Homes for Sale in Cabo San Lucas & San José del Cabo

Homes for Sale Across Baja California Sur

Cabo real estate market

I have a lot of developers reach out to me, even with some of the harsh predictions I've made about many of these new projects. There was a developer from Mexico City who called me last week asking what I thought about a certain area here in Los Cabos for a new development. It was clear he had already done his due diligence. I told him about two projects that had tried to get started and couldn't get enough sales to move forward. I also mentioned another project that had recently launched in the area. He was already familiar with it. One thing we discussed was the projected delivery timeline. The new project is advertising an 18-month delivery schedule. I told him, "I'll make you a bet. Let's double that timeline to 36 months, put $500 on it, and I guarantee I win." He started laughing. I said, "I don't know why you guys keep trying to do these projects." Then I joked, "I'm actually thinking about starting a company that raises money specifically to finish all the developments that developers can't complete." He laughed again. After that, he asked me what I thought about pricing and some other details. Of course, he knows I'm probably not going to spend a lot of time helping him with pricing when the project is listed with another brokerage, but he wanted my opinion nonetheless. And the biggest thing I told him is that this is not the same market it was five years ago. Buyers today are much more educated. They've seen delays. They've seen projects struggle. They've seen developers run out of money. They're asking tougher questions and doing more due diligence than ever before. The reality is that launching a project isn't the hard part anymore. Finishing it is. Developers who are relying on the same assumptions that worked five years ago may be in for a rude awakening. Today's buyers have options. They can buy resale. They can buy completed inventory. They can buy projects that are nearly finished. So if you're asking buyers to take on the risk of pre-construction, there needs to be a compelling reason to do so. The market has changed, and developers need to recognize that.