Everything $1M+ buyers need to know about the market, the communities, and the process - from The Terry Team, powered by Windermere Los Cabos. "Luxury is more than a residence."
Los Cabos' luxury market just had its strongest year in over a decade. In 2025, the region recorded $1.59 billion in total real estate sales, a 12% increase year-over-year, and properties priced above $1 million accounted for roughly 80% of total dollar volume in the most recent reporting quarter. If you're considering a purchase above the $1 million mark - whether a Pedregal cliffside estate, a Diamante fairway villa, or a Querencia family compound - this guide is built to answer the questions you actually have, in the order you'll actually need them.
Why Los Cabos' $1M+ Market Is Different in 2026
The short answer: scarcity is protecting luxury values even as the broader market recalibrates. Los Cabos real estate in 2026 is best understood as three distinct markets moving at different speeds, not one market moving together.
The luxury tier (roughly $1M and above) remains structurally stable. Buildable oceanfront and ocean-view land in the established corridor communities is finite, and construction/replacement costs alone now anchor pricing at $500 to $1,000+ per square foot in the top communities. That scarcity is showing up at the very top of the market: sales above $10 million jumped from a single transaction in the first quarter of the year to nine transactions totaling over $160 million in the following quarter alone.
The mid-market ($500K-$1.5M condos) is seeing more inventory and more negotiating room. This is good news if your search includes turn-key condos in this range - you have more leverage than buyers did two years ago.
Geographically, San José del Cabo is leading growth. It captured the largest share of 2025 sales volume (over $711 million), ahead of Cabo San Lucas ($374 million) and the Pacific Coast corridor ($277 million), driven by continued infrastructure investment and its slightly lower entry point relative to the Cabo San Lucas corridor.
The takeaway for a $1M+ buyer: you're not trying to time a dip. You're trying to secure a scarce asset in a market where the right property - not the right month - is the real variable.
The Communities Defining Cabo's $1M+ Market
Not every luxury buyer wants the same thing. Here's how the top communities differ, so you can narrow your search before you ever get on a plane.
Pedregal
Cabo San Lucas' original hillside enclave, carved into the cliffs above the Pacific with sweeping views of the Land's End arch. Pedregal appeals to buyers who want walkability to the marina and downtown energy balanced against a private, gated, guard-staffed community. Expect a mix of legacy villas and fully modernized estates.
Diamante
Home to two of the world's top-ranked golf courses (Tiger Woods' Diamante and Davis Love III's Dunes Course), Diamante on the Pacific side draws buyers who want dramatic dune-and-ocean topography, resort-caliber amenities, and a newer development cycle with more contemporary architecture.
Querencia
An established, family-oriented private club community on the Sea of Cortez side, built around a Tom Fazio golf course and a full slate of wellness and social amenities. Querencia tends to attract buyers thinking multi-generational or long-term primary residence rather than a purely seasonal property.
Palmilla
One of the original master-planned luxury communities in the corridor, anchored by the One&Only Palmilla resort. Palmilla suits buyers who want resort infrastructure, a protected swimmable beach, and long-standing resale liquidity.
Chileno Bay & Quivira
Chileno Bay pairs a Auberge-managed beach club with one of the corridor's few truly swimmable beaches; Quivira, on the Pacific side near Land's End, offers dramatic oceanfront golf and newer high-rise and villa product. Both suit buyers prioritizing branded-resort services alongside ownership.
Puerto Los Cabos & Cabo del Sol
Puerto Los Cabos, on the San José side, combines a working marina, golf, and lower entry prices than the Cabo San Lucas corridor - consistent with San José's broader growth story this year. Cabo del Sol, closer to the middle of the corridor, offers established golf and beach-club access with strong long-term rental demand.
Buying as a Foreign National: The Fideicomiso, Explained
Mexico's constitution restricts direct foreign ownership of land within 50 kilometers of the coastline - which covers essentially all of Los Cabos' luxury real estate. That does not mean foreigners can't own beachfront property. It means they own it through a fideicomiso, a bank trust that gives the foreign buyer all the rights of ownership - to occupy, lease, sell, renovate, and pass the property to heirs - while a Mexican bank holds legal title as trustee.
In practice, the process looks like this:
- Offer and closing agreement. Once terms are agreed, a Mexican real estate attorney or notary (notario público) is engaged to handle the transaction.
- Trust application. The buyer applies for a permit from Mexico's Ministry of Foreign Affairs (SRE) to establish the fideicomiso; this typically takes a few weeks.
- Bank trustee setup. A Mexican bank is named trustee and holds title on the buyer's behalf under a renewable 50-year trust, renewable indefinitely.
- Closing. The notario public formalizes the transfer, registers it with the Public Registry of Property, and the buyer receives full beneficiary rights under the trust.
Closing costs in Mexico are typically higher than in the U.S. - commonly cited in the 5-7% range of the purchase price, covering acquisition tax, notary fees, trust setup and annual bank fees, and registration. Your agent and closing attorney should walk through the exact figure for your specific transaction before you're under contract.
Is Los Cabos Still a Good Investment in 2026?
For the $1M+ segment specifically, the case remains strong for three reasons that go beyond simple appreciation: continued scarcity of buildable oceanfront land in the established corridor, sustained tourism demand supporting short-term rental income for owners who choose to lease part-time, and continued infrastructure investment - new roads, hospital expansion, and airport capacity - concentrated in San José del Cabo. None of that guarantees short-term price movement, and buyers should treat any real estate purchase as a long-term decision, not a trade. But the structural demand drivers behind Los Cabos' luxury tier are not showing signs of softening.
Frequently Asked Questions
Can foreigners own beachfront property in Los Cabos?
Yes. Foreign buyers cannot hold direct title within 50 kilometers of the coastline, but they can own property through a fideicomiso - a Mexican bank trust that grants full ownership rights (use, lease, sale, inheritance) while the bank holds legal title as trustee. It's a standard, well-established structure used by the large majority of foreign buyers in Los Cabos.
What is a fideicomiso?
A fideicomiso is a renewable 50-year bank trust that allows a non-Mexican citizen to purchase restricted-zone property (including all coastal Los Cabos real estate). The buyer is the trust's beneficiary with full rights to occupy, rent, sell, or will the property to heirs.
How much does a luxury home cost in Los Cabos?
Replacement and land-scarcity costs put most luxury communities at roughly $500 to $1,000+ per square foot, with ultra-luxury transactions above $10 million becoming markedly more common in 2026 - nine such sales closed in a single recent quarter, compared with one in the prior quarter. Entry-level luxury (roughly $1M-$2M) is available in condo and villa product in communities like Puerto Los Cabos and parts of Cabo del Sol; estate-level pricing in Pedregal, Diamante, Querencia, and Chileno Bay typically starts well above that.
Which Los Cabos community is best for a $1M+ buyer?
It depends on lifestyle priorities more than budget. Pedregal suits buyers who want walkable proximity to the marina and downtown; Diamante and Quivira suit golf- and dune-view-focused buyers on the Pacific side; Querencia and Palmilla suit buyers prioritizing family amenities and long-term residence; Puerto Los Cabos and Cabo del Sol offer a lower entry point with strong rental fundamentals.
What are closing costs when buying property in Los Cabos?
Budget approximately 5-7% of the purchase price for closing costs, which typically include acquisition tax, notary and legal fees, fideicomiso setup and annual trustee fees, and property registration. Your closing attorney will confirm exact costs before you sign a purchase agreement.
Is now a good time to buy luxury real estate in Los Cabos?
For buyers focused on the $1M+ tier, timing the market matters less than securing the right property - inventory in the top communities is scarce and does not sit long. Buyers with more flexibility in the $500K-$1.5M condo range currently have more negotiating leverage than in prior years, as inventory in that segment has grown.
About The Terry Team
This guide was written by The Terry Team, powered by Windermere Los Cabos - a multi-generational family real estate team built around one belief: "Luxury is more than a residence." The Terry Team has collectively closed over $1 billion in real estate, guided by four commitments - Trust, Dedication, Results, and Style. We specialize in the $1M+ segment across Pedregal, Diamante, Querencia, Palmilla, Chileno Bay, and the rest of the Los Cabos corridor. As a bilingual, cross-border team, we guide U.S. and Canadian buyers through every step of a Mexican property purchase - from the fideicomiso trust to closing - and provide concierge-level, relationship-driven service for both buyers and sellers in this market.
Ready to Explore Los Cabos' $1M+ Market?
Buying: Browse our current collection of luxury listings across Pedregal, Diamante, Querencia, Palmilla, and the rest of the corridor, or schedule a private consultation with The Terry Team to define your search before you arrive.
Selling: If you own property in this market, request a complimentary Comparative Market Analysis from The Terry Team. With ultra-luxury activity accelerating and inventory tight in the top communities, well-positioned properties are commanding strong attention right now.
Contact The Terry Team: Todd@bajacabo.com | +1 (254) 292-0119
- The Terry Team, powered by Windermere Los Cabos
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