Buying an Oceanfront Villa in Bali: 7 Critical Factors

Uluwatu oceanfront villas investment attracts many wealthy individuals. It is a great opportunity to invest and grow money.

In 2025, prices for oceanfront villas in Uluwatu increased by 22%. But the picturesque view is not the only factor to check before making a deal. Let’s review the key factors to pay attention to.

Factor 1: Location: Where View = Liquidity

The Ocean view villas Bali buy guide states that you should start with the location choice. Let’s list the most promising options.

Top 3 Zones:

• Uluwatu – cliffs, surfing, +18% per year
• Canggu – trendy lifestyle, but less privacy
• Sanur – gentle water entry (perfect for families)

Prices for villas in Uluwatu (Bali) continue to rise in 2025, reflecting high demand from tourists and investors.

The average price range is $277,000 - $770,000, depending on area, location, and finish level. The price per square meter for high-end villas ranges between $3,000 - $4,000.

Be aware of possible risks: always check construction plans to ensure your view isn’t blocked by a new hotel. Always look into the future.

In Canggu, beachfront villas in areas like Berawa, Echo Beach, and Batu Bolong typically cost more than those deeper into the resort. For a 4-bedroom property, the average price ranges from $600,000 to $1.4 million.

Villas in Sanur range from $700,000 to $1.8 million.

Factor 2: Legal Status of the Land

Study Bali property ownership laws for foreigners.

Ownership Options:

• Freehold (Hak Milik): Full ownership – prohibited for foreigners.
• Leasehold (Hak Sewa): Long-term lease, up to 25–30 years with the possibility of extension to 80 years.
• Right to Use (Hak Pakai): Right to use land as a resident.
• Nominee Ownership: Risky and not recommended – ownership under an Indonesian citizen’s name.
• PT PMA: If you open a company, this is a complex but legal way for investors.

Allowed Types of Ownership for Foreigners: Hak Pakai is one of the legal ways for foreigners to own property in Bali. This is a right to use, granted to foreigners for a specific period. It is the only form of individual ownership that can be arranged under your name without needing to set up a company or use a nominee owner.

Key Features of Hak Pakai:

Advantages:

• Legal ownership in your name.
• Option to live and rent the property.
• Transparency and protection when following the law.

Disadvantages:

• Requires resident status.
• Limited type and number of properties.
• Does not provide land rights—only building/house ownership.

PT PMA (Company Ownership): The second option is PT PMA (Penanaman Modal Asing), which is a foreign investment company through which foreigners can legally own property in Bali.

Pros: Ability to rent out property, own multiple properties unlike Hak Pakai. Cons: Requires a capital investment of at least 10 billion IDR ($650,000), with a minimum paid-up capital of $175,000, and higher annual operating costs including taxes.

Overall Conclusion: Foreigners in Bali cannot own land directly but can own buildings or lease land for an extended period. Legal assistance is essential. Best real estate agents Bali can help resolve this issue.

Always perform a property check through a Notary Public Bali for encumbrances.

Factor 3: Construction Risks

When forming a Bali luxury villa purchase checklist, analyze construction risks:

• Corrosion: Salt air deteriorates metal within 3-5 years.
• Drainage: Heavy rains can erode foundations (e.g., "Villa in Bingin requiring $50K to reinforce slope").

Factor 4: Hidden Costs

When planning to buy a villa in Bali, don’t forget about hidden costs that increase the initial price. These include:

Purchase tax: 5% of the cadastral value.

Annual fees: $2,000+ for infrastructure maintenance.

Operating expenses include:

• Cleaning, pool maintenance, security
• Utility bills (water, electricity, internet)
• Property management commission (usually 15-25%)
• Taxes (10% VAT, 10% service fee if renting out officially)

Approximate monthly maintenance cost for a 3-bedroom villa: $600–$1,200/month.

Think about whether you are ready for such expenses and consult with experts if necessary.

Factor 5: Rental Potential

Analyze the rental potential of the villa you plan to buy.

The highest income-generating areas are: Canggu, Seminyak, Uluwatu, Ubud.

Family-friendly and quieter areas: Sanur, Nusa Dua, Jimbaran.

Check proximity to: beaches, cafes, yoga studios, surf schools, nightlife.

Property Type and Layout also matter:

• 1-2 bedroom properties are often chosen by couples, digital nomads.
• 3-4 bedrooms are ideal for families and are perfect for long-term rentals.
• 5+ bedrooms are for large groups and VIP guests.

Villas with private pools, working spaces, and BBQ areas are in high demand.

ROI Calculation:

3-bedroom villa in Canggu:

• Purchase price: $300,000
• Average rental price: $250/night
• Average occupancy: 65%
• Gross annual income: ~$59,000
• Annual expenses: ~$12,000
• Net profit: ~$47,000
• ROI: ~15.6%

Another Example: "A villa for $1.5M in Pekatu rents for $800/night, with a 65% occupancy rate."

Gross annual income: $189,800/year

Operating expenses: ~$83,430

Net profit: ~$106,370/year

ROI: ~7.1% per year

Payback period: ~14.1 years

7.1% ROI is a decent figure for the high-end segment, with a payback period of around 14 years—typical for premium properties with a limited number of renters.

Also, keep in mind the risk factor: expensive villas are harder to rent out year-round, and much depends on branding, service, and promotion.

Must-haves for Renters:

• A children’s room (+15% demand).
• A content shooting area.

Inspection Checklist: When considering buying cliffside property in Bali, the investment should be well thought-out. In such cases, it's mandatory to:

Check documents with a notary.

Test water (saltiness in the pool).

Measure noise levels from waves at night.

These nuances are crucial, as you are dealing with expensive property that requires a thoughtful approach to selection.

Example Cases:

• Successful: "A Russian bought a villa in 2020 for $900K and sold it in 2024 for $1.7M."
• Unsuccessful: "A German investor didn’t consider taxes – fine $120K."

Want an individual property analysis? Send us photos of the villa and documents – we’ll audit it in 48 hours. Our experts will help you avoid scams buying Bali property and provide full legal support.