Choosing the right place for real estate investment is a crucial step that can significantly impact your investment outcomes. A wrong choice of location can lead to losses, low profitability, and high risks. In this article, we will consider several key factors to take into account when choosing a place to invest in real estate in Bali. We will discuss issues related to location characteristics, tourist footfall, budget, and other essential factors that will help you make the right decision and succeed in investing in real estate on this beautiful island.
Comparing prices on different booking platforms can assist in choosing the best location for investing in purchasing a villa for rental in Bali. By analyzing prices across different platforms, you can understand which area is most popular with tourists and which types of housing are in higher demand. This can help in making decisions about which villa to buy, where to build it, and how much you can expect to earn from the rent. A simple example can be seen in the following graph:
The island's territory is divided into zones - a total of 11 zones. Since we are interested in real estate, we only need to familiarize ourselves with two types:
Usually, each offer already mentions the type of land, so it is advisable to pay attention to this.
The website bali.com features a map with the main tourist locations. You can see that tourists not only love the south of the island but also remote places in the east, north, and northwest. Is it worthwhile considering these places? It depends on each individual's goals. Based on experience, we have focused on specific locations where occupancy is consistently high, and therefore, the return on investment, ROI, does not fall below expectations. Let's examine each location separately.
The most popular place for tourists for daily rental real estate. Beautiful beaches, a vast number of cafes, restaurants, and shops attract tourists and expats from all around the world. As of today, it has the largest community of foreigners of various nationalities. Nightlife here bustles every day, and during the day, there are hundreds of options for sports and relaxation. The cost of one hundred square meters of land for one year is $1500-$3000.
The second most popular place for tourists for daily rental real estate. It is said that all tourism has moved from Seminyak to Canggu. And before Seminyak, everyone was in Kuta. Indeed, the island is steadily growing, and 30 years ago, Kuta was the main hub. But even today, Seminyak remains a popular place among tourists, thanks to its atmosphere, a large number of establishments with long-standing reputations, and beaches, including Petitenget Beach, considered one of the best on the island.
The cost of one hundred square meters of land for one year is $1500-$3000.
Located between Seminyak and Canggu. The Berawa area is known for its beautiful beaches, such as Berawa Beach, Echo Beach, Batu Bolong, and others. At Berawa Beach, there are several popular bars and restaurants with ocean views where you can enjoy the sunset and a pleasant atmosphere.
The cost of one hundred square meters of land for one year is $1500-$3000.
Legends circulate about this place. It attracts tourists even being in the center of the island without an ocean, beaches, and surfing. Ubud is the perfect place for those seeking tranquility and relaxation away from the noise and hustle of city life. Here, you can enjoy panoramic views of nature and immerse yourself in the rich culture of the locals. The area is famous for its temples, museums, amazing vegetation, and also craft workshops where local residents create unique handmade items.
The cost of one hundred square meters of land for one year is $250-$800.
The Bukit Peninsula also deserves a mention - it's the southernmost point of Bali, known for its fantastic beaches, magnificent cliffs, and impressive views. This area with white sandy beaches is the perfect place for surfing, swimming, and quality relaxation.
Jimbaran is a small town on the western side of the peninsula, known for its magnificent beaches and fish markets. Here, you will find the island's best seafood restaurants that serve the freshest seafood.
Uluwatu is an area at the southern tip of the Bukit Peninsula, where the famous Uluwatu Temple is located. This temple is one of the six key temples considered the spiritual pillars of Bali. In addition to the temple, Uluwatu is also known for its excellent surfing beaches.
Nusa Dua is a prestigious area on the eastern side of the Bukit Peninsula, home to many five-star hotels and resorts. It is also the location of the Bali Convention Center, where numerous international events are held. Nusa Dua is also known for its calm and clean beaches, ideal for swimming and relaxation.
Several interesting projects are planned on Bali in the near future, which can affect the island's tourism industry.
One such project is the construction of a Formula 1 track in the Jembrana area. This event can attract a large number of tourists and car racing enthusiasts to the island.
Also, the largest theme park in Southeast Asia, Paramount Pictures, is planned to be created in the Jembrana area. This project could become another attraction that will attract a large number of tourists.
At present, a toll road is being built on Bali from Gilimanuk to Mengwi, making tourism in North Bali and Java more accessible. Here you can find many interesting places, such as coffee, rice and tea plantations, wineries, breweries, and volcano hikes.
In addition, there are plans to build a second airport in North Bali. This can significantly improve the island's transport accessibility and attract even more tourists.
The island will continue to develop, following Canggu, the next promising area is Perenan, the cost of one hundred square meters of land for one year is currently $1000-$2000.
After choosing a promising location, some investors want to make sure for themselves that the place is top-notch. Here's what to do in this case:
One of the main risks when choosing a place for real estate investment is the low demand for a particular region. If the property is located in a place that is not popular among tourists, there is a high probability that revenues will be lower than expected.
Another risk is changes in legislation that can affect the ability to rent out property. Some areas may have restrictions on renting out property, which can limit potential income. Therefore, before investing in real estate, it is necessary to familiarize yourself with local legislation and potential restrictions.
Economic, political, and natural factors should also be considered. Economic and political crises can negatively affect the tourism industry, which in turn can affect income from property rentals. Natural disasters such as earthquakes, tsunamis, and volcanic eruptions can also affect tourist flow and income from property rentals.
It is also important to consider competition in the real estate rental market in the chosen area. If too much property is offered for rent, this can lead to a decrease in prices and income.
Identifying the ideal location and villa for investment requires a deep understanding of the local real estate market in Bali. That's why we recommend reaching out to the professionals at Alex Villas. Our team of specialists will help you select the most suitable villa in a profitable location, considering all your individual requirements and goals. With years of experience in the market, we know how to maximize your profits and ensure reliable investments. Contact us today, and we will make your investments in Bali as convenient and profitable as possible.