potential. Buyers and investors are presented with numerous opportunities, especially as new constructions come to completion, providing more turnkey-ready properties.
The market’s resilience and adaptability to changing conditions continue to make Baja California Sur a compelling destination for real estate investment.
Do you want to know more? Contact me @nickfong_ronival and @ronivalrealestate on Instagram and listen to The Nick Fong Podcast on your favorite audio platform or on YouTube.
