If you think Bali is oversaturated with too many properties, you should check out this post.
Because it’s even further from the truth…
In April alone, 503,194 foreign tourists visited Bali, 7.24% more than the 469,227 visitors in the previous month.
This means more accommodations are required to meet this growing demand.
Given expectations about interest rates and supply, demand will likely continue to exceed supply.
What does this mean for foreign property investors?
It’s not too late to take advantage of this lucrative opportunity and add incredible, steady monthly income to your portfolio.
Beyond the high demand for accommodations, I’ll give you 11 reasons to consider Bali as your next property investment destination.
Factor #1 Economic growth
Bali has experienced remarkable economic growth over the years, making it an attractive destination for investors.
For example, the tourism sector, a significant contributor to Bali’s economy, has seen a steady increase in both domestic and international visitors.
This growth has increased demand for hotels, restaurants, and related services, making it an ideal sector for potential investors.
Source: The economy grew by 4.94% in the third quarter of 2023 (year over year)
Bank Indonesia expects robust economic growth in 2023, likely towards the upper end of the 4.5-5.3% range.
Factor #2 Ease of doing business
Bali has implemented several measures to improve its business environment, making it easier for investors to start and operate their businesses.
The Indonesian government has simplified bureaucratic processes, reduced red tape, and implemented investor-friendly policies to attract investment.
For example, the Online Single Submission (OSS) system, introduced in 2018, streamlines obtaining necessary permits and licenses.
This initiative has significantly reduced the time and effort required to set up a business in Bali, creating a more favorable environment for investors.
Factor #3 High demand from the domestic markets
The demand for accommodations comes not only from international visitors but also from domestic ones.
Here is the number of domestic visitors to Bali by Month in 2023…
Source: The Number of Domestic Tourists Visit to Bali
Most locals come with a large family member to stay for either short or long-term holidays. They bring their nannies, grandparents, kids, and parents, so staying in a hotel would be inconvenient. That’s why most of them stay in a villa with 3 – 6 bedrooms in the most sought-after location.
Factor #4 High Occupancy Rates
Bali’s strong domestic market demand provides a stable foundation for investors.
With a population of over 4 million and a growing middle class, there is a consistent demand for various goods and services.
Through Ngurah Rai Airport, Bali has become the primary destination, attracting over 5 million visitors in 2023 and increasing occupancy rates for accommodations.
With Bali being one of the most visited islands, it is no wonder that Bali property investment has consistently been a top performer in terms of returns and stability.
Moreover, properties in the hottest locations, like Canggu and Seminyak, could see 72% – 88% occupancy rates or even higher.
Factor #5 Attractions and Cultural Hotspots
Bali is often called the “Island of the Gods” because of its rich cultural heritage and stunning natural beauty. The island has thousands of Hindu temples that attract tourists and host regular ceremonies and festivals that showcase Balinese traditions.
Bali’s natural attractions are equally compelling. The island boasts beautiful beaches like Kuta, Seminyak, and Nusa Dua, which attract sun-seekers and surfers.
Inland, the terraced rice fields of Tegalalang and the sacred monkey forest in Ubud offer unique experiences for nature lovers.
These diverse attractions mean that Bali can appeal to a wide range of tourists, from luxury travelers to backpackers, providing various investment opportunities in different market segments.
Factor #6 Accommodate foreign inventors
The government has eased foreign property inventors’ investment process in Bali. One of them is announcing a tax break and a new visa program.
President Joko Widodo recently announced new tax breaks for buying property to help boost Indonesia’s housing sector and strengthen the country against the uncertain global economy.
The government will waive the value-added tax (VAT) on home purchases priced up to Rp 2 billion ($126,000) until June 2024. From June onwards until the end of the year, these purchases will get a 50% VAT discount.
Plus, Golden Visa regulations (a special visa for investors in Indonesia) are expected to positively impact property investment in Bali and other regions in Indonesia.
Factor #7 Infrastructure developments
The Indonesian government’s support for Bali’s tourism industry is evident in several ways.
From improved roads and highways, new bus routes and public transport options, healthcare services, high-speed internet expansion, and more.
Bali is constantly upgrading its roads and highways, making it easier to travel around the island. For example, the toll road from Denpasar to Nusa Dua has cut travel time in half. This means your future property is more accessible to tourists and locals.
Furthermore, new international hospitals and healthcare facilities, such as the Bali International Hospital, are being built in Bali.
Knowing that top-notch healthcare is nearby makes your property more appealing to retirees and families.
Factor #8 Stable returns and less risk
As you know from the visitors’ data and the high occupancy rates Bali offers, there will be a constant demand for rental properties.
This steady flow of tourists ensures that you can have a reliable rental income.
For example, even during the off-season, many digital nomads and long-term visitors stay in Bali, keeping rental demand high.
Property values in Bali have steadily increased over the years.
Areas like Canggu and Uluwatu have seen significant property price growth due to their popularity with expats and tourists.
Bali’s perfect tropical weather means you can rent your villa to tourists during the high season and offer long-term leases during the low season.
Factor #9 Strategic location
Bali is one of Indonesia’s most popular destinations and is an entry point for tourists and businesses exploring other parts of the country.
Bali’s Ngurah Rai International Airport has direct flights to many major cities in Asia, Australia, and the Middle East, making it easy for international tourists and investors to visit.
Bali’s time zone (GMT+8) aligns well with major Asian financial centers, making business operations and communications convenient.
Plus, Bali’s tropical climate makes it an attractive destination all year round and helps keep tourism and investment steady.
Factor #10 Government support for tourism
The Indonesian government has shown significant support for Bali’s tourism industry, making it an attractive destination for foreign property investment.
The government’s commitment to promoting tourism has led to various initiatives and policies to boost the sector.
The government actively promotes Bali as a premier tourist destination through marketing campaigns and participation in international tourism events.
For example, The “Wonderful Indonesia” campaign, launched by the Ministry of Tourism and Creative Economy, showcases Bali’s unique attractions and cultural richness to a global audience.
These efforts aim to attract a more significant number of domestic and international tourists, which in turn drives the demand for accommodation and other tourism-related properties.
The government of Indonesia also recognizes the importance of preserving Bali’s natural and cultural heritage to sustain its appeal as a tourist destination.
Establishing protected areas, such as national parks and marine reserves, ensures the conservation of Bali’s natural beauty and biodiversity.
These protected areas contribute to tourism’s sustainability and provide opportunities for eco-friendly property investments.
Factor #11 Affordable prices and diverse options
Bali’s property prices are significantly lower than those in cities like Singapore or Hong Kong, making it an attractive choice for investors looking for more affordable options.
Bali also has been identified as one of the cities with the lowest home prices globally.
The average apartment price in Bali is estimated at $283,381, providing budget-conscious investors an opportunity to invest in luxury properties in a tranquil setting.
The affordability of properties in Bali opens up favorable investment opportunities for individuals and businesses.
Bali’s property market offers a range of investment options, from affordable apartments to luxury villas.
Areas like Seminyak and Uluwatu provide diverse investment opportunities, catering to different budget considerations.
What does it mean for you?
As Bali continues to attract tourists and investors, the demand for properties is expected to increase.
This growing demand and the limited supply of affordable properties may lead to price appreciation over time, offering investors the potential for capital gains.
Investors can take advantage of Bali’s affordable property market to enter the market and potentially benefit from the island’s growing popularity.
But with various options, it can be hard to choose which brings the most value to your money—that’s where an experienced real estate agent can help.
In Bali Villa Realty, our knowledgeable team can help you review your investment property in Bali and give you a personalized investment plan.
If that’s what you’re looking for, book your free slot to consult with one of our senior advisors by clicking the link below.
ding ding canggu