Legal Requirements for Renting Out Your Property in Los Cabos, Mexico
Karla & Erick | Cabo Realty | Century 21 Paradise Properties
Can a U.S. owner legally rent out a home in Los Cabos? Yes. Foreign owners who hold their property through a fideicomiso can rent it out short-term or long-term, and in practice the process is simpler than many buyers expect. If you rent on Airbnb or Vrbo, the platform automatically withholds income tax (ISR) and VAT (IVA). Your HOA’s rental rules are usually what matters most day to day. Long-term rentals are often handled directly between owner and tenant, with requirements that depend on what both sides agree. This guide separates what the law requires from how renting actually works locally, for owners from California, Texas and Arizona.
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| Auto Platforms withhold taxes for you |
ISR + IVA The taxes withheld on platform bookings |
| 4% BCS lodging tax on short stays |
HOA Rules can limit or ban short-term rentals |
| Item | What the Rules Say | In Practice |
|---|---|---|
| HOA rules | Binding for every owner in the community | The rule that matters most: some HOAs ban short stays or set minimum nights |
| Taxes on Airbnb/Vrbo | Rental income is taxable in Mexico | The platform withholds ISR and IVA automatically from each payout |
| RFC (tax ID) | Registering lets you declare income and get lower withholding | Without one, platforms withhold at a higher rate; many owners get one through an accountant |
| Lodging tax | 4% in Baja California Sur on short stays | Ask your accountant or property manager how it’s handled for your bookings |
| Municipal or tourism permits | No specific vacation-rental permit is in force in Los Cabos today; rules are under review | Not usually requested from individual owners |
| Long-term lease paperwork | A written lease protects both sides | Documents asked of tenants depend on the owner: some ask for references and a deposit, others are more flexible |
| Insurance | Not mandatory | Recommended: make sure your policy covers rental use |
| Topic | Short-Term (Airbnb, Vrbo) | Long-Term Lease |
|---|---|---|
| Contract | Platform terms | Written lease (contrato de arrendamiento) |
| IVA | Applies to lodging | Unfurnished residential leases are generally exempt; furnished ones may not be |
| Lodging tax | 4% in BCS | Generally not |
| HOA | Often restricted | Usually allowed |
Not sure which fits you? Read Short-Term or Long-Term Rentals: What Works Best in Los Cabos.
Vacation rentals are under more scrutiny in Los Cabos. In July 2026, the local timeshare developers’ association estimated around 8,000 vacation-rental properties in the destination and called for stricter rules on permits and safety. Mexico City already requires hosts to register and caps how many nights a home can be rented. Owners in Los Cabos should expect more rules, so setting up correctly from the start is the safest approach.
For rates, withholding and how U.S. owners handle Mexican rental income, see Rental Income Tax for Foreigners in Los Cabos. Looking for a rental-friendly area? See Top Airbnb Communities in Cabo San Lucas and Can You Rent or Do Airbnb in Puerto Los Cabos?
Yes. Owners with a fideicomiso can rent short-term or long-term. The main things to respect are the HOA rules and taxes, which platforms withhold automatically.
It’s recommended. Without an RFC, platforms like Airbnb still withhold taxes, but at a higher rate. An accountant can get one for you.
Income tax (ISR) and VAT (IVA), which platforms like Airbnb withhold, plus Baja California Sur’s 4% lodging tax.
Yes. Many HOAs set minimum stays or ban short-term rentals. Check the rules before you buy.
Today there’s no specific vacation-rental permit in force in Los Cabos, and individual owners aren’t usually asked for one. Rules are under review, so it’s worth checking with a local accountant from time to time.
It depends on the owner. Some ask for references, ID and a deposit; others are more flexible. A written lease is always a good idea.
We help owners from California, Texas and Arizona find homes where renting is allowed and connect them with local accountants and property managers.
Sources: Riviera Maya News, “Vacation Rental Platforms Align with New Mexican Tax Rules for 2026” (Mar 2026); El Contribuyente, lodging tax rates by state 2026; Tribuna de México, timeshare developers on Airbnb in Los Cabos (Jul 2026); El Momento BCS on Mexico City’s rental rules (Nov 2024). Information verified October 2026.
Disclaimer: This is general information, not legal or tax advice. Rules change; confirm with a Mexican attorney and accountant. Karla & Erick are MLS members with Century 21 Paradise Properties.
Karla & Erick | Cabo Realty | Century 21 Paradise Properties
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