Bali: the nomad paradise keeps its price advantage

We do not publish a Balinese rent index: we have not found an official Indonesian series publishing rents by area, and we do not reproduce platform estimates.

What can be stated concerns the structure of the market. The supply aimed at foreigners in the south of the island — Canggu, Seminyak, Ubud, Uluwatu — has developed around almost entirely external demand.

This demand pays in hard currencies and is not very sensitive to local prices, which has decoupled these areas from the rest of the Indonesian market. Rent levels there bear no relation to Balinese incomes.

The price advantage therefore remains fully intact outside these areas, and has largely disappeared within them. A newcomer comparing Bali with a European city needs to specify which Bali they mean.

Rentals there are also often offered on a yearly basis payable in advance, sometimes for several years, which creates a cash-flow constraint and a counterparty risk.

It should be added that the cost of living in Bali excluding housing remains well below European levels for those who consume locally. The gap closes quickly as soon as European habits are reproduced — imported food, international restaurants, Western services.

A stay of more than 183 days¹ over twelve months triggers Indonesian tax residency, whatever visa is held.

The calculation method is strict: the period is assessed on a continuous or broken basis, and any part of a day counts as a full day. Regional round trips therefore do not suspend the count.

The scale resulting from the tax harmonisation law ranges from 5%² to 35%³, by way of 15%⁴, 25%⁵ and 30%⁶.

Dividends paid to a resident individual bear a final withholding of at most 10%⁷, and the corporate income tax on resident companies stands at 22%⁸.

A remote worker settled long-term therefore becomes, in law, an Indonesian taxpayer taxed on a scale that is in no way advantageous. That is the reality the cost-of-living story conceals.

Freehold land ownership is reserved for Indonesian nationals. A foreigner can hold only a right of use or a right to build, granted for limited, renewable periods.

Nominee arrangements are unlawful: the courts penalise them, and the foreigner loses everything, with no effective remedy. This is the most serious risk in Balinese projects.

The local authorities have also started inspections of undeclared accommodation and of the planning compliance of buildings, several projects having been built on agricultural land without authorisation.

Water and waste management have also become local public issues, the resource being under strain in the densest areas. These constraints are shaping forthcoming regulatory decisions.

Finally, road congestion in the south of the island is a daily constraint that short-term visitors underestimate. Journeys there are long and unpredictable, and this factor weighs on the choice of neighbourhood far more than rent does.

• The price advantage remains outside the international areas of the south, not within them.
• Annual leases payable in advance are a cash-flow constraint and a counterparty risk.
• The threshold of 183 days¹ is quickly crossed, since any part of a day counts as a full day.
• The scale reaches 35%³: the island is not a low-tax jurisdiction.
• A foreigner does not own the land, and nominee arrangements are unlawful.

The practical conclusion is not to give up on Bali but to go with your eyes open. Those who live there well and for the long term are those who have accepted holding a right of use rather than ownership, declaring their income when they are resident, and settling outside the areas where foreign demand has set the prices.