Investing in property in Bali can be very profitable if done right. In 2023, the Indonesian island was named the second most attractive tourist destination in the world by the TripAdvisor travel portal. The country’s government puts a lot of effort into the development of infrastructure in Bali. New roads, an airport, and other facilities are being built here, which can facilitate comfort and convenience for tourists and the local population. This creates new business opportunities and attracts even more investment to the island.
Content:
- Is it possible to make money investing in real estate in Bali?
- Bali market outlook
- The best areas in Bali to invest
- Real estate market
- Long-term rentals
- Short-term rentals
- How to choose a promising property in Bali?
- Mortgage
- Property maintenance in Bali
- We will help you buy property in Bali!
The first way to make money on real estate in Bali is to rent out your property. You can rent it out long- or short-term through various platforms such as Airbnb or Booking. What matters is to choose a good location and provide all must-have amenities to attract as many tenants as possible. The occupancy of Bali properties in attractive tourist locations can reach up to 80 to 90% per year, which allows you to expect a high return on investment.
Is it possible to make money by buying real estate in Bali today? Yes, it is. Another way to earn money is to buy a property at a low price and resell it. You can look for real estate with appreciation potential such as off-plan housing or properties in underdeveloped areas. Be sure to analyse the market and consider the costs of repairs and renovation, if necessary.
Is it possible to make money investing in real estate in Bali?
It sure is. The market is rapidly developing and provides many opportunities. If you buy a property at the excavation stage, while construction is underway, you can get a net profit of 30 to 60% and in some cases even 100%.
As for rent, the yield of 15 to 20% per annum is quite feasible, provided you choose the right property. An apartment or a villa in a well-developed location with good infrastructure or a concept hotel that is interesting for tourists can bring profit very quickly. It usually takes 6 to 12 months for a property to start generating a return or to gain high demand, unless the property is in a very popular location. In the latter case, you can expect a faster payback, but the cost of entering such a market can be much higher.
Bali market outlook
The Bali market is flourishing, as evidenced by the indicators in the tourism industry and the economy. The Indonesian economy is one of the fastest growing in the world. In recent years, GDP has reached an annual increase of 5%. As for inflation, its rate can be called minimal, standing at only 5%, which is lower than in many European countries and the United States.
The population of Indonesia is approaching 274 million people, with the middle class growing rapidly. In many Indonesian resorts, 60 to 70% of holidaymakers are local residents. Citizens of the country, along with foreign nationals, also tend to invest in property and often rent villas in Bali in resort areas. Moreover, land and real estate in Indonesia go up in price by more than 12% every year.
The best areas in Bali to invest
There are multiple most attractive locations to invest in real estate in Bali, including:
- Seminyak. This resort on the south coast of the island is considered a trendy and exclusive place. It offers a wide range of villas, restaurants, shops, and beaches. Investments here are worth it due to the high demand for rental and resale of real estate.
- Ubud. Located in the mountains, it is known for its picturesque, magnificent nature and temples. Ubud attracts tourists, and therefore there are many opportunities for investment in residential properties, hotels, and restaurants.
- Kuta. This popular tourist area is famous for its incredibly beautiful beaches and vibrant nightlife. Due to the high number of visitors, rental housing is in demand among tourists all year round.
- Canggu. This area on the east coast of Bali attracts young and active travellers. It is known for its beaches and free, laid-back atmosphere.
- Uluwatu. It boasts incredible ocean views and very convenient surfing spots.
Each of the above areas sees extensive development and rapid growth.
Real estate market
In general, the Bali real estate market is a dynamic and growing sector of the economy. This creates great opportunities for investment and construction of new projects in the island. In Bali, you can currently find such types of properties as:
- Villas. Homes with private pools, gardens and ocean views are especially common.
- Single-family houses. These are more compact and affordable residence options, often located closer to city centres and beaches.
- Apartments. Modern and stylish apartments in Bali come with amenities, such as a swimming pool, a gym, and parking.
- Land plots. The island offers a wide range of plots of different sizes where you can build your own house.
Investors are greatly interested in commercial real estate: restaurants, shops, and office space. In addition, there are many residential developments with hotel service in Bali, where apartments can be rented out.
Long-term rentals
Long-term rental involves allowing a tenant to use a property for a period from 6 months to a year or more. This type of rental provides a stable and regular income from your property. You receive monthly payments and, unlike short-term rentals, do not have to look for new guests every week. You can just conclude a tenancy agreement and then not worry about anything. There are other advantages as well. Since you rent out your property long-term, there is no need to invest in advertising and marketing to attract new tenants. This saves time and resources. What’s more, the tenant, as a rule, takes care of minor maintenance and repairs around the property, eliminating minor breakdowns or replacing light bulbs. It is important to note that long-term rentals may have certain disadvantages. For example, these are limited control over your property during the tenancy period and the inability to use it for personal purposes.
Short-term rentals
Renting out property in Bali short-term also has advantages, including:
- High income potential. Bali is a popular tourist destination, and short-term rentals allow you to charge higher daily or weekly rents compared to long-term rentals.
- Flexibility of use. You can live in your own house part of the year, enjoying the resort, and rent it out the rest of the time.
- Possibility of management. Short-term rentals give you more control over the property. You can choose when and to whom you rent out your property and oversee maintenance and cleaning.
Both long-term and short-term rentals allow you to generate a stable income and make good money.
How to choose a promising property in Bali?
First, consider popular holiday destinations. A location with a stable flow of tourists will ensure a high demand for real estate. Here are other factors to consider:
- Infrastructure. Good roads, access to beaches, restaurants, shops, and healthcare facilities will make the property more attractive.
- Appreciation potential. Explore market trends and forecasts from experts on real estate in the island. Find out if property in the area of your choice has price appreciation potential.
- Property type. Decide what type of property is most promising for you and study the demand for it.
Last but not least, before purchasing residential or commercial real estate, conduct a thorough inspection of the property. Make sure it is in good condition and meets your requirements.
Real estate prices in Bali start at an average of $65,000 for modest apartments and go up to tens and hundreds of millions of dollars for luxury villas.
Mortgage
An important aspect for overseas buyers is that there are no mortgages in Bali. A foreign national cannot take out a mortgage to buy property. However, they can purchase real estate from the developer in instalments. Almost all developers in Indonesia provide interest-free instalment plans for up to 18 months.
Property maintenance in Bali
There are several ways to do property maintenance in Bali:
- Self-managing.
- Hiring a management company.
- Working with estate agents. Many Bali property owners rent out their property through agents. This ensures a constant stream of rental income and reduces the need for self-management. Estate agents typically do marketing, arrange bookings, and interact with tenants and service (water, electricity) providers.
Some owners prefer a combined approach: they manage the property themselves part of the year and delegate management to estate agents at the peak of the tourist season.
We will help you buy property in Bali!
The easiest and most convenient way to select and compare properties you like is to use a real estate aggregator. On our website, you will find listings for liquid real estate of various types (apartments, houses, land) in the most visited areas of Bali. It aggregates information from various resources and features a large number of properties. You can use filters to refine your search, such as price, number of rooms, neighbourhood, size, and other parameters. If you want to make money in the real estate market in Bali, now is the time to choose the right option. Start searching for your ideal property today!