Bali's Villa Market
By Marian Carroll
KUTA, Bali, AAP - Australian villa owners say Bali's property market is more resilient than that in their own country, as the global financial crisis worsens.
The island's villa market has experienced exponential growth in recent years amid record tourism numbers, with villas in prime locations going for up to $US3 million ($A4.62 million) off-the-plan.
Asia-based expatriates seeking a holiday home cum rental property have driven the buying. With foreigners banned from bank financing, they pay cash, giving Bali some insulation from the credit crunch hurting other markets, property agents said.
Major hotel projects have been abandoned, enquiries are drying up and supply of villas on the market is increasing, but there's no widespread panic-selling, they said.
Half-finished estates offer the best bargains, particularly around the fast-growing Bukit Peninsula overlooking Bali's famous surf breaks. Desperate to complete projects sold off-the-plan, developers are discounting villa prices by up to 20 per cent.
Otherwise, prices of independent villas remain fairly stable, at least for now.
"Like anywhere else in the world we are feeling the downturn, but the villa market is still strong," said Shush Ingram from Bali Property Consultancy.
But while wealthy Europeans, Americans and Russians sniff out buying opportunities, Australians have been priced out of the market following the crash in the Australian dollar.
Many have backed away from deals to buy villas priced in US dollars - now some 40 per cent more expensive. On the flipside, the US dollar's strength offers those Australians who already own Bali property an opportunity to cash in and buy cheaply back home.
"Everybody is now deciding to sell before things get any worse, and because now would be nice to get some US dollars," said Marcus Fenton from the Jimbaran office of real estate chain Exotiq Properties. He is marketing some 60 villas listed by Australians.
For long-term Bali residents David and Robyn Schonell, the currency gain is a sweetener, but their decision to list their villa less than a year after finishing construction is mainly to take advantage of falling values in Perth.
"We've got no debt and we're probably going to double our money here, so we can buy a property in Australia and still have enough money leftover to buy a bit of land here, and do it all again," said David, who runs a pearling operation in Bali.
"We're not in any hurry though. We've got a pretty hefty price on ours and if we don't sell we couldn't care less." The Schonell's are looking for $US900,000 ($A1.39 million) for their 470 square metre house, which sits on a large block 150 metres from the beach in Canggu, an expatriate enclave north of Seminyak, Bali's priciest location.
Perth businessman Alan Morgan is similarly bullish about a project he is financing and consulting on, Batubelig Residences between Seminyak and Canggu. He has built two villas that sold off-the-plan to expatriates in Dubai and Jakarta for $US1.2 million ($A1.85 million) and $US1.5 million ($A2.31 million). He recently raised the remaining two villas by $US100,000 ($A153,964.59) each to reflect higher construction costs.
"I'm not at all concerned," said Morgan. "I think Bali's real estate market is holding up definitely better than Perth, particularly at the top-end. The average growth on land value in Seminyak is about 25 per cent a year."
Returns like that have attracted a stampede of foreign developers and investors over the last decade, sparking nationalist outcry from community and political leaders who urge Balinese not to sell ancestral lands.
Although Indonesian law bans foreign ownership of land, villa investors commonly circumvent this by using an Indonesian nominee, sometimes recommended by their lawyer or adviser.
The nominee signs over practical control to the foreigner through various contracts including power of attorney and a fictitious loan agreement.
Real estate agents say it's a watertight scheme. But legal uncertainty and corruption accompany any investment in Indonesia, and there have been instances of nominees gaining legal control of properties.
Concerns have also been raised by fresh allegations that a business consultancy - partly run by expatriates - has failed to disburse millions of dollars belonging to clients to settle land and property acquisitions.
"I wouldn't say these kinds of things never happen, but they aren't common and you've just really got to do your homework," said Ingram. But David Schonell said the returns are worth the risk. "Just the price of our land has gone up threefold since 2005 when we bought it. Like any business decision, we've just got to be smart about it," he said.
"If you do it the correct way and you do all your due diligence on the property, your research into the nominee and put together all the appropriate paperwork, then I think it's a very secure investment."
Posted on 02 Apr 2009 by Steve
Private Paradise
March 28, 2009 - 12:00AM
Sheriden Rhodes surveys Bali's luxurious villas - with staff, space and seclusion.
In Fiji you stay in bures and in the Maldives it's over-water bungalows but in Bali, the stylish choice is villas: privately owned, stand-alone, in clusters within exclusive compounds or plush hotel villas with all the trappings of a resort. Many come with their own staff - butler, chef and driver - while nannies and masseurs are a phone call away.
There's been a rush of new villas, fuelled by investor confidence in the island, and Australian arrivals are at an all-time high.
What differentiates a villa stay from holidaying in resorts or hotels is space, privacy and exclusivity. There's no fight for the best sun lounge, no need to share your pool with other guests and you can more or less set your own timetable: what you'd like for breakfast and when, what type of cuisine you'd like your chef to prepare, when you'd like to go shopping. If you want to have dinner at 9pm by the pool after you've put the children to bed, villa staff are more than happy to accommodate.
We've scoured the island and found a selection of outstanding villas in which to drape yourself on a day bed, gaze into the distance and sip an arak madu - a Balinese signature cocktail made from arak, honey and a slice of lime - amid tropical glamour with your favourite people.
Entry-level villas
For the cost of a five-star hotel room, you can have your own secluded pad with pool, staff and room to move.
Villa de Daun, set back from the bustle of Jalan Raya Legian, bills itself appropriately as "Kuta's little secret". These 12 stylish villas (with one, two or three bedrooms) in a lush garden compound and each has a private swimming pool, outdoor leisure area, personal butler, kitchen, luxurious linen, kimonos and more. There's a chic reception area, a cafe and De Daun Restaurant but best of all is the sweet Dala Spa. Browse the shops nearby and then book a 21/2-hour Royal Wedding Ritual, which includes a Balinese massage, Javanese lulur, yoghurt body polish and a milk and flower bath.
Four nights in a one-bedroom villa, including daily breakfast, return air fares with Garuda Indonesia and transfers, cost from $1746 a person ex-Melbourne and $1761 ex-Sydney in low season. Phone 1300 365 331 or see balionanybudget.com.au.
The Gangsa, part of Bali's Kayumanis group, has 11 spacious villas in a secluded compound in a back street in the beachside suburb of Sanur, where tourism took off on the island in the 1970s.
The villas are nowhere near the beach but what they lack in location is made up by incredibly helpful staff, on hand to fix Wi-Fi issues or deliver a clean cot sheet at 1am. Nothing is too much trouble. And there's an air-conditioned car and driver to whisk you to the property's laid-back beach club at a moment's notice. These charming villas have private swimming pools, outdoor dining and living areas, spacious bedrooms and outdoor bathrooms. The presence of the on-site Gong restaurant (try the ayam sere lemo, roast chicken salad), lounge bar and spa mean you never need venture outside the compound, although staff are more than happy to recommend and book restaurants or tours for you. A one-bedroom villa costs from $US330 ($480) a night. Guests booking for three nights receive the fourth night free plus a spa treatment. Book for five nights and get seven nights including a spa treatment and dinner. Phone +62 361 270 262 or see thegangsa.com.
Mid-range villas
Round up the gang and split the cost of a holiday in these deluxe villas.
The new, Moroccan-inspired Space Villas, within strolling distance of the shops and restaurants of trendy Seminyak. With soaring roof lines covered in traditional alang alang (thatched roofing) and contemporary fittings, the six spacious two-bedroom villas have king-size beds, outdoor bathrooms reached via huge walk-through wardrobes, upstairs living rooms, fully equipped kitchens and gorgeous pools with day beds and sun lounges. If you're travelling with babies, they'll sleep in handcrafted wooden cots with mosquito nets. Open the Balinese doors at the end of the pool and double the number of bedrooms.
The best thing about Space and the older sibling next door, the more affordable Serene Villas, is their location. Turn left outside and you're in the heart of Bali's best boutique shopping along Jalan Laksmana, with the beach and restaurants within walking distance.
A two-bedroom villa and breakfast costs from $US400 a night in low season (plus 11 per cent tax and service charge). Phone +62 361 731 100 or see spaceatbali.com.
The airy two-storey Villa Vajra Ubud is in the middle of lush rice fields, just north of Ubud. The three-bedroom pavilion and the separate, romantic, one-bedroom Villa Sati are owned by two US businessmen and managed by BHM, a well-respected villa management company in Bali. Lower yourself into a heady flower bath on arrival and listen to the sounds of the jungle. There's a pavilion perched over the River Oss for yoga and meditation and your own open-air lounge for reading and relaxing. When you can rouse yourself, take a scenic walk to Sunset Hill to experience local village life and take in the beauty of Ubud's rice fields.
Villa Vajra costs from $US550 a night and Villa Sarti from $US215 a night in low season (plus 15 per cent tax and service charge). Phone +62 361 730 668 or see villavajra.com.
Karang Kembar Estate is a stylish cliff-top pad overlooking the Indian Ocean in the exclusive area of Bukit. It is owned by an Australian who lives in Hong Kong and its secluded location on Bukit Peninsula makes it ideal for groups wanting to escape the bustle of Bali's main tourist spots. Decorated in neutral tones with eclectic artwork and antiques, the five-bedroom villa has three separate pavilions: a master sleeping pavilion with cute nautical-themed children's bedroom; a guest wing; and a central living and dining pavilion surrounded by landscaped gardens. It sleeps eight adults and two children. Wake to ocean views from your private sundeck, recline on funky love chairs designed for two and bathe in a sunken bath surrounded by lanterns in a flower-fringed courtyard. Start the day with an egg-white omelet and fresh juice served by your own chef beside the infinity pool. For dinner, tuck into pepes ikan (fish cooked in banana leaves) in the living pavilion with its floor-to-ceiling folding glass doors. A team of eight staff provides discreet service and a car and driver are on hand to take you to the estate's private beach club or the shops. A Karang Kembar villa costs from $US775 in low season (plus 15 per cent tax and service charge). Phone +65 9018 1742 or see bali-karangkembarestate.com.
Blow-the-budget villas
Pantai Lima is an estate of five jaw-dropping villas with beach frontage in the tiny fishing village of Pererenan, just north of the popular expat area of Canggu. It is managed by French couple, Mathias and Gaelle Echene, who own two of the villas. No expense has been spared in the fit-out. Each of the villas, of 2500 square metres, has contemporary and antique Javanese furnishings. There's a floodlit tennis court, vast landscaped gardens that can accommodate up to 250 for a sit-down dinner, pools and spas overlooking the surf, cinema rooms, spa rooms, conference facilities, the latest in technology plus fully equipped kitchens overseen by French chef Manuel Wendling and his team of sous chefs. The blend of French nouvelle cuisine and Asian fusion food is outstanding. This is the kind of place to celebrate a milestone, tie the knot or treat yourself and a group of family and friends to an unforgettable holiday.
Villas cost from $US1400 a night in low season (plus 15.5 per cent tax and service charge). Phone +62 361 844 4555 or see pantailima.com.
You'd be forgiven for thinking you'd arrived in the Greek islands when you check in to the impressive new Karma Kandara. Perched on a cliff high above the Indian Ocean in Uluwatu, this all-villa resort has stone bridges and pathways that meander through gardens. There are 46 privately owned one- to four-bedroom villas. A contemporary interpretation of the classic Balinese compound, the villas' two or three pavilions are built around a courtyard and private pool. The owner, Englishman John Spence, was impressed by the concept of an all-villa resort, having holiday with his young family at traditional hotels and resorts where they'd be confined to one or two interconnecting rooms. Spence, who lives in Perth, says Karma has the privacy and space people are seeking from a villa stay but with all the trappings of a resort.
And the trappings are pretty enticing: the fabulous di Mare restaurant and rooftop Temple Lounge with 180-degree ocean views; the Nammos Beach Club, on one of Bali's best beaches (reached by inclinator); and the Karma Spa, managed by the well-known Australian spa therapist, Judy Chapman. Try the spa's oxygen facial (popular among the glitterati) or an infrared sauna, in one of the world's most astonishing, cliff-hanging spa settings.
A four-night stay in a pool villa including daily breakfast, return air fares flying Garuda Indonesia and transfers in Bali, costs from $2429 a person, twin share, from Melbourne and $2345 from Sydney in low season. Phone 1300 365 331 or see balionanybudget.com.au.
The 146 "villas" in the Four Seasons hotel overlooking tranquil Jimbaran Bay, while lovely, are stretching the definition for inclusion in the villa category. Cross the road, however, and in a separate gated complex are the hotel's nine swish, two- to four-bedroom "residences".
These two-storey, thatched, Eurasian-style houses are mighty impressive. Each has a private swimming pool, library, sunken lounges overlooking lily ponds, enormous bathrooms, 24-hour butler service, beach access and more. Two-bedroom "residences" cost from $US1800 a night in the low season (plus 21 per cent tax and service charge). Phone +62 361 701 010 or see fourseasons.com/jimbaranbay.
Other stylish villas Villa Maya: a four-bedroom riverside villa in the traditional village of Cepaka. From $US650 a night in low season; see villamayabali.com. The Viceroy: 11 one- and two-bedroom villas and a gorgeous spa have dramatic views overlooking the Ubud valley. From $US660 a night; see slh.com/viceroy. d'Omah: a charming and affordable hotel villa complex of 18 rooms, with lap pool and contemporary Indonesian art, a 10-minute walk from central Ubud, plus the recently renovated four-bedroom Annex to d'Omah. From $US50 a night; see ubud-accommodation.com.
FAST FACTS
Getting there
Garuda flies to Denpasar non-stop from $650 return from Melbourne and Sydney. Jetstar flies non-stop from Melbourne and Sydney; one-way fares from Melbourne start at $373 and $369 from Sydney (not including tax). Australians can obtain a visa upon arrival for $US10 ($14) for stays up to seven days and $US25 for stays up to 30 days.
Low season for airlines is generally considered outside Australian school holiday periods, while low season for Bali hotels and villas tends to be outside the northern hemisphere summer and Christmas/new year season. Check individual websites for exact dates.
Villa checklist
* Decide on your budget and location: beach, rice fields, mountain or city? And determine what villa size you need: a romantic one-bedroom villa for two, or a complex of interconnecting villas that can sleep dozens for a wedding or birthday?
* Surf the internet and make a short-list of appealing villas and special deals (such as pay for five, get two nights free) and extras such as spa treatments, meals and transfers.
* Ensure the villa has the facilities you need. Cots, mosquito nets, a car and driver, masseur, chef, electronic equipment such as DVD players, sound systems and Wi-Fi access are often available but check.
* Read independent villa reviews at tripadvisor.com, or browse the latest Bali Luxe Guide, a great reference to eating, drinking, shopping and villa stays on the island. See luxecityguides.com.
* BYO alcohol. A government crackdown on illegally imported alcohol and a tax hike on alcohol means there's been a shortage of wine and spirits and when available, prices are exorbitant. Visitors can arrive with one bottle of wine or spirits each. The cost and availability of beer seems unaffected.
* Well-priced packages, including air fares and accommodation, are available though Garuda's wholesale arm, Garuda Orient Holidays. See balionanybudget.com.au.
Posted on 27 Mar 2009 by Steve
Bali airport to get US$111.6m upgrade
January 7th, 2009
Indonesian Vice President Jusuf Kalla said Bali´s Ngurah Rai international airport will be expanded under a project to be started in April 2009.
“The expansion project will have to be started not later than April 2009 and the next three months should be used to prepare the tender. The project should be completed within two years´ time,” Kalla said after a meeting to discuss preparation for the project here Saturday.
The meeting which took place at Ngurah Rai airport was attended by Transportation Minister Jusman Syafil Djamal, Culture and Tourism Minister Jero Wacik, Bali Governor I Made Pangku Pastika and some local officials.
“The budget provided for the construction of international terminal may reach Rp1.2 trillion (US$111.6 million). If tendered, the bidding price may decline,” Kalla said.
Asked about the financier of this project, the vice president said airport management company PT. Angkasa Pura and Bank Mandiri were ready to finance the tender.
Posted on 23 Jan 2009 by Steve
Bali to plant one million trees in 2009
December 3rd, 2008
Bali will spend nearly Rp 400 million (US$3,200) to plant the seeds of 1.35 million trees next year, as part of the central government’s plan to “green up” the island in anticipation of environmental disasters.
The seeds, including chestnut and mahogany, will be planted inside and outside forests all across Bali, said Dewa Dharma Putra, head of the environmental division of the province’s Regional Development Planning Agency.
“However, this is just the number of seeds we will plant, we cannot foresee how many of them will actually grow into trees,” he stressed.
Dharma Putra said areas such as southern Badung suffered from a lack of absorption areas, making them prone to floods, while other areas, such as the Seraya district in Karangasem Regency suffered from extreme drought, which might lead to fires.
He added that the areas were categorized according to the state of their degradation, from extremely critical to critical to slightly critical and so on.
“Karangasem has one of the widest critical areas, while areas in southern Badung such as Kuta, Pecatu and Nusa Dua are also categorized as critical and are among our main priorities.”
The southern Badung area is the island’s main tourism region.
The program, which is part of the Gerhan (forests and field rehabilitation movement) initiative launched by the government in 2004, actually began in Bali in 2006; it has simply been renamed the “Green Bali” program.
The aim of the program is to plant local trees and reduce deforested areas in Bali by a minimum of 9,000 hectares every year.
The latest report from the agency revealed that 20,000 hectares of land in Bali remain in critical condition, a reduction from the 55,000 hectares identified in 2004.
He further estimated that as many as 2.5 hectares of the island’s mangrove forests - also a target of the “Green Bali” program - remain in critical need.
When asked about the exact impact of the “Green Bali” movement, Dewa Dharma said several regional agencies, which include the provincial, regional and municipal forestry agencies were still working on identifying the newly improved areas.
“According to our temporary data, there has been a significant reduction in the number of critical areas, but we’re still re-capping the exact number. We are doing this along with the identification phase,” he said.
This latest data, he said, would serve as a guideline for the agency’s future “Green Bali” program, including setting benchmarks of how many of the trees should be planted each year.
Meanwhile, Putu Subagiartha, head of the Bali Regional Development Planning Agency, hoped the re-planting program could increase the island’s attractiveness to tourists.
“We have to prove that we can conserve our environment as well as develop our tourism industry at the same time,” he said.
Posted on 09 Dec 2008 by Steve
Paradise Found
Bali is still holding up strong although the financial crisis has affected its property market in some ways.
Continuing the trend that has seen some marvelous property investment opportunities in the last 15 years in Southeast Asia, Bali has enjoyed a healthy growth in land development and villa sales through a marketing tool as simple as tourism. Prior to Soeharto’s fall in 1998, the market was relatively closed to the public sector (with the exception of privileged land owners, including the local Indonesians, large hotel chains, well-connected expatriates and major project’s placed by the wealthy from Jakarta) that to this day still bear their marks but have not been completed. There was oft many a story of ‘cowboy’ lawyers, land being sold ten-times over, and foreigners being ripped off, never understanding or being educated clearly as to their rights regarding land ownership.
After Soeharto fell, the country saw its first right to vote for over decades. Momentum and confidence picked up, which also included improved legal information and service, as well as a vast range of imported goods, no longer ‘held’ in franchises by the first family, or highly taxed and levied by the same. The market literally swung open in all senses of the term.
Building materials came in ready supply, and available on Bali, at reasonable prices, as did imported fixtures and fittings as well as interior furnishings. In fact, all these items, combined with the rich local resources and talents of local craftsmanship, created a stunning combination that even few villas and developments outside of Bali could boast at such reasonable rates. Interestingly enough, after two world-headline-hitting bombs, and continued travel warning advice, the market in Bali has never witnessed a slump, nor a drop in land value. On the contrary, Bali is an unleveraged market place that has a basic, healthy four to 15 per cent return of investment (ROI), if not more, in certain fashionable areas.
The Bali bombings actually assisted in several ways; firstly on placing Bali on the world travelers’ map once again. Up until 2002 (the date when the first bomb hit), Bali was losing out on the competitive tourism market to such places as Thailand, Vietnam and Cambodia. These countries’ national growth are heavily placed in tourism, with each government having invested heavily into the industry, while Indonesia was seriously lagging behind. Secondly, the bombs helped to change the face of the tourism market, swinging it heavily to the boutique hotel and villa style accommodations rather than the large hotel chains who were seriously affected by the ensuing travel warnings. With that, a more financially independent, discerning and affluent style of visitor arrived.
The more recent visitor to Bali has serious means to look at villa investment opportunity as a second or even third and fourth home purchase. Not working on the traditional real estate model, and having a more transparent market, the demographics point to the young, financially mobile buyers snatching the opportunities in purchasing a piece of paradise, virtually nonfinanced, and bringing in guaranteed ROIs of up to 8 per cent per annum and in some cases up to five years. Those who want to flip, have seen profits of as much as 25 per cent within 18 months.
Developments on the ‘island of the Gods’ have multiplied in the last six years, with various real estate offices popping up all over the southern part of the island – a sign that things were shining as bright as the tropical sun itself, and that things were heating up accordingly. Legal handlings of land acquisition as well as foreign investment became tangle free, run of the mill, and the thirty-day due diligence now enforced and habitually used, protected both the vendor
and purchaser against any shady factors.
As project development increased, so has the infrastructure of the island, with delicatessens, restaurants, bars and countless shopping arcades opening everywhere. As each development is being built and sold off, it is little wonder that the island is soon to witness a year end record breaking figure of 2 million visitors – even with the once again enforced travel warnings, due to the now closed chapter of the execution of the bombers at the beginning of November.
The expatriate community has therefore increased by over 30 per cent in the last six years (it did witness a slump of 20 per cent in 2002 to 2003) with a number of schools opened or expanded. The hospitals have all been upgraded, with one of the busiest foreign owned medical centre recently transforming into an impressive private hospital in Kuta. With these services, it is no wonder that there are little signs of development slowing down, given the additional flights
that have been put on from various surrounding countries, as well as the fact that Australia is seen politically supporting the impending Indonesian general election of 2009. It threw in AUS$6 million in support of the country’s newfound democracy.
With all that, it is not to say that certain developments have not witnessed contract cancellations, or a slowdown. The world’s economic crunch has produced a ripple effect, that is slowly lapping its way to Bali’s shores, but just not in the same full on way that it has affected mortgage financed countries. The first sector, tourism, should have been a healthy indicator that all was not well. As of print time, the year end is looking amazing, with hotels and villas looking at sure bookings of 80 per cent, with the overall average being around the 70 per cent mark for the year.
The biggest growth market has been Russian, who favour the developments in the Jimbaran and Nusa Dua areas. The Australians, who have pulled back on investment at this time of writing due to the weakening Australian dollar, favour the Seminyak area, with Batu Belig, Kerobokan, Umalas and Canggu coming in with the developments that are offered out there.
Being a leisure market with all growth virtually coming from foreign investment, both on the development and acquisition side, the market still holds the potential to retain its upward curve, as price points remain steady. Compared to other leisure markets in the region, Bali is still amazing value for money and can offer outstanding settings.
Bali remains a paradise found, one that is definitely not lost yet.
Posted on 05 Dec 2008 by Steve
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