Canggu Bali Real Estate: the Sleepy Surf Town That is Now a Bustling Tourism Capital
Any long-term resident in Bali will notice how massively changed Canggu has been in the past five years. The town has transformed from a small surf town into one of the busiest towns in Bali. There is high demand in Canggu Bali real estate for both short term rentals of tourists or long term leases for those who stay for an extended period of time.
A large portion of those who stay long term, are freelancers and digital nomads who are escaping urban areas around the world, in exchange for a tropical island lifestyle. For the business-minded, Canggu is a haven for start-up offices and international investors. In 2021, the Indonesian government considered taking steps towards creating long-term digital nomad visas and loosening restrictions on foreign investment.
Purchasing in Canggu Bali real estate as a foreigner
This massive development of hotels, beach clubs, restaurants and shops over the last few years is only the beginning of the whole development in the West Coast, where Canggu is located. Whether you want to go all in by buying land or paying for a long-term lease, know the safest way to invest in property in Indonesia. Whichever type of investment that you choose, make sure you have a solid legal ground underneath it.
Establishing a PT PMA (Indonesian legal entity) will require more paperwork and take a longer process but will also provide more features to your investment, such as a longer period of lease and rights to use the property for various purposes. But If your goal is to just have a holiday home and invest in Canggu Bali real estate that you can use or sublet within 20-50 years, signing a leasehold property contract will be sufficient for you.
Within 20 years of working in the industry, Harcourts Purba Bali have encountered all sorts of challenges. From shifting political climates to volatile markets, these affect the way we operate and collect our listings. We’d say investing in Canggu Bali real estate is a good decision to make as we know the market trend is positive and will stay positive for the foreseeable future.
The hygiene check when choosing a property
More reason for homebuyers to engage with a reliable property agent is you want to invest in a healthy investment. Property investment well-being is tightly related to its quality. And to appraise that, you want a professional to do the hygiene check for you.
At Harcourts Purba Bali, we determine home values in our Canggu & West Coast listings by doing a CMA or competitive market analysis. In this process, we look at the property location, the condition of the property, and the condition of the housing market in each area. We also take things like the age of the building, upcoming development in the area, the size of the land and property, the quality of the material, and the time when future renovation needs to be done into our consideration. This makes our Canggu Bali real estate listings a healthy investment to choose from.
We will then look at the recent price of a similar home in the area and whether the market is trending up or down in Canggu Bali real estate market. By using all of this information we can give an accurate estimate on the price of our listings.
Our in-house appraisal performers are helping property owners who want to sell or rent out their property getting the most of their investment. We put the right price for their property by looking at the current listing prices, available inventory, and the average amount of time it takes for a property to sell. This isn’t exact science, but as real estate agents, we live and breathe the markets we work in and that experience ensures you will be getting the most accurate valuation possible.
Jump into Canggu Bali real estate bandwagon
With so many options available in the market, it becomes quite a challenge to decide which property to invest in. Although real estate investment is a high risk investment, we’ve found that each type of property comes with a different set of risks. Thus we’ve categorised each property and breakdown what comes with each of it on the list below:
Off The Plan Property
This is the type of property that many moderately aggressive investors both locals and foreigners, want to get their hands on. Investors who prefer off the plan property or property development are putting their money on the future value of the property development which often offers a high profit margin.
Brand new buildings, modern home features, lower price, and the potential to yield a bigger ROI are a few variables that off the plan property provides. Rule of thumb on investment, do your due diligence before you invest in off the plan property. Check the property developer’s background, their work history in Canggu Bali real estate and the people who’ve worked with them. This to ensure your investment will not go to the wrong hands and will actually help you achieve your financial goals.
Buying a property in Canggu with PT PMA
If your aim is to build a boutique hotel, a tropical resort or a farmstay, then establishing PT PMA is essential for you. You are going full on investing in Canggu Bali real estate. Having a legal entity will help secure your investment plan for more years to come.
Look into our hand-picked listings, our land for sale and villa for sale listings are selling out fast. Contact our agents to learn more about the property that you like. Harcourts Purba Bali can connect you with the right people in the industry you want to invest in.
Long-term and Short-term Lease Property
This option is suitable for conservative investors who don’t want the hassle of establishing a PT PMA. As a foreingn investor in Canggu bali real estate, your tenancy agreement will be your legal ground and must be signed in front of an authorised notary.
A prominent real estate agent will have included these variables in the agreement. We put this here as your reference. Scrutinise your tenancy agreement before you sign it, here are the variables you need to see on the agreement:
Terms and conditions on deposits, bills and rent payments
A tenancy agreement will also set out the required deposit amount and how it’ll be protected. This will help landlords cover the damage cost. Tenancy agreement should outline the scenarios in which a deposit can be partly or fully withheld or returned and the conditions when that need to happen are included in the agreement.
It also should mention who will pay for the utility bills, banjar fee, Balinese house ceremony and daily offerings, yearly tax and other fees. Some landlords will be happy to include all those fees to the rental price, although in most cases, you’ll be liable for utility bills (water, gas, electric) and bills for things like phone and internet.
The tenancy agreement must explicitly state the price of your rent and how it’ll need to be paid, as well as information on how and when the rent will be received. Will you be able to extend the rent? And for how long? The start and end date of a tenancy will be set out and information on whether a tenancy can be ended early and how this can be done should also be outlined.
Repairs and decorating
Outline who’s responsible for minor and major repairs. In some cases, landlords will prefer to do this themselves or get the letting agent or property management company they employ to arrange repairs for them. It’ll also be made clear whether or not you’re able to redecorate and whether you need permission for this. As well as rules on changing the paint colours, garden maintenance and adding your own furniture.
This is the area that is often the cause of misunderstanding. It should be made clear in your tenancy agreement whether you’re allowed to sublet the rental and whether the property has the permit needed to be sublet (has Pondok Wisata permit). This is a very individual decision, with each landlord having different stipulations for their tenants. This will not only secure your investment in the holiday home but also to put your landlord in the know when they see different people staying in the property. The landlord will need to inform the Banjar so they can help look after the security around the property.
Making changes and giving notice
This is the term you want to have on the agreement whether as a tenant or as landlord for when a party wants to make changes on the agreement due to a certain reason. The reason could be anything, from changing jobs to a divorce. We never know, so it will be good to have this term in the agreement for both parties’ peace of mind. Do emphasise that each party must have a very compelling reason to make changes on the agreement. Each party also must state how much notice you need to give if you want to end or extend your tenancy and within what timeframe.
What will happen when you have to return to your country and can’t come back? Will the rental period continue or be put on hold whilst your landlord can rent the house to someone else? What will happen when the house catches on fire? Will you have to repair the damage? Or will you get your payment back? What causes of fire that will allow each party to get what they deserve to get? These are the sorts of questions that a thorough, comprehensive tenancy agreement will answer, putting it down in writing to ensure there can be no confusion.
Let’s execute the plan
Investing in an exotic place like Bali in an exciting plan to have. It’s in your best interest to ensure you understand what you get yourself into. Contact our real estate experts to learn more elaborative information on Canggu Bali real estate market. We’ll make sure your Bali investment matches your plan.
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