In-Depth Manual on Villa Rentals in Bali for Foreign Investors
Table of Contents
- Why Invest in a Villa Rental Business in Bali?
- Selecting the Right Business Structure for Your Company
- Understanding the Significance of Building Permits
- Are You Ready to Dive into Villa Rentals in Bali?
Why Invest in a Villa Rental Business in Bali?
The allure of Bali as a paradise island has only strengthened in recent years, especially as global travel restrictions ease post-COVID. With an increasing desire for idyllic getaways, the demand for villa rentals in Bali is set to soar.
Prior to the pandemic, Bali welcomed around 6.28 million international tourists in 2019. While this number dipped to under 2 million in 2020, there’s a robust optimism for the revival of tourism and, consequently, the villa rental market.
Opportunities to Purchase Property in Bali
Looking back on those times, we can now confidently say that the market has fully recovered after COVID and is at its peak in terms of tourists and demand for villa rentals.
In recent years, the allure of Bali as a paradise island has only grown stronger. With global travel restrictions easing post-COVID, there has been an exponential increase in the desire for idyllic getaways, further driving the demand for villa rentals in Bali.
Before the pandemic hit, Bali was bustling with approximately 6.28 million international tourists in 2019. While the numbers took a significant dip to under 2 million in 2020, there is now a remarkable resurgence in tourism, signaling a promising outlook for the villa rental market.
Profitable Villa Rental Businesses for Foreigners
Foreign investors often pursue villa rental businesses in Bali not just for financial returns but also for the lifestyle it offers. The most common business models among foreigners include:
- Investing in multiple villas for holiday getaways.
- Owning a villa for personal use while renting it out occasionally, especially during peak seasons or when traveling.
- Developing a villa complex with units designated for rental purposes and others for personal use.
Selecting the Right Business Structure for Your Company
Regulatory changes in Indonesia have restricted foreigners from owning businesses classified for villa rental, reserving such operations exclusively for Indonesians. However, viable solutions exist for structuring your business:
Short-term Rentals: Establish a Hospitality Management Consulting PT PMA with 100% foreign ownership to manage villas for daily or weekly rentals. This structure allows land acquisition in tourist zones and facilitates short-term and long-term rentals.
Long-term Rentals: Foreign investors can set up 100% foreign-owned real estate businesses in Indonesia, suitable for long-term rental operations. This option is ideal for properties located in residential zones, with monthly rentals qualifying as long-term arrangements.
Understanding the Significance of Building Permits
To ensure compliance with regulations, it’s essential to obtain the correct building permits for your villa rental business in Bali:
- Villas and Homestays (Pondok Wisata): These properties can only be owned by Indonesians. Foreign-owned companies can secure rights to build or use the land through legally binding agreements with local owners.
- Building Permit Requirements:
- Villas: Can consist of up to 25 rooms with no restrictions on room size.
- Homestays: Limited to 5 rooms with specific size and floor restrictions.
Are You Ready to Dive into Villa Rentals in Bali?
Embark on your villa rental journey with confidence. The Balinese Villa Agency’s legal experts are available to guide you through the intricacies of property acquisition and rental operations. Book a free consultation today via the form below or email us at balinesevillaagency@gmail.com