Bali property heats up as Asian investors chase high rental yields in post-Covid revival

Buyers from Hong Kong and Singapore, where rental yields stand in the low single digits, are showing particular interest, agents say

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A beach in Bali. The housing market on the Indonesia island is gaining momentum, according to property agents. Photo: Handout

Published: 11:30am, 1 Jul 2024

Bali’s residential market is gaining traction among Asian buyers, as a tourism revival and the rise of digital nomadism boost rental yields at the Indonesian holiday hotspot.

While they have yet to recover fully to pre-pandemic levels, short-term rental incomes on the island, as measured by revenue per available night, rose 8 per cent to 1.9 million rupiah (US$118) last year. The occupancy rate reached 56 per cent, 2 percentage points higher than before the Covid-19 pandemic, according to data tracker AirDNA.

Investors from Hong Kong and Singapore, where rental yields stand in the low single digits, are showing particular interest in Bali property.

Both places are similar “in that they’re very high-ticket, low-yield markets, whereas Bali is low-ticket, high-yield”, said James Hartshorn, CEO and co-founder at Palm Developments, a Hong-Kong based developer with a growing Bali portfolio.

Affluent buyers are increasingly drawn to the south of the island, particularly on the arid Bukit peninsula, where properties are yielding 15 to 18 per cent a year, he said.

The market is buoyed by an influx of international tourists after Indonesia scrapped its pandemic travel restrictions and eased visa rules in 2022. In April, Bali welcomed 503,194 foreign visitors, up by more than 7 per cent from March and 22 per cent from a year ago, according to official data.