2016 Year In Los Cabos Real Estate
Carol S. Billups, Cabo Realty Pros
How’s the market? It’s a question I’m frequently asked, and that I love to answer. In particular, looking at the year in review is a great way to take a snapshot look at trends. So here are some of the highlights of real estate ’16, but first let’s get past the usual disclaimers. The statistics I’m presenting here were taken from the FLEX MLS system, which is the official system used by the real estate community in Baja Sur. Although it is used state-wide I limited the data to the cities of San Jose del Cabo, Cabo San Lucas, and the tourist corridor that connects them. The corridor is split into two sections, roughly in the middle with eastern half creatively entitled “San Jose Corridor” and its western counterpart known as the Cabo Corridor. Although the data is considered reliable, there may be some ommissions due to agent input error. For this report ‘sold’ will refer to closed sales in which the property has changed hands. We might also reference ‘pending’ deals in which an offer has been accepted but the sale is not complete. All data was collected on December 30, 2016 covered the calendar year 2016. So, disclaimers done let’s look at that data.
First, it was a good year. In 2016 we sold over a quarter of a billion dollars – up an astonishing 33% over the prior year. But before we begin celebrating, it bears looking at history. I’ve been doing this report for four years now and the chart below shows the market’s performance over time. As you can see, 2015 was not a great year and this year’s gains put us just about up to the sales volume of 2014. Why? Hurricane Odile. In 2015 many hotels were closed for repair which severely limited the number of prospective buyers for real estate. So 2016’s gains were really just us getting back to normal, not a phenomenal surge in demand. Sales were most brisk on the eastern half of the area, with the San Jose Corridor nearly doubling the volume of the previous year.
|Zone||Sold 2013||Sold 2014||Sold 2015||Sold 2016||Change This Year||Change 2015/14|
|Cabo San Lucas||$45,659,093||$53,391,093||$30,175,091||$33,435,050||+10%||-44%|
What types of properties were best sellers in 2016? Condominiums are very slightly more popular than single family houses, with building lots lagging far behind. But, that makes perfect sense when you consider that property values have still not recovered to the point that you can build a home for less than you can buy a finished property. For example the median cost per square foot for single family homes in 2016 was just $120 USD – and that’s generally furnished! This has pushed the prices on building sites to below the levels of a decade ago; but the gap between building and buying is closing, which will spur the interest in bare land. At this point investing in a building lot, especially with an excellent ocean view and in a desirable area, is beginning to make sense.
Speaking of affordability, some people keep perpetuating the myth that one part of Los Cabos is more affordable than others. Let’s use the median price to check that out. Bear in mind, this is the point at which half the sales are above and half below, but it seems to be the industry standard measurement. Here are the 2016 numbers by area and property type.
|Cabo San Lucas||$627,500||$348,000||$120,000|
As you can see, San Jose is not the most affordable area, rather the Cabo Corridor is home to the most attainable properties. But which part of town is only a part of the budget equation. Cabo San Lucas has a higher median single family home price because many of those posted on the MLS were in Pedregal where the median home price is $837,500. Similarly, the prices on the San Jose Corridor were pushed up by the activity in extremely high end developments such as Chileano Bay and Querencia.
So that’s the year in a nutshell. So how does 2017 look so far? Well, it’s taken me nearly two months to have time to put this brief report together, which should tell us something. I’m thinking this year is going to be very, very good for Los Cabos.
Carol Billups is Broker/Owner of Cabo Realty Pros, a full service real estate agency in Cabo San Lucas. Their website is www.caborealtypros.com. She can also be reached at firstname.lastname@example.org or by phone at 044-624-147-7541 or (760) 481-7694 from the US or Canada.