Los Cabos, the Most Expensive City in Mexico

 Los Cabos, the Most Expensive City in Mexico


The Mercer Human Resources firm released their latest study on the cost of living in 42 cities of Mexico. Los Cabos ended up in the first place, followed by Cancun, Monterrey, Mexico City and Cuernavaca. Los Cabos is also Mexico’s tourist destination with the highest hotel room rate average, at $532 USD per night. Yes, there are decent hotels with $40 USD per night, but there are others over $1,000 USD per night.

Rents in commercial units in downtown areas of both Cabo San Lucas and San Jose del Cabo have seen huge increases in the last month. Some of these were driven by timeshare developments who’d pay whatever for a unit in high traffic area. 

Prices in real estate, both luxurious and middle class have also skyrocketed, and gentrification has also increased prices of rentals in some neighborhoods. The influx of foreigners with higher income has also affected lower income neighborhoods. 

Then we have the case of essential goods, which have always been more expensive in Southern Baja than in other parts of Mexico. Although there are many farms in the state, most of the goods are exported to the U.S., Japan and Europe. The same happens with seafood. Plus, most of the goods we consume here need to be trucked from Northern Baja or shipped from the mainland via ferry boats, or flown in, which increases the price of everything. 

The Mercer firm evaluated 42 cities across Mexico, using Mexico City as reference, which was assigned 100 points in the ranking. 182 products and services grouped into housing, food, public transportation, education, entertainment, clothing, shoes, personal care, electronics and health were compared.

Housing is the highest expense at 44.3 percent of income, followed by education with 20.33 percent and food with 12.6 percent. Entertainment represents only 9.3 percent of income. 

The most expensive cities ended up ranked as follows: Los Cabos (107), Cancun (106), Monterrey (103), Mexico City (100) and Cuernavaca (97). As for the least expensive, the list is Tlaxcala (75), Zacatecas (77), Tepic (77), Guanajuato (77) and Tuxtla Gutierrez Chiapas (78).