The recovery in U.S. luxury home prices, mainly in California, is driving a market rebound down the coast in one of the most popular second-home destinations for American buyers—Los Cabos, Mexico. According to a recent report by The Wall Street Journal, the luxury real estate market in Cabo is in the midst of a remarkable revival.
The article reports that after stalling in the wake of the U.S. housing crash and last year’s Hurricane Odile, developers of the some of the world’s most luxurious resorts are moving into Los Cabos. The southernmost tip of the California Baja Peninsula has always been a top destination for U.S. and Canadian travelers as well as luxury vacation home buyers. Part of its appeal is its close proximity, with direct flights daily from major North American cities, including two-hour flights from L.A. and Orange County.
The Wall Street Journal reports that sales were up 18% in 2014 and that prices at the top end of the market are averaging around $1,300 to $1,400 a square foot, up as much as 40% since 2010.
“The high end of the market is showing a lot of movement,” says The Agency’s Christopher Miller who directs sales and marketing efforts for Del Mar Real Estate, which represents homes within the exclusive Del Mar Los Cabos resort communities of Villas Del Mar, Espiritu and Oasis Palmilla.
“We’ve sold nearly $24 million dollars worth of real estate since the start of 2015, including a $9 million sprawling hillside custom home and a brand new model home in Espiritu, which was listed for $7.15 million,” Christopher adds.
Featured in The Wall Street Journal article is Villa 703, a nearly 5,916-square-foot, fully furnished residence in Villas Del Mar offering spectacular ocean views, private infinity-edged pool, dual master suites, wine cellar and an elevator, listed for $7.5 million.
As the article notes, the demographic of buyers in Los Cabos has changed, echoing the shift in wealth in the U.S. “It used to be the market was mostly retirement age buyers using their nest egg to buy a vacation home. Now we see younger, ultra-high-net-worth individuals with young families, and home styles are changing to reflect that,” Christopher says. New homes at Espiritu offer family-friendly designs, larger outdoor spaces, family rooms and higher bedroom counts.
“Another element that’s driving this upper market is a shift away from the more traditional Mexican home designs and furnishings,” Christopher says. “The younger demographic is bringing a desire for more transitional and contemporary design.”
Del Mar’s new Espiritu Estate homes, including the newly completed Estate 16, feature a blend of classic style and modern design. Its newest enclave, The Ledges at Espiritu, the first offering of its kind at Del Mar Los Cabos, features more contemporary residences and penthouses with modern design highlights and finishes.
The programming and lifestyle elements of resort communities like Del Mar Los Cabos are also expanding their family offerings to attract buyers. “Homeowners tell us if their kids are happy, they’re happy. Del Mar created a robust kids and teens program with a daily kid’s club, sports and beach activities, movie nights and other programming that give kids the opportunity to meet other kids,” Christopher explains.
“The luxury buyer comes down to Los Cabos for the lifestyle,” he adds. “They’re looking for a place for the family to unwind, connect and make lasting memories.” And as The Wall Street Journal reports, Los Cabos is back on top as one of the world’s coveted luxury vacation home destinations.
For more information on luxury real estate in Los Cabos, contact Christopher Miller at CMiller@TheAgencyRE.com.
Read the full Wall Street Journal article here.