From Vacation Spot to Investment Hotspot
Since the pandemic ended, Bali has seen a significant rise in interest from foreigners eager to invest in real estate. Once known primarily as a vacation spot, the “Island of the Gods” has now emerged as a highly sought-after investment destination.
A key indicator of this trend is the growth in Bali’s Property Demand Index, as reported by Bank Indonesia (BI). In the second quarter of 2024, this index increased by 5.51% year-over-year (YoY), signaling a significant rise in demand.
This increased demand has led to a corresponding increase in commercial property prices, with a 6.40% YoY growth. Retail and apartment rental prices have seen particularly impressive growth, up 15.09% and 9.71% respectively compared to the previous quarter.
Hotels and offices have also experienced rental price increases, although not as dramatic. Rental prices for these property types rose by 5.91% and 3.50% YoY.
The growing popularity of Bali’s real estate market aligns with the overall economic health of the region. The Real Estate business sector contributed 2.16% to Bali’s Gross Regional Domestic Product (GRDP) in the second quarter of 2024.
Ensuring the Sustainability
Erwin Soeriadimadja, the head of Bank Indonesia’s Bali branch, explained that the surge in commercial property prices was due to the increased number of tourists during the second quarter, especially during peak tourist seasons and school holidays.
In addition to its appeal as an international tourist destination, the property market in Bali is considered to be increasingly dynamic, also driven by the Indonesian government’s initiative to facilitate foreigners’ access to property ownership.
This is evident in the brisk sales of villas, especially since the pandemic. According to the Bali branch of Real Estate Indonesia (REI), popular areas for villa purchases include Nusa Dua, Jimbaran, Sanur, and Ubud. Prices for these villas typically range from IDR 2.2 billion to IDR 5 billion, with sizes varying from 100 square meters to 500 square meters.
These sales are expected to continue growing as villa development is still feasible despite limited land availability in Bali. Villas require smaller land areas compared to other types of buildings. Developers are also committed to ensuring the sustainability of these areas to avoid overcapacity.
Favorable for Foreign Investment
The data and the statements above are clear indicators that Bali’s real estate market is booming, offering investors a prime opportunity. Foreign investors benefit from favorable government policies that have streamlined property ownership. The island’s growing tourism industry also provides a steady stream of potential renters and buyers, ensuring a healthy return on your investment.
Don’t miss out and let’s start your business journey with Seven Stones Indonesia. We are your local experts who are ready to guide you through the process. With years of experience and a deep understanding of Bali’s property laws and regulations, we can assist you in managing stress-free property transactions. Reach out to us today to leverage our expertise and discover the opportunities that await you in Bali.