When you think of Los Cabos real estate, most people picture Cabo San Lucas nightlife, world-class golf in Palmilla, or celebrity estates perched along the coastline. But just beyond the busy tourist corridors lies a community that combines serenity with high investment potential: El Encanto de La Laguna on the East Cape of San Jose del Cabo.
This boutique, beachfront neighborhood has become a favorite among investors and second-home buyers seeking homes in Cabo for sale that balance rental income with long-term appreciation.
If you’ve considered Palmilla Cabo real estate or luxury enclaves in Cabo San Lucas, you’ll want to explore why El Encanto might be the smartest move for your portfolio.
Why El Encanto Attracts Investors
Unlike saturated communities like Palmilla, where pricing often exceeds $10M USD, El Encanto offers a unique blend of luxury real estate in Cabo and attainable entry points. Properties here range from $1.3M condos to $6.9M beachfront villas, giving investors flexibility depending on their strategy.
Key benefits include:
- Limited inventory – Fewer homes mean higher exclusivity and stronger appreciation potential.
- High rental demand – Vacationers love boutique communities near San Jose del Cabo’s quiet beaches.
- Lower holding costs – Compared to Palmilla Cabo houses, HOA fees and maintenance are often more manageable.
- Growing demand for East Cape – As tourists and expats look beyond Cabo San Lucas, the East Cape is booming.
El Encanto vs. Palmilla Cabo Real Estate
Palmilla has long been the gold standard for luxury real estate in Cabo. Its gated enclaves, Jack Nicklaus golf course, and prestige attract celebrities and business elites. But for investors, Palmilla’s ultra-high price tags mean longer timelines to see ROI.
El Encanto, on the other hand, offers:
- Faster rental absorption – Travelers seeking a quiet, authentic Cabo experience often prefer boutique resorts.
- Room for appreciation – While Palmilla is fully established, El Encanto is still growing. Buying now means capturing future gains.
- Proximity to East Cape adventures – Sportfishing, surfing, and diving are all close, making the community highly marketable to vacation renters.
Think of Palmilla as the “trophy purchase,” while El Encanto is the up-and-coming market with major upside potential.
Types of Properties That Drive ROI
1. Beachfront Villas
Large estates, like the $6.9M Villa 7, La Laguna, draw high nightly rental rates ($2,500–$4,500). Ideal for high-net-worth investors.
2. Luxury Condos
Options like the $2.39M Brisas del Mar or $1.39M Olas 302 provide strong rental potential, especially for families and digital nomads.
3. Land for Custom Builds
With parcels like Predio El Rosario at $1.5M, investors can design properties tailored to rental markets or resale.
The Rental Market in Los Cabos
The Cabo Mexico real estate market thrives because it caters to both short-term tourists and long-term expats.
- Vacation rentals – Cabo enjoys over 60% annual occupancy rates. During holidays and winter, that spikes to 80–90%.
- Digital nomads – More remote workers seek luxury condos with ocean views and reliable internet.
- Destination weddings & retreats – Beachfront villas double as event venues, commanding premium rental fees.
For example, a 3-bedroom condo purchased for $1.3M can generate $120K–$150K annually in gross rental income, depending on occupancy. Villas often earn much more.
Market Appreciation: Los Cabos Homes
Over the past decade, Los Cabos homes have steadily appreciated due to:
- Rising tourism numbers – Over 4 million visitors annually.
- Limited land supply – Beachfront property is finite.
- Stable government policies – Mexico encourages foreign investment in coastal real estate.
- U.S. and Canadian buyer demand – The weak peso compared to the dollar makes properties attractive.
Investing in El Encanto today is like buying into Palmilla 15 years ago—before prices skyrocketed.
Real-World Example
Consider John and Lisa from Texas. They bought a 2-bedroom condo in El Encanto for $1.35M in 2021.
- They rent it out for $650/night during high season.
- Annual rental income: $110,000 gross.
- Net ROI after expenses: ~6%.
- Current market value (2025): $1.65M.
That’s appreciation plus cash flow—making their purchase both a financial and lifestyle win.
Lifestyle Still Matters
While numbers drive investments, lifestyle seals the deal. Living in El Encanto means:
- Daily sunrise views over the Sea of Cortez.
- Minutes from San Jose del Cabo’s art district.
- Private pools, spas, and expansive terraces in most homes.
- Quiet beaches without tourist crowds.
It’s not just a property—it’s a piece of paradise that renters are willing to pay top dollar for.
The Future of Cabo Mexico Real Estate
With infrastructure expansion, new resorts on the East Cape, and increasing international recognition, the demand for homes in Cabo for sale is only going up.
Investors who buy now in El Encanto are well-positioned to capture this growth before the market reaches Palmilla-level pricing.
Is El Encanto the Right Investment?
If you want a property that delivers lifestyle perks and long-term financial benefits, El Encanto de La Laguna is an excellent choice. Compared to Palmilla Cabo houses or Los Cabos Corridor mega-mansions, El Encanto balances affordability, exclusivity, and future growth.
we specialize in helping clients find the best opportunities in Los Cabos real estate. From luxury villas to beachfront condos, our team will guide you every step of the way.
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