Avenue Realty

TIPS ON BALI PROPERTY INVESTMENT FOR FOREIGNERS

debby — Thu, 11 Nov 2021 10:01:15 +0000

Investing in real estate is a rewarding experience and you can get the most out of it by doing it the right way. Property investment in Bali is still a profitable venture despite the pandemic when you take into account the high demand that is being held up by the border closure. On the contrary, the pandemic presents a golden opportunity to buy a property in Bali as you will be prepared to satisfy that demand once international travel is no longer restricted.

Whether you’re a first time buyer or expanding your portfolio, these tips can help maximising the return on your investment:

Buy leasehold

Buying freehold properties using the nominee arrangement offers no legal protection and is not a recommended practice. The lease duration for leasehold properties in Bali is typically between 25 to 35 years, which is sufficient for long term capital growth especially if you invest in a good location.

While establishing a foreign investment company (locally known as PT PMA) is the safest method for foreign ownership of properties, buying freehold villa or land with a PT PMA is recommended for medium to large scale investments as there is a minimum amount of capital investment that must be met.

Invest in emerging areas

Buy property in up-and-coming regions like Canggu while there’s still a lot of opportunities, especially in the Berawa neighborhood where all the buzz is happening right now and the property value is on the rise. Saturated areas such as Seminyak and Kuta offer little room for new developments while property prices are considerably higher. The rental demand growth in emerging areas is also stronger than in developed areas as seen in the last 3 years, which is highly advantageous if you plan to invest in short term rentals.

Don’t overlook less developed regions near emerging areas, but rather invest in those regions early on. Pererenan, for example, is not as developed as its neighbor Canggu just yet but it’s a promising location both for long term investments and short term rentals.

Get to know the rental market

This is particularly crucial if you wish to sublease your property either annually or daily, as the market condition of each region varies from time to time. Being well informed on the latest trends, including any changes in the average rent price and demand will allow you to recognize the current state and potential of the market, enables you to invest in the right place and property. Even if you’re looking for a home to settle in, it is very useful to understand the property’s rental potential as you may consider renting it out for cash flow while you’re on vacation overseas or returning to your home country.

Villa revenue is determined by several factors such as number of bedrooms, design, location. Revenue of different properties with similar specifications can easily vary, and you can achieve double the amount if you fit the right demand in the right area. Supply and demand for specific amounts of bedrooms also vary depending on the region’s market. For daily rentals, good management is essential as this will affect guest satisfaction and reviews. For long term rentals, proximity to international schools or coworking spaces will make your property more appealing to tenants with specific needs.

This is one of the primary reasons why it’s important to work with local licensed real estate agencies and property management companies, and we’ll talk about it more later on.

Consider buying off-plan properties

Off-plan properties are usually priced lower than the market value, and you don’t have to worry about maintenance costs during low occupancy at times like this. Buying off-plan may be a cheaper option than a fix-and-flip as renovation costs can inflate easily if an existing property has hidden costs, which is something that you must beware of when browsing bargain properties. In addition, you might find off-plan properties offered with guaranteed ROI.

Investing in large-scale off-plan developments as early as possible is a wise move, as it allows you to secure the best units available before reaching their peak competitive pricing. Most of the developments increase their price along with the construction progress, and buying an off-plan villa before breaking ground will be cheaper than when it’s at 30% completion.

Appoint a reliable property manager

Seek a property manager who has a good network of tradespeople that can help with the maintenance of your property, so you won’t have to look hard for housekeepers, gardeners, plumbers, etc. Hiring a manager is essential for rental properties even if you don’t live far from your investment because you can divide the workload accordingly or delegate it entirely for a hassle free operation, which is a lifesaver if you’re running multiple rentals at once.

Guest satisfaction is instrumental in attracting customers, because online reviews greatly affect a prospective customer’s decision to book your property or not. With that said, working with a good management company is not only helpful in maintaining your property but also in producing high numbers and quality reviews.

Consult with local real estate agents

Whether you want to buy through them or need some information, always seek the help of a licensed agent. Local agents are the best source because they can provide reliable and up to date information including the aforementioned insights into the property market, such as the rental outlook of a region and even the rental forecast of a particular property. Besides, the agent may already have listings that perfectly suit your budget and preferences, saving you from the tedious work of searching through Bali’s bustling streets.

Don’t bother working with unlicensed freelance agents as they do not have the legal authority to broker real estate transactions. Even worse, you might get caught in scams such as overpaying the property or the agent’s commission.

At the end of the day, you can’t really go wrong with your investment decision as long as you do extensive research beforehand. When you’re ready to invest or would like to browse what kind of opportunities available today, feel free to visit our catalog of villas, land, and properties available for sale in various regions of Bali. For more information on real estate investment in Bali or property related matters, please do not hesitate to contact us.

GREAT PLACES IN BALI FOR VILLA INVESTMENT

debby — Thu, 11 Nov 2021 09:47:10 +0000

The paradise island is beautiful in every part, though some regions fare better than others when it comes to their prospects for real estate investment. This pandemic is a golden opportunity to buy property in Bali, since not only you might find discount land or property for sale in Bali but also you’ll be prepared to welcome the upcoming influx of vacationers once the international border reopens.

Better yet, the property market of certain areas is currently ripe for harvest because of the area’s rising popularity which in turn increases the demand for villas. Whether you want to fix and flip, buy-to-let, or develop an investment from zero, these regions are our top picks to invest in Bali’s commercial real estate based on the current state of the property market. Here’s our recommendation on the best places to own a villa in Bali right now:

Canggu

The trendy region is definitely the first on this list, because properties in Canggu have significantly increased in value within the past few years. A melting pot of various cultures and lifestyles, Canggu is currently the most sought after destination in Bali both for vacationers and business people alike. Berawa, in particular, has skyrocketed into fame thanks to rapid developments that produce attractive amenities and popular establishments like Finns Beach Club and Finns Recreation Club (formerly Canggu Club), making it the primary target to buy land in Bali.

The formerly sleepy Echo Beach and Batu Bolong also experience similar changes, welcoming new kinds of crowd in addition to the usual die hard surfers.

Graphic depicting the average monthly revenue of daily villa rentals

With high demand and ample space for development, Canggu is the number one region to invest in Bali. Property for sale in Canggu is selling quickly because of high demand, and it is arguably the best place to buy villas in Bali today. It also has a great selection of land for sale leasehold in all Bali because it’s not fully developed yet.

Villas for sale in Canggu are very profitable both for short-term and long-term rentals because the region is the number one pick to find holiday villas or houses for rent in Bali. The region is only second to Seminyak in the short-term villa rental market, surpassing every other tourist destination in Bali. Lease agreements for villa leasehold in Bali typically lasts between 20 to 30 years, which is sufficient for capital growth.

Tourists and expats keep flocking to Canggu on a daily basis despite its infamy for traffic congestion, flourishing the region’s villa industry not only in its touristic areas but also in the quieter residential neighborhoods.

Seminyak

Property price in Bali’s oldest resort town is amongst the most expensive in the island for many good reasons, mainly because of its renown as a sophisticated destination. Seminyak attracts a more refined crowd with its luxurious offerings, setting it apart from more laid back tourist hotspots like the neighboring Canggu.

The main streets of Seminyak are full with restaurants, cafes, coffee shops, and a wide assortment of shops, while the luxury resorts are mostly located on the beachfront. Nightlife is very busy, with large crowds concentrated in the famous clubs Motel Mexicola, La Favela, and Potato Head.

Though the main streets are undoubtedly lively during both day and night, most villas in Seminyak are located in the small streets and gangs so noise problem is not inevitable. Seminyak is definitely not the place to find Bali villas for sale cheap, because villas for sale in Seminyak are among the most expensive due to competition. Despite these perceived drawbacks, Seminyak remains on top of the short-term rental market as it yields the most profits from villas for rent in Bali, more so than up-and-coming Canggu.

Seminyak’s location is very convenient for travel and it offers a wide variety of high-end amenities, which is no surprise as to why the region remains highly popular among vacationers to this day.

Sanur

A long time favorite of retirees and families with children, good ol’ Sanur is an excellent location for vacation, residence, and investment. Sanur’s ambience is more mature though not as sophisticated as Seminyak, offering a lively nightlife sans the hustle and bustle from Bali’s less refined areas. The beachside is one of the few places in Bali where you can get around on foot or on a bicycle, hence its popularity among foreign residents.

Sanur is also the preferred crossing point among vacationers who wish to sail towards Nusa Penida and Nusa Lembongan, so the region is almost never in short supply of visitors.

Graphic depicting the average demand growth for villas, not including villa leaseholds in Bali

The demand for short term rentals in Sanur remains high within the past 2 years, meaning that its full potential is yet to be tapped. There aren’t too many options of apartments and private villas in Sanur since lodgings are provided mostly by hotels and homestays, which means that there’s ample opportunity to develop your own and then rent it out for rental income.

Sanur is a good place to find Bali houses for sale, as they often come with the advantage of being within walking distance from essential facilities. Bali homes for sale in Sanur also tend to retain their classic look if it’s something that you desire. Vacant land on the beachside is selling fast and it’s only a matter of time until there won’t be any left to buy or rent, so you’ll have to seize any available opportunity immediately.

Nusa Dua/Uluwatu

Though not as developed as Seminyak or Sanur yet, the laid back surfer’s paradise is getting more and more reachable by vacationers thanks to recent developments. Home to the most extravagant resorts and amenities in all of Bali, Bukit Peninsula is steadily rising into a primary tourist destination.

Tourists are attracted to famous hangouts like Rock Bar at Ayana, Single Fin, and the newly opened Savaya to name a few, while surfers and beach goers can’t resist the unveiled beauty of Nusa Dua beaches and picturesque views. Nusa Dua is a good place to find villas for sale in South Bali, as the villa offers in the area often feature ocean views that you can’t easily find even in places like Nusa Dua.

Short term villa rentals in Bukit Peninsula performed well in the last 3 years, with villas in Nusa Dua, Ungasan, and Pecatu yielding more monthly revenue on average than those in Ubud. Combined with the widespread availability and reasonable pricing of vacant land in the area, Bukit Peninsula is highly prospective for long term investments as well as starting a rental business in Bali. Although living convenience used to be an issue, sped up developments have vastly improved the quality and quantity of facilities in the area.

Ubud

A celebrated destination for Bali holiday well known for its strong spiritual and cultural heritage, Ubud is the staple destination for vegans, yogis, art lovers, and foodies from all around the globe. From the art galleries to the famous landmarks, Ubud is packed with tourists and expats who instantly fell in love with the town on their very first visit. The region is also a prime choice for retreats and honeymoons, especially in certain parts of Tegallalang where many villas and resorts are hidden within the peaceful jungle.

All in all, Ubud’s distinction from Bali’s typical beach town offerings is what makes it wildly popular.

Graphic depicting the supply increase of villas for rent in Bali

The number of Ubud villas are increasing faster than any other area on this list, which is unsurprising as the short term rental market is flourishing thanks to steady supply of tourists. Be prepared to compete when offering a Bali villa for rent in Ubud, because the demand is high while pricing tends to be more affordable than in the other regions.

Since Ubud’s town center is already quite saturated, you might want to look for opportunities in the outskirts especially if you wish to have a river side or a rice field view investment.

Those 5 regions are the best locations to invest in Bali property today, all offering great potential for investment return on top of their distinctive charms. Avenue Realty Bali is the best property agency in Bali to help find the right investment for you, as we are backed with an extensive catalog ofvillas,land, andproperties both leasehold and freehold for sale in Canggu, Pererenan, Seminyak, and other regions in Bali.

Please do not hesitate tocontact us if you’re looking for Bali properties for rent on a monthly or yearly basis, houses for sale in Bali, villas for sale in Bali, want to sell villas in Bali, or want to consult about Bali real estate.