Benefits of investing in Bali real estate
Real estate in Bali has become a popular investment destination for the following reasons:
⇒ Tourist attractiveness
Bali is among the top 5 countries popular among tourists from all over the world. What does this mean for an investor in local real estate?
High demand for rental housing. There is no seasonality as such, but the most visited time is the period from April to November. At this time, the average occupancy rate in tourist areas is:
88% in Seminyak;
86% in Canggu;
85% in Ubud;
82% in Sanur.
If we consider coastal complexes, but the occupancy reaches 92-94%.
High profitability. Bali is one of the locations with the highest profitability from renting out housing. The owner’s income largely depends on the area and other factors. If we talk about average indicators in tourist places, the ROI is 10-12% per annum. In some complexes, the yield rate reaches 16%. For the investor, this is a guarantee that the funds invested in the purchase of real estate will pay off within 5-7 years.
⇒ Flexibility of use
The owner of the property decides how to use the purchased property: to live there on their own, to rent it out on a permanent basis, or only during periods of their absence. The investor receives not only an investment asset, but also a place to relax on the island with a wonderful atmosphere. In Bali, housing is rented out for a short period of time, so the owner can clearly plan their vacation.
⇒ Growth in housing costs
Every year, the cost of Bali real estate on the primary market grows by 10-12%. For the investor, this is a sign that the investment will be profitable in the long term. This is especially important for buyers who have chosen not to rent out housing, but to purchase an off-plan property for subsequent resale as an investment strategy. By the time the housing is rented out, its value increases by 20-30%, and a year later – by another 10%, which allows the investor to play on capitalization and make a good profit.
⇒ Stable political climate
For investors, this is a huge plus, which allows them to make forecasts for further development. If we add to this factor the low inflation rate (2.3%), then Bali opens up wide opportunities for foreign investors to protect their capital and increase it.
⇒ Low entry threshold
The Bali real estate market offers investors a wide range of properties, from compact studios to luxury villas. For investors, this is an excellent opportunity to choose the option that meets their needs and fits into a certain budget. The entry threshold to the market is low – in Bali, you can buy apartments for rent starting at $120,000.
Separately, it is worth mentioning the support of local authorities. The government is interested in attracting foreign capital, so it does everything possible to create a favorable investment environment. This includes simplifying the procedure for acquiring real estate for foreigners, providing the opportunity to obtain a residence permit and creating a transparent tax administration system.
