Bali Real Estate
A real estate agent perspective on the Bali Real Estate market 2020.
The economy in Bali during 2020 has been hit hard by the global pandemic outbreak with the International flights and airport Ngurah Rai temporarily closed for international travel, and the void in the issuance of Visa on Arrival for tourists since 20th March 2020. In this article we will meet Dwi Rastini, an independent Bali based agent working with Bali Luxury Estate, and hear her thoughts on the current Bali Real Estate situation and condition, whether it is impacted by the global pandemic or not. Dwi Rastini has been working in the Bali Property business for more than five years now and her insights help Bali property buyers and property sellers make their decision wisely. If you are currently in the property market to acquire any Bali properties contact Dwi for the best villa sale in Bali at the contact form below.
We asked her several questions about the Bali Property and Real Estate condition going into depth of each question and we hope this will benefit our readers deciding either to purchase villas or raw land to develop villas. There is obviously a fine line between developing your own villas compared to buying an existing real estate for sale in Bali.
Is it worth buying a villa in Bali?
This is depending on what the purpose of purchase the Bali villa or land. If you are thinking to buy a Bali villa for your family residence, for sure it’s worth it. If you are thinking to purchase for pure investment, it is worth it depending on the investment calculation related to the price of the property as well. In Bali, an ROI on rental properties often reaches 10% on the rental income, before adding the property appreciation. Overall I will say its worth it to buy a villa in Bali, we see many successful villas achieve a good return in renting daily or yearly, it is based on the location of course. The general Bali property appreciation in land value is plus-minus 10% a year in capital gain.
How much do you need to live comfortably in Bali?
Live comfortably is really subjective and depending on your lifestyle, single or with a family. The typical Bali Digital Nomad lifestyle is the one who lives on a budget-friendly accommodation in an apartment and to live comfortably around 15 Million IDR a month should be enough, however, if you’re a local in Bali a 10 million IDR per month will take you a long way and it’s considered lucky to have such salary and job and potentially apply for an Indonesian mortgage to acquire a small Bali house. If you are an ex-pat family living in Bali and you have kids attending the International Schools such as Canggu School, Montessori, Bali International School and Green School your budget needs to increase dramatically – A nice modern villa rental between 250 million to 450 million each year, each child at least USD 20k per year in school fees and so on. The best family-oriented long term rental villas for a family is found in Berawa, Northern Canggu or Sanur. On long term rentals properties, it’s expected from owners to pay the year up front, this is the standard procedure for most homes available for long term rental in Bali.
How much does a house in Bali cost?
This is really depending on the size, location and material that is used. In average to build a decent house on a “ready to build land” will cost around 7 million per sqm plus-minus depending on how luxury you want your Bali villa. The Bali land prices vary on the different locations such as Batu Bolong, Seminyak, Bukit, Sanur and Ubud. There are many villas for sale in Bali and it’s been a Buyers market since I started in the real estate business. There are always good deals out there to be acquired from USD 200,000 to USD 500,000, the quality of these Bali villas in this budget will be better on a lease compared to a freehold villa due to the cost of the land.
If you find and decide to buy land and make your Bali villa remember that it will take between 12 to 18 months to finalize a Bali villa, depending on the size and material used. You need to source an architect, a contractor and apply for an IMB and all the necessary licenses. An estimated timeframe can extend further and potential time lost. However, we have fantastic Bali Architects and contractors we can recommend for any Bali real estate project. Additional things to consider buying Bali land: signatures for the IMB, ceremony on the land before you start to build your property, dry the land you buy, access road who pays for it and so on – all these comes with an additional cost.
Can foreigners buy property in Bali?
The short answer to this is yes, foreigners can buy and own property in Bali, Indonesia. The longer process is explained by the article Legal Facts about Indonesia Real Estate. A foreigner can acquire villa and land in Bali through the following structures: Hak Guna Banguanan, Hak Pakai and Hak Sewa. The most commonly used is the Hak Sewa option which is Leasehold. The two other options require you to own a company or have a residence permit in Indonesia. Please note in order to acquire Guna Bangunan and Pakai you need to purchase the Hak Milik (Freehold) titles from an Indonesian citizen, and during the process, the titles are being converted. This means you sale the titles to an Indonesian citizen and automatically upgrade to Freehold again meaning the value is the same and does not depreciate as a lease.
With the impact from the Pandemic, how has the Bali real estate market performed in 2020 and what do you expect in 2021?
There are two market segments in Bali, domestic and foreign buyers. and let me explain these two separately.
On the Bali freehold market, there have not been so big impact, in fact, there are a lot of transactions especially land sale transaction, but also many luxury villas available a year ago has already been sold, this is due to a bigger demand from the Indonesian freehold buyers from the bigger cities such as Jakarta, Bandung, Surabaya and Medan want to have a piece of paradise in Bali. I also believe the lockdown in the bigger cities resulted in a buyer frenzy wanting to relocate to Bali.
Foreigners are also buying up leasehold villas and land in Bali, mostly these property buyers already living in Bali and the current hotspot is Berawa, Batu Bolong, Pererenan and Echo Beach. Actually, since the pandemic started the amount of leasehold property transactions are slowing down compared with the previous year, in the other hand the development happening in Canggu area is staggering, it does not seem it has had much effect on the Bali property development.
A Bali based Real Estate agency recently reported that this year is their best so far of operating more than 15 years, so overall the Bali Real Estate market seems strong even during a pandemic, prospective property buyers who await further might lose out on great savings and property deals. We expect 2021 to be one of the best years of operating due to Bali popularity and support from domestic buyers seeking secondary houses in Bali.
Find the latest listings of Bali Property and the best villa sale in Bali
While searching for the latest listings for Bali villa sale has to offer it’s also equally important finding the Bali real estate agent and agency that service and listen to your needs. Make sure that the agents know the Bali property and Bali real estate selection of villa and land options in the area. Some agent tries to sell you a dream you didn’t ask for, while professional real estate agent listens to your need and search for your requirements. Sometimes the agent or agency does not have the villa you inquired about, however, with the local knowledge and expertise they help to find your dream home. Find the latest Bali Property for Sale and Real Estate properties in the search bar on the top.
Bali Luxury Estate updates their website regularly with fresh listings i.e. find Bali villas for sale and Bali land for sale. If you are looking to rent a Bali villa or hiring a local management company to manage your Bali villa we can recommend some of the best in the field managing the rentals and commercial aspect of your Bali villa.
We hope the information about Bali Real Estate is a useful read continuing your search finding listings and property for sale in Bali, and we as a Bali real estate agency are looking for to assisting you on finding the perfect property and real estate for you. If you find a property or listing not listed on our website we are more than happy to co-broke with the other agent and arrange viewings and negotiate on your behalf, our sales agent would be more than happy to provide this service.