Bali's real estate market often stirs strong emotions in buyers, leading them to justify their decisions with various myths about investing in property on the island. To avoid making emotionally driven choices and instead focus on sound financial decisions, it's essential to recognize and debunk these myths. Here, we'll tackle some of the most common misconceptions in Bali real estate investing.

Myth: Land is Scarce in Bali

A prevalent myth perpetuated by real estate agents and advocates is that land in Bali is scarce. They argue that due to constant demand, land prices will perpetually increase because of limited land on the island and a growing influx of tourists and expatriates.


However, examining the facts reveals otherwise. While Bali's land is finite, technological advancements and strategic urban planning have enabled more efficient use of available space. Research indicates that even with the island's growing popularity, sufficient land remains to accommodate residents and tourists comfortably. Thus, the notion that "land is scarce and therefore valuable" in Bali is merely a myth.

Myth: Bali Land Prices Always Go Up

This myth is especially common in Bali, where the real estate market has experienced significant booms over the past decades. Land prices have skyrocketed in many regions, leading many to believe that property values will always rise.


However, this belief is not universally true. Like any other market, Bali's real estate is subject to fluctuations. Economic downturns, changes in tourism trends, and regulatory shifts can all impact property values. Thus, the idea that "Bali land prices always appreciate" is a myth. Real estate values are influenced by numerous factors, including the overall health of the economy and market dynamics.

Myth: Past Performance Predicts Future Performance in Bali

Many hopeful real estate investors in Bali assume that past market trends will continue indefinitely, leading to overly optimistic future projections. However, the past decade has seen significant economic shifts, including changes in global tourism patterns and regulatory updates, which have affected Bali's real estate market. Unless a similar economic revolution occurs, it is unlikely that past performance will be replicated in the future. Investors relying on a repeat of previous trends in Bali may face unpleasant surprises.

Myth: Real Estate Investments in Bali Can Be Flipped Easily

Before market corrections, success stories of real estate millionaires in Bali who made fortunes through property flipping were common. These individuals promoted the idea of buying and selling properties quickly to capitalize on price differences.


However, these narratives often overlooked the significant transaction costs associated with real estate deals in Bali, typically ranging from 2% to 5% of the property's value. Additionally, finding buyers and negotiating deals is time-consuming and resource-intensive. Therefore, frequent property flipping can lead to substantial financial and time losses, making it an impractical strategy for most investors in Bali.

Myth: Buying is Better Than Renting in Bali

The emotional connection people have with owning property leads to the widespread belief that buying is always superior to renting in Bali. Historically, purchasing real estate has been seen as a milestone of adulthood, implying economic security.


Financially, however, this is not always the case. Whether buying or renting is better depends on individual circumstances, including the length of stay, financial stability, and market conditions. Each option has its advantages and disadvantages, and the best choice varies from case to case. A detailed discussion on the rent vs. buy decision in Bali will be covered in a future article.