Thread: Purchasing a homestay/bungalow type of investment.

i'm coming to look around in October. Before I come, here are a "few" questions I have

1. Is it cheaper to rent than to own a home in Indonesia? That seems to be the case in Thailand.

2.If I wanted to buy a very modest bungalow/homestay type of building how many rooms would it require to make a profit of more than 10% return on the investment?

3. How cheaply can they be purchased for?

4. When buying a property, is financing available and if so what do they require?

5.When do you feel it would be better just to pay cash than to get a mortgage?

6. What are property taxes like?

7. What is the cost of homeowners insurance?

8.Does it flood there?

9.When buying an investment property, what kind of restrictions on building and conducting business do people usually come across?

Thanks in advance for your attention to this request.

I've also heard of people who "live" in Indonesia on a Social Visa and just keep renewing that. Obviously that won't be legal if you're conducting business but if you had to choose between doing that and getting a retirement visa which would you prefer?

This then begs the question if you can own property without having a, business or retirement visa.

Sorry Bert. Preffered your old mug shot, Thats it lol

Gongchime, you need to go to Bali and spend some time there investigating your ideas, and learning about how to achieve what you want.

From the questions you are asking, it is obviously early days for you. The nature of most of your questions is similar to 'how long is a piece of string?'

Also, you cant work, or run a business on either a social visa or a retirement visa, and believe me they check.

Thanks Freo and Bert,

sorry Bert. Thought it would have been obvious from my other posts and within this post that I'm talking about scraping the bottom of the deck prices.

O.K. so if it's a matter of how many guests I can get, then how many are other people with bungalow/homestay situations getting?

I'd like it very much if someone who is actually renting out rooms would respond to the question.

So, on point 3 you seem to be saying that for a price of a luxury car in America I can get a place in Indonesia, I think.

Another question I had was how much appreciation on a building is reasonable to anticipate and how quickly.

Last of all, are there good accounting services available?

Originally Posted by Bert

Gongchime,

Do you have any experience in "hospitality" ?

I seriously doubt it Bert from the type of questions being asked - and certainly not experience in the area he seems to be interested in.

Gonchime, I know of a homestay on the beach, 40 are, 12 bungalows, a house, living quarters, kitchen & dining room, no pool or a/c, basic type of accommodation, and a bit run down. It is going for around 4Billion Rupiah. The room rates are around Rp130,000 per night and occupancy averages at around 60%. You do the math.

The price is because the land is worth so much being on the beach. If it wasn't on the beach then occupancy would be down to around 25-30%.

While land can be comparatively cheap in Bali, it is still a pretty big outlay when buying enough for a small homestay or hotel. Another option you should look at is leasing a small hotel/homestay. There are plenty available, plenty of people go bankrupt in hospitatity in Bali, so plenty of leases come up. You can also look on the Gilis - plenty there too and not a bad lifestyle except for the malaria.

The type of information you want is very hard to get on an internet forum. It's a bit like gold really - and you have to do the work to get it. You need to seek out others who are doing what you want to do, in person - and then get friendly enough with them that they will be willing to spill the beans to someone who wants to go into competition with them.

Go to Bali. Network, get introductions, hang out in expat bars, and good luck.