Property values in Bali have risen over the past five years, and the island is now widely recognized as having one of the world’s most promising real estate markets. Bali’s best residential districts have seen price increases of up to 20 percent in the last year, placing it in a tie for second place with Dubai in a recent analysis of the global luxury property market conducted by Knight Frank. Jakarta ranked first. The rising middle class in Indonesia and neighboring countries is largely responsible for the unprecedented price increases in Jakarta and Bali over the last year. Many of these people regard Bali as relatively inexpensive despite its increasing popularity as a primary or vacation destination.
Several people we know who sold their property last year saw prices soar from US$ 30 per square meter in 2008 to US$ 600 per square meter in 2013. Indeed, this is seldom an exceptional occurrence. Demand for all kinds of property in Bali, but especially high-end real estate, is rising rapidly because of the influx of foreign investors who are increasingly drawn to the island.
Bali might be compared to the French Riviera or the Hawaiian islands. Short flights from major cities like Jakarta, Surabaya, and Medan as well as Perth, Singapore, and Bangkok make it an attractive local and international vacation spot. The perfect second home for the family that is close enough for easy commuting yet far enough to feel like a complete change of pace on vacation.
Bali is the greatest island in Indonesia for domestic buyers to make an investment on. A growing middle class with more disposable means and a desire to leave the country’s ever more congested cities has contributed to a sharp increase in property values, which is expected to continue rising. As a result, its popularity is growing over the world. Investing in Bali is viewed as a sure bet, thanks to the island’s reputation for rapid profit development and stable capital appreciation. Foreign investors perceive Indonesia as a safe country to put their money in because of its political stability, and they love the laid-back vibe of Bali.
What is it about Bali that draws so many vacationers?
Bali’s many cultural offerings reflect the island’s long history. You can find just about whatever you need or desire in modern-day Bali. It has fantastic beaches, a wide variety of restaurants and stores, a thriving nightlife, and a truly multicultural population consisting of a peaceful blend of native Indonesians and foreigners. That’s why everyone seems to be interested in it. Many individuals from all walks of life are drawn to Indonesia because of the country’s strong, distinctive culture, which is partly devout to Hinduism and partly warm, inviting Indonesian society.
Bali’s tropical setting in Asia, midway between the Americas, Oceania, and Europe, is another selling point for international buyers. Many more visitors and new residents have been attracted because to the inexpensive fares offered by regional airlines like Air Asia, Lion Air, and Jet Star.
Many Australian families, in which the father is employed in Western Australia and the mother and children reside in one of the eastern capitals (Sydney, Melbourne, Brisbane, Canberra, or Perth), have relocated to Bali. It’s a good fit for the culture of many Australians, who value adventure and the outdoors, and it’s easier, cheaper, and a terrific experience to give kids at a young age. This also applies to businesspeople who live and work in Singapore, Hong Kong, or Jakarta. It’s a tiny island, but it has a lot to show off to visitors from outside.
It’s common for visitors from other countries to Bali to make an investment in the local real estate market by buying or renting out rooms, apartments, or villas to passing travellers. The real estate industry is a lucrative business because of the influx of tourists. The return on investment for several hotel chains and villa communities is above 10%.
Much of the real estate market is fueled by foreign investors. Attractive to them is the prospect of making a decent living in the area, whether through exporting or domestic sales of their wares.
Bali’s exotic architecture
The state of the real estate market, in my opinion, is excellent. As a first step, it is intrinsically related to the politically stable and economically robust Indonesian economy, which has grown by an average of 5-7 percent annually over the previous five years. In the next years, as the West emerges from recession, demand will increase. For most international investors, the current land price is too exorbitant, even when compared to that of several western countries. This is because the majority of our customers nowadays are from within the country and are “property shopping” in Bali. When compared to other major cities in Indonesia like Jakarta, Medan, and Surabaya, land and property costs in Bali are considered to be rather affordable. In addition, property loan interest rates in Indonesian banks have never been lower.
The average annual growth rate of our sales enquiry reports over the previous three years has been between 20 and 50 percent in high-demand locations. Those that made smart real estate investments in 2019 and 2020, I believe, will come out ahead. Due to the “Open Skies” policy implemented by ASEAN beginning in 2019, it is expected that the number of tourists visiting Bali would increase by at least 100% between 2015 and 2025. Because of this, in September a brand new, state-of-the-art Ngurah Rai Airport Complex will open at a cost of $US290 million.
Finally, what would you tell potential sellers and purchasers about how to be ready for the process, what paperwork they’ll need, and the role you play in promoting a piece of land or a home?
Every homeowner who plans to sell must first “get their house ready to sell,” which entails making any and all repairs and enhancing the property’s appeal to potential buyers. In addition, they must have the necessary paperwork (leasehold or freehold):
- Affording space
- Copies of the property leasing agreement and the original land title (only for leasehold land)
- Certified copy of SPTT or PBB evidencing payment of Land Tax
- A photocopy of the passport, ID, or KTP of each owner listed on the land or lease document
- A Home
- Consonant with the preceding
- Provide a copy of the IMB, the construction permit that outlines the required dimensions and materials.
- Payment of the Building Tax (if applicable)
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We wish you the best of luck in selling your property in Bali.
