If you’re looking to invest in a property overseas, Bali is a great option. The tropical climate, stunning beaches, and relaxed culture make it a popular destination for tourists and expats alike. However, as with any foreign investment, there are some things you need to be aware of before you buy a villa in Bali.
In this article, Harcourts Bali will outline 21 tips to help you safely buy a villa in Bali as a foreigner and avoid any problems or misunderstandings.
When you buy a villa in Bali (or anywhere else), it’s important to have realistic expectations about what you’re getting for your money. The price of villas can vary greatly depending on the location, size, age, and condition of the property. Be sure to work with a reputable real estate agent who can help you find a villa that meets your needs and budget, and thoroughly check the legal aspect of your deal.
Be realistic about properties and building possibilities in Bali: the tropical climate is a blessing for tourists but has a side effect on buildings. The wood gets moldy if not properly treated or eaten by termites, heavy rain creates leaking in ceilings and the gypsum falls down, possible earthquakes apply restrictions and many other factors.
While it is absolutely possible to research the market yourself simply by driving around or going online on OLX or Facebook, you will be surprised and overwhelmed when the avalanche of irrelevant offers and unexpected calls will descend on you.
The local owners or their friends (who speak English and are helping family members or a friend to sell their villa) will call you constantly, and send you voice notes and messages, and only 10% of all these offers will be actually relevant to what you’re looking for.
After a week of such pressure, you will be burned out and frustrated. To save your time, delegate the process to the agent. At Harcourts Bali, we have already manually preselected more than 200 properties for all budgets and buyers, including long-term rent, villas for sale, land plots, and commercial property.
However, before making any decisions, it’s still important to do your research and ask around. Talk to friends or family members who have purchased a property in Bali, or look for reputable real estate agents with experience dealing with foreign buyers and extensive knowledge of the local market.
It’s also a good idea to read up on the latest laws and regulations regarding property ownership in Indonesia, as well as the latest property market overviews. This will help you avoid any potential problems down the road.
The ownership in Bali will probably be something new to you and you will have to talk to a lawyer and read some detailed guides on it. It is very different from what most western countries are used to, especially considering that here, we will be purchasing land or villas as foreigners. This raises a lot of questions.
Read first our article on ownership explained. Simply put, foreigners can legally buy a villa in Bali, yet it will be a time-limited contract – from a few years to up to 80, and that is called leasehold. Foreigners cannot own the land indefinitely, only Indonesian citizens are allowed to acquire such titles.
You will have to decide either to buy the villa under your name and in this case, you have less protection but it is still completely legal, or to set up a company in Indonesia and buy a villa for an extended period of time to be fully protected by the law.
When choosing a villa, be sure to pick a location that suits your needs and budget. If you’re looking for a quiet and relaxing place to retire, then you’ll want to avoid areas that are popular with tourists and party-goers and buy a villa in Pererenan, Ubud, West Coast, Nusa Dua, East coast, or Jimbaran.
Conversely, if you’re looking for an investment property that will generate rental income, then you’ll want to choose a location that is popular with tourists and has good infrastructure like Canggu, Kuta, or Seminyak. Jimbaran and Uluwatu are highly yielding areas as well.
Buying a villa in Bali, especially if you are planning to rent it out, you are purchasing the reputation that goes with it. Check all the reviews and find out how the customer service, what people were saying about their stay in the villa, and what kind of issues they had.
It applies to Airbnb, Google Maps, or Booking reviews.
If you are buying the villa in Bali to live in it and you know that it was built a few years or even a decade ago, read the reviews anyway. You may discover something the owner forgot to mention or you were not even thinking about. Other people’s good or bad experiences can save you time and money.
Also, some villa owners are posting pictures on Google Maps starting from day one of the building process, which is a brilliant idea and an extremely great resource for your research – you can know exactly how it went.
It’s essential to have a good licensed lawyer on your side when you buy a villa in Bali. They can help you navigate the legal system, understand the contract documents and protect your interests. Be sure to ask around for recommendations or look for a law firm that specializes in foreign investment in Bali.
The main job you will be hiring a legal team will be due diligence – a full legal check-up of the property. Without it, do not ever put any money in. At Harcourts Purba Bali, the legal team is a part of our property agency, and our clients have access to the most experienced and meticulous lawyers.
It is vital to make sure the villa you’re buying stands on legally zoned land for residence or rental business and has IMB – a building permit. Unfortunately, some villas and even small hotels do not have any permits which will translate into a lot of problems for you.
No matter what your purpose for buying a villa in Bali, you most definitely expect a certain level of comfort. Check what is around: cafes, public areas, noisy nightclubs, a mosque, a farm, or a construction site. All of it may keep you from enjoying your sleep or day and this is something a lot of people overlook.
Moreover, if you are aiming to buy a villa in Bali with a view, make sure your view will remain untouched. Make your lawyer run the legal check of neighboring lands.
For living in a Bali villa, you have to make sure it was built properly, respecting all building standards and using the best practices available today. Building in Bali is a very different experience from western countries.
Find out who built the villa, what year, and how durable is the structure. If the villa stands on rice fields it must have deep bore piles that prevent the foundation from shifting and significantly impact the durability of the property. Besides, rice field villas should be properly elevated as flooding or rice field water contaminating your water supply won’t be something you need.
How sturdy are columns and beams in the villas? Some builders tend to omit important structural parts as most foreign clients are not builders and cannot fully check how well the builder is doing the job.
Bali is a tropical paradise, which is great for us, but not as good for housing: humidity causes mold, termites and other insects can destroy wood, and rats can lurk around. The most common issue almost every house faces every season is the leaking.
Sadly, not all properties are built with proper finishing, and waterproofing, and are not maintained over years to keep them nice and fresh.
A lot of modern and luxurious villas use finishing and materials we would use abroad: gypsum to create ceilings or mask some structural elements, paint, and wood. Gypsum has a tendency to swell during the rainy season if there are leakages in the roofing and eventually will get moldy or directly fall on you.
There is nothing wrong with paint as finishing, however, very few builders are doing it with proper waterproofing and wall preparation process. Even fewer villa managers will maintain the waterproofing layer. Very often if there is mold or some other issues, workers will just paint it over, with no special treatments.
Be very thorough and careful with freshly painted rooms and check everything you can as you’re making a big investment.
As we mentioned, untreated or improperly treated wood can attract termites. But also weather, fungus, and rot can damage the wood. Buying a wooden house or a villa with wooden furniture, check all the wooden parts of the house and be aware that you will have to treat it regularly.
Termites eat all kinds of wood, even teak wood which is widely popular in Indonesia and is advertised as termite resistant. While it truly is one of the most durable woods, it still can mold or serve as food for insects. The only possible safe wood type will be ironwood which is quite expensive to use for building.
When you buy a villa in Bali you should also plan how you will maintain it and, of course, plan a maintenance budget.
Sophisticated materials the builders were using, as well as some custom-made furniture, shipped appliances, and luxurious finishing material, will most definitely look attractive, but how much will it cost to keep it that way over 5-10-25 years? Will you be able to replace it if something happens? Some nice tiles or even high-quality kitchen stoves can take months to get shipped.
Having a pool is not a luxury in Bali, almost all available villas, especially luxurious villas for sale, will have a pool or even several.
Building a pool is a quite challenging and expensive job, as well as its maintenance. Check the pump, the cleaning systems, the material used for the pool wall and floor, and all electrics.
Maintaining a simple medium pool won’t eat up a lot of budget, yet an infinity pool with special lighting and elements will need some special attention and a pool worker who knows how to work with it.
The standard approach to building a villa in Bali is to hide as many wires and pipes as you can inside walls and floors to make the villa look aesthetically pleasing. It should be “instagramable” if you want to rent it for higher rates.
Yet, keep in mind that if anything happens, you not only have no idea of the wiring and plumbing layout, but the workers will most likely have to break the wall or the floor to get to the root of the problem. What you can do is at least, have detailed MEP plans to know exactly what goes where.
It is always recommended to have a large septic tank and high-quality water heaters and pumps as they are things that are used on a daily basis and break down easily.
Unfortunately, the overall tap water quality in most areas of Bali is not safe to drink. If you have sensitive skin or stomach you will have to install special shower and tap water filters and change them regularly.
Yet, before you move in, you should check the water source on the property. Sometimes the well is not deep enough to supply good water. It is easy to realize that something is wrong even by smelling the water.
While your lawyers will investigate surrounding land zoning, you should get first-hand experience of living in the area. Some areas may seem less welcoming and maintained. If you love walking, walking in Canggu will be a challenge, while in Seminyak there are nice wide sidewalks that go for miles.
Bali is also said to be the island of dogs and if you are afraid of them, check that on your street there are no aggressive dogs and that all dog owners take good care of their pets. Be mindful that most areas blend urban and rural and you may hear some roosters.
Being close to the beach or some facilities may determine what villa you buy in Bali. Yet, some freelance real estate agents are infamous for adding misleading information about how far the property is from the beach or major streets.
Take a car or a bike and drive around. How long does it take to get to the beach in the morning? In peak hours? Are there any supermarkets or cafes around? Finally, is the parking lot covered and well secured?
The internet in hot tourist spots is good, but it is not the general rule for the island. Sometimes even the mobile connection won’t be strong enough to use the Internet on your phone. Make sure there is a possibility to switch Internet providers.
Regarding electricity, to use the power you will have to top up your balance by buying a token. Unfortunately, some people connect to your grid without you knowing and use the electricity token you’ve paid for.
Finally, when you feel like this is the one and only villa in Bali you need to buy, you can proceed to draft a contract. Do not use standard form and go the extra mile to create a custom contract with all details of the transaction, property price, and exact conditions of the contract renewal.
You can either make a copy yourself and let the lawyers revise it or directly speak to your legal team to create a completely legal document that will protect your investments.
It’s always a good idea to ensure your investment, and this is especially true when buying property in a foreign country. The property agency will offer you guarantees and protect your deal.
No matter how well you plan, there’s always a possibility that something could go wrong. For this reason, it’s important to have a backup plan in place. For example, you may want to consider investing in more than one property or having a contingency fund to cover unexpected expenses. If you’re going to buy a villa in Bali you should also plan the maintenance and possible repair work budget, as well as exit strategies.
Wow, that is a lot of work! To successfully buy a villa in Bali you have to be very careful and very meticulous. Not always do we have time and knowledge to do so. Dealing with real estate in Bali it is highly recommended to hire a property agency for both better prices and legal protection.
For instance, at Harcourts Purba Bali we have our own legal team who only specializes in real estate in Bali and Indonesia and is working with foreigners. We have an international sales team as well to make sure we provide local expertise supported by high western standards. Our award-winning team has been selling and buying villas in Bali for more than 20 years already and is here to help you make the right choice and get one step closer to your dream house. If you’re ready to buy a villa in Bali, don’t hesitate to browse our selection of 200+ villas for sale in all areas of the island or talk to us to arrange a meeting or consultation.
Every 10 minutes, somebody buys a property with Harcourts.
We are among the world’s most respected real estate brands, with 900 offices across 9 countries. Our network of sellers, buyers and investors reaches far beyond the shores of Bali.
Trust the experts at Harcourts Purba Bali. If you are thinking of buying property in Bali, or if you have been trying to sell your villa, ask us what we can do for you!
These listings are hand-selected by us because they are extraordinary properties that are priced to sell. Some are exclusive Harcourts listings reserved for us and our clientele, while others were chosen because they are exquisitely designed or located in the most enviable locations.
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