So, you are considering starting a Bali villas rentals business? We applaud your entrepreneurial spirit and also your choice of location given that Bali is one of the most idyllic and popular tourist locations in the world. However, for all the positives that Bali offers, it is a double-edged sword because as Bali is part of Indonesia, Indonesian laws apply, which throws up several issues.
The main issue is that Indonesian laws make it illegal for foreign individuals, including Australians, to own property in that country and that unfortunately rules out the possibility of simply buying a villa and renting it out. However, such a business is possible if you follow some logical steps which we have outlined below.
Seek All The Necessary Information And Legal Advice You Can
However you proceed, we implore you not to take another step until you go through this one. A quick search on the internet will reveal stories of would-be entrepreneurs who were where you are now, and who have lost fortunes, not because the business model does not work, but because they failed to follow legal guidelines and safe methods of creating a Bali villas business.
Create A Robust Plan
Once you are 100% certain of the legal pathways to follow, then your next job is to create your business plan. There is an old business saying, “Fail to plan, plan to fail” and it is as true for your Bali villas business as it is any other. Take time to create your plan and include the goals you have for your business.
Set Up Your PT PMA
The most legitimate way for you to purchase land or a villa in Bali is via an Indonesian company which you register as a PT PMA. This company is a foreign investment company, but the importance of it is as a legal entity, you can use it to purchase property and land in Bali, including a villa.
Research Your Options Regarding Location, Villa Size, Availability
Now it is time for you to start researching what villas are available on the market. This requires careful analysis of many factors such as location, size, popularity with tourists, local amenities, zone restrictions for property use, and market prices. If this takes you some time then it will be worth it to discover the perfect villa for your business.
Purchase Your Chosen Villa
Once you have identified which villa you want it is time to set the wheels in motion to purchase it. Due diligence is essential, and you must again seek local experts to help you through the process. Factors that could cause issues such as zone restrictions and access rights also need to be addressed to ensure neither can derail your business.
Employ Staff Or An Agency To Manage Your Villa
Unless you plan to live in Bali and do this yourself, you will need staff to service the villa. You could employ locally, but be aware this means you are subject to following local employment laws. Instead, you could hire a property management agency that will have staff that can do all the necessary work.
Market Your Villa
For your Bali villas business to make money you need paying guests, so your task now is to market your villa. There are a huge variety of ways this can be done, and we highly recommend using online marketing channels. You may also want to have a website created that can augment the promotion of your villa.
