Bali’s real estate market has rebounded impressively post-pandemic, driven by a surge in both international and domestic tourism. With the rise of demand for commercial property in Bali and over 6.3 million international visitors and more than 9.6 million local tourists in 2024, investor interest has skyrocketed. As more foreign and local investors enter the market, the question arises: Should you invest in commercial or residential property in Bali??
Commercial Property Investment in Bali
Commercial property in Bali includes offices, retail shops, warehouses, and hospitality venues such as boutique hotels and co-working spaces. Investors often favor Bali’s commercial property for its higher rental yields and longer lease agreements, which ensure a more stable income stream.
Many foreign nationals from Russia, Ukraine, the Middle East, Europe, and the US have begun eyeing the commercial real estate sector in Bali. As tourism and local businesses recover, the demand for commercial spaces grows. According to Investopedia, commercial properties often offer higher returns but require greater capital and management skills.
Shanny Poijes, Founder and CEO of CORE Concept Living, emphasized the shift in demand: “During the pandemic, people realized they could work from anywhere. Bali, with all its appeal, became a powerful magnet for this new trend.” She stated, as cited by Kontan.co.id. This trend has fueled development projects that combine commercial utility with lifestyle appeal.
Read More: Understanding Bali Land Zoning Regulations for Commercial Villas
Residential Investment in Bali
Residential property in Bali ranges from private villas and apartments to holiday homes designed for short-term rentals. Post-COVID, the “holiday home” concept has gained traction among investors seeking flexible-use properties that blend modern tropical aesthetics with local cultural elements.
I Wayan Sudarma, Director of Miraland Bali, noted this shift: “This shows strong market enthusiasm for the holiday home concept as an attractive and ideal property investment,” he said as reported by Balipost.com. His company’s Samani Villa Pecatu project sold out its entire first phase, driven by buyer interest in vacation-ready residences.
Developers have also started integrating community-focused elements into residential projects. For example, CORE Concept Living plans to develop Scandinavian-inspired homes with 20 limited units in Bali to foster strong resident communities. These homes prioritize sustainability with features like solar panels, energy-efficient lighting, and eco-friendly waste systems.
Comparing Profitability: Commercial vs Residential Investment in Bali
When comparing profitability, both commercial and residential properties have clear advantages. Commercial real estate offers higher average rental income, longer lease durations, and tenants who often cover operating expenses. However, they come with higher upfront investment and are more sensitive to economic shifts.
In contrast, residential properties provide more predictable demand, especially from tourists and remote workers. Yet, they tend to yield lower returns and face frequent tenant turnover. Still, residential units, particularly well-designed holiday homes, continue to perform well due to Bali’s tourism-driven economy.
Commercial properties generate stronger net operating income but may be harder to liquidate. Residential properties, while easier to manage and sell, often require hands-on oversight.
Read More: 7 Key Characteristics of Investment-Worthy Property
Factors to Consider When Choosing Between Commercial and Residential Investments in Bali
When choosing between the two, consider these key factors:
- Budget and financing: Commercial properties need more capital.
- Risk tolerance: Commercial spaces react more to market shifts.
- Management complexity: Commercial investments demand more expertise.
- Resale and liquidity: Residential units are easier to sell.
- Location: Consider proximity to tourism hubs for residential and commercial zones for business properties.
Investing in commercial property in Bali suits those with larger capital and a long-term growth outlook. Residential investment is ideal for lifestyle buyers or first-time investors seeking stable income and easier management.
Start Your Bali Property Journey with Expert Support
Whether you’re leaning toward a holiday villa or a boutique hotel project, choosing the right property type depends on your goals and risk profile. At Seven Stones Indonesia, we specialize in helping investors navigate Bali’s dynamic real estate market with confidence and clarity.
Let our team guide you through licensing, local regulations, and strategic development. Contact us now to start your journey toward owning commercial property in Bali or exploring residential opportunities tailored to your vision.
Source: Investopedia.com, industri.kontan.co.id, balipost.com
Image: Getty Images