How the Tourism Boom Affects Real Estate Yields in Bali in 2024

In 2024, Bali is experiencing a significant surge in investor interest, driven by the rebound in international tourism, real estate law reforms, and stable rental returns. For property owners and buyers, this presents new opportunities, but it also requires careful analysis of taxation, infrastructure development, and demand dynamics.

The Role of Tourism in Bali’s Real Estate Market Growth

Record Tourism Drives Rentals in Emerging Areas

According to Indonesia’s Ministry of Tourism and Creative Economy, Bali is expected to welcome around 6.5 million international tourists by the end of 2024 — nearly a full recovery to 2019 levels. Most of the traffic is still concentrated in areas like Canggu, Seminyak, Ubud, Nusa Dua, and Uluwatu, but there is growing interest in lesser-known regions such as Singaraja, Tabanan, and the northwest coast.

Stable demand for short- and mid-term rentals has driven occupancy rates:

Properties in tourist zones are enjoying occupancy rates of 70–85%, based on data from Airbnb and Booking.com;
Outside of the hotspots, rentals are increasingly popular among digital nomads and relocators, which is stimulating development in new areas.

Thus, tourism is no longer just a driver but a solid foundation for long-term investment growth.

Real Estate Returns in 2024: Key Trends

The impact of tourism growth on real estate is evident in three key indicators: rising rental income, increasing capital values, and expanding demand for new segments.

Average rental yields in Bali reached 10–13% annually in 2024 — among the highest in Southeast Asia for the buy-to-let market. According to Properti Indonesia and Ray White Bali:

Residential property prices rose by 18% year-over-year in high-demand areas like Canggu, Berawa, and Pererenan;
Less developed regions (such as Bangli and Kusamba) saw growth of 8–12%, driven by new infrastructure projects and relaxed development regulations.

This combination of rental income and capital appreciation makes Bali a compelling destination for long-term investors, particularly those seeking to diversify risk across the ASEAN region.

Indonesian Property Taxation: What Investors Need to Know

Indonesia offers a relatively straightforward tax system for non-residents, especially for long-term rentals. However, there are specific considerations every investor should be aware of.

Taxes When Selling Property

In a sale transaction, the following rules apply:

The seller pays 0.5% of the NJOP — the government-assessed property value (Nilai Jual Objek Pajak);
If the property qualifies as a luxury item (valued over IDR 30 billion, or approximately $1.9 million USD), a 20% Luxury Tax applies.

These rates are competitive when compared to other countries in the region, where capital gains taxes may exceed 5–10%.

Getting a Taxpayer Registration Number: NPWP

Foreign investors planning to rent out properties can obtain a personal tax identification number, NPWP. This enables them to:

Legally declare and earn income from rentals;
Open local bank accounts and repatriate portions of their profits;
Apply for tax deductions related to infrastructure investment or renovation.

For consistent participation in the mid- and high-end rental markets, obtaining an NPWP is considered an essential part of tax compliance.

New Tourism Levy: Impact on Demand and Bali's Image

Since February 2024, Indonesia introduced a flat $10 USD tourist levy for each incoming international visitor. According to the government, proceeds from this fee are allocated to:

Cleaning natural areas and reducing waste, especially on beaches;
Preserving Balinese culture and temple heritage;
Improving infrastructure in underserved rural areas.

While the initiative initially raised concerns among tourism operators, reports from Indonesia’s Ministry of Tourism and analysis by Skift confirm that the tax had no significant impact on tourist arrivals. In fact, it helped position Bali as a sustainable tourism destination — an image that is especially valued by long-term renters and international remote workers.

Legal Reforms and Investment Attractiveness

Changes in Lease Rights and Foreign Investment Access

Indonesia continues to liberalize its property laws in 2024. Key reforms include:

Standardized leasing rights registration (Hak Sewa) — now available through digital platforms with no physical presence required;
Permission for foreigners to own property in new economic zones without setting up an Indonesian company (via Nominee Lease with Notarial Endorsement structures);
Incentive programs for development in non-southern coastal districts, particularly in Bangli, Jembrana, and Karangasem.

According to Cushman & Wakefield Indonesia, these changes could drive a 22–25% increase in foreign direct investment in the private residential rental sector by 2025.

What to Expect from Policy in 2025

The Indonesian government has announced upcoming policy additions aimed at greater transparency and accessibility:

Automatic electronic registration of lease rights through an integrated ATR/BPN platform;
Launch of an online rental income tax declaration portal;
Establishment of an intellectual property registry for unique villa design concepts.

For investors, this marks the transformation of Bali’s property market from a semi-unregulated environment to a transparent investment space, with better oversight, taxation clarity, and legal protections.

Conclusion: Rental Demand and Property Values in Bali Continue to Rise

By the end of 2024, Bali has solidified its position as a stable investment destination in Southeast Asia. A growing influx of tourists, digitization of legal processes, tax incentives, and expanding infrastructure make the environment highly favorable for investors. Key highlights include:

Annual rental yields: 10–13%;
Property value appreciation: +15–20% in top demand areas;
Simplified lease and tax procedures for non-residents.

With a trend towards a more sustainable and digitally transparent market, Bali in 2025 is emerging not only as a tourism hotspot but also as one of Indonesia’s premier long-term investment hubs.