Construction Costs in Cabo San Lucas, Mexico

With such a hot real estate market and limited inventory right now, potential buyers and investors are exploring every option here in Baja California Sur. Some buyers prefer to buy an existing home, while others prefer to buy a pre-construction unit from a developer in order to get a discount. But what about those who are thinking about buying land and building their own place? Let’s get into pricing, how to vet construction companies, and every other factor you should be taking into account.

There are many things to consider if you want to build in Baja. Is the home going to be for you or is it for investment or rental purposes? Are you looking for a commercial lot to build condos or a retail location? Does the lot (or terreno in Spanish) have access to municipal water and electricity? What is the property zoned for? How high can you build? What percentage of the land you are purchasing can be built upon and what percentage needs to be kept as “green space”? Is the land ejido? If the land is an ejido, you will generally want to steer clear of it, as obtaining the title can be a headache. Who is the current owner? Once you have cleared up these questions with your agent and attorney, the next question is: How much does it cost to build a home here in Baja?

This is also a moving target, as many factors are involved. What type of soil/terrain does the lot have? Is the lot on a slope or an incline? If the lot has a steep slope, extra costs like a retaining wall might be involved. Are you looking at high end finishes or entry level finishes for the property? What style of building are you looking for – a traditional Mexican casa or a new contemporary and modern look? Be sure to look at previous work that the construction company has done in Los Cabos. If they don’t have completed projects to go tour or look at, that is a major red flag. It’s a good idea to get multiple bids for a job and let each company know that you are receiving multiple quotes for the anticipated work.

With all these factors taken into consideration, let’s provide some baseline numbers. Generally, construction costs will start out at $130 per square foot. Outside areas like patios will generally start out at $35 per square foot. Do you want to add a pool? Installing a pool will usually start at $85 a square foot to build out. At the high end, construction costs could be as high as $180 per square foot, all things being equal. Anything higher than that and you are in the baller budget range, which is not uncommon in our luxurious slice of paradise here in Los Cabos. One last thing – make sure to ask your agent if they are being compensated for using a specific builder. This is very common here, but many agents will not be upfront about it.

These numbers will give you a solid idea of what your estimated building costs will be in the Baja. If you need any help finding land or finding a construction team, feel free to reach out. I would love to help you turn your dream project into a reality. Contact Fletcher Wheaton, a real estate advisor based in Cabo San Lucas, Mexico.