A Perspective of Land and Investment in Cabo
When I first arrived in Cabo San Lucas in 1981 years as a young boat captain, I had no idea of the growth & development phenomenon I was about to witness and become a part of for the next 38 years. Cabo was just a small fishing village then of about 4500 people, with only 1 public phone, 3 or 4 small grocery stores and only 5 hotels in the entire area. Most of the tourism was from sport fishing and the economy revolved around an Oct-May marlin season and the money it brought in. There was a small Expat community in Cabo then, a few of them had been here since the 60’s, but most were relatively new to the area. It was a fairly inexpensive place to live in the early 80’s, especially if you learned to eat the local foods, fresh fish & produce from the local boats & ranches. Land was also very cheap, and except for the immediate area around the newly dredged marina, most of the town and development we see today was just fields and empty desert.
By 1984 there was a noticeable change in the tempo of tourism in Cabo, and for the first time more fishermen began bringing their wives and families to stay at the local hotels to enjoy the area with them while they were out fishing. Suddenly, there were more people walking around town shopping at the sundry shops during the day, when previously it had almost been like a ghost town until the fishing boats had returned to the docks late in the afternoon. Silver jewelry & trinket shops started popping up along the marina boulevard and side streets, vendors began to roam the beaches, and pretty soon several new bars and restaurants opened that began to draw large crowds in the evenings. The beginning of the Cabo we know today had started, and very few of us were prepared for the wild ride we were about to experience as Cabo roared to life with development, unlike anything anyone had ever seen before
Land was cheap back then, really inexpensive, and if any of us had realized the scope of the growth that was about to happen, we would have sold or hocked everything we had and bought land. Although in hindsight it would have been a great investment, buying land in the 80’s was still an intimidating process due to the general confusion and lack of understanding most Americans had in purchasing Mexican real estate. The occasional horror stories of people who lost their money or trying to buy land were enough to give most people pause before investing in property. There was no Google Search then, no way to fact check or find out how to do Mexican real estate law worked, no professional brokers to guide you, so our lack of understanding and access to technology prevented most of us from making a fortune.
Fortunately things changed quickly over the next few years and by the late 80’s and a few reputable real estate offices started to open with people who were confident enough in navigating the legal paperwork that helped get the real estate market moving in the right direction. By the early 90’s the real estate market really took off as more tourists ured into the area and started buying vacation homes in small developments that began blossoming around Cabo and the Corridor area. In those days, the average lots in a nice development were only $15 to 25 thousand dollars and you could build a three bedroom 2500 sq ft house for under a 100k. There were also many opportunities to buy large parcels of land just outside of town where much of the development is today. Land could be easily bought for under $1 per square meter, less than 1/100th of its current value.
Many of the local families who were original homesteaders in Cabo from the 1800’s, owned huge tracts of land near the coastal areas that they once considered useless because it wasn’t good grazing land for their cattle or goats. As the 90’s progressed, many of these went from goat ranchers to millionaires selling their once useless land to developers who quickly put up new housing and resort developments. There were also several pioneering Americans & families from mainland Mexico who had purchased large parcels of ocean front land in the 60’s and 70’s and built the first hotels in the area like Palmilla, Hotel Cabo San Lucas, Hacienda, Twin Dolphins, Solmar & Finisterra. As the 90’s passed into the new millennium, most of the original families & development pioneers who foresaw the potential of Cabo reaped great rewards by holding onto their land and then selling it to eager investors. Most of the most prestigious developments in Cabo today are now built on their former land and hotel sites, and those families fortunes were made on their foresight & belief in the future of Los Cabos
Even though an incredible amount of development has been accomplished that has made Cabo into the amazing high-end destination it is today, in the big picture the area is still relatively young and there are still incredible investment opportunities for those with foresight. Huge swaths of undeveloped land still lie in the path of the future development along the coasts of both the Pacific and Sea of Cortez , where many new high end residential & resort developments will soon be built. Amazingly, many of these properties are still available at relatively low cost, owned by the same ranchers, and just waiting for the next generation of inspired investment pioneers that will take Cabo to the next level in this century.
By: Greg Willis, greg@loscabosagent.com, https://greg.findcabohouses.com/