People in 15 towns in the mountainous region of Baja California Sur state have been cut off as flood waters reached up to 1.5 metres after John's heavy rains caused the Iguagil dam in Comondu to overflow its banks, but no deaths have been reported.
Mexican President Vicente Fox has visited the region to survey the damages and rescue operations, meet with local political leaders and businessmen and visit one of the region's emergency shelters.
The US National Hurricane Centre in Miami says John has remained just barely strong enough to be classified a small tropical storm, with sustained winds having dropped to 65 kilometres per hour.
But it has also warned that northwestern Mexico could get up to 15 centimetres of rainfall, and up to 25 centimetres in isolated areas, possibly causing dangerous flash floods and mud slides in the mountains.
John was located over the mountainous middle of the Baja California peninsula about 50 kilometres northwest of Santa Rosalia and is moving northward.
It is expected to further weaken into a tropical depression as it heads toward southwestern US.
John hit shore on the peninsula's southern tip Saturday as a Category 2 hurricane after tracking Mexico's Pacific coastline from the south, washing resorts with heavy winds and rains.
Some 15,000 people, many of them foreigners, were evacuated from threatened areas in the peninsula, including Los Cabos, a favorite destination for US and other international tourists.