The increasing number of villas for sale in Bali has become a hot topic as more foreign investors flood the island’s property market. The recent controversy surrounding Australian influencer Julian Petroulas has brought attention to the issue of foreign land ownership in Bali. Petroulas boasted about purchasing 1.1 hectares of land to build a nightclub, fitness center, and hotel. Still, Indonesian immigration authorities later revealed that he did not legally own any property. As a result, he was deported and banned from re-entering Indonesia.
This case highlights a growing concern: while villas for sale in Bali are widely advertised, many transactions involve legal loopholes. Indonesian law prohibits foreigners from owning land, but many bypass regulations using long-term leases or nominee agreements, which are legally questionable.
The Foreign Takeover of Bali’s Property Market
Bali has seen a surge in foreign-controlled properties, particularly luxury villas, despite restrictions. Many foreigners establish villa rental businesses without obtaining the necessary licenses, often leasing out properties online. According to the Indonesian Nominee Crisis Task Force (K3NI), by 2020, over 50,000 foreigners controlled illegal land and properties worth IDR 109.2 trillion (~USD 7 billion). With the booming real estate market, the number of foreign-owned villas for sale in Bali has likely increased even further.
A common tactic foreigners use is purchasing property through local Indonesian nominees, which is not recognized under Indonesian law. The Indonesian Supreme Court has ruled against nominee agreements. Yet, many luxury villas in Bali remain owned and operated through such arrangements.
The Russian Influence and Controversial “Russian Village”
One of the most debated foreign settlements in Bali was the “Russian Village”, which was shut down by authorities in November 2024. Many Russian nationals had moved to Bali, escaping the Russia-Ukraine war. They had taken control of land, cafes, and hotels, with some reports of land grabbing and intimidation of locals.
By March 2023, the Ministry of Law and Human Rights recorded 19,530 Russian nationals living in Bali. This foreign dominance led to controversies, including the unofficial renaming of a Denpasar area to “New Moscow”, which sparked a public backlash.
Skyrocketing Property Prices: Locals Struggling to Compete
The rise in villa for sales in Bali has driven property prices up, making it hard for local Balinese to afford land in their own country.
According to Realinfo, Bali’s property prices have increased by 7% annually. In Batubulan, Gianyar, land prices now reach IDR 300 million (~USD 19,000) per 100 square meters, far beyond the reach of most locals, who earn only IDR 3-5 million (~USD 190-320) per month. In Sanur, land prices have jumped from IDR 100 million (~USD 6,400) to IDR 1 billion (~USD 64,000) per 100 square meters.
A report from Rumah123, a property marketplace, showed that Denpasar’s property prices rose by 15.1% in September 2024, outpacing inflation by 11.6%. This sharp increase is making it increasingly difficult for Balinese families to buy homes as the market becomes dominated by wealthy foreigners.
Bali’s Immigration Boom: More Foreigners Settling Permanently
Tourism has long been a significant industry in Bali. Still, the post-pandemic trend of long-term foreign residency is creating new challenges. Many foreigners, particularly digital nomads, have moved to Bali permanently, attracted by the lower cost of living.
Between January and August 2024, Ngurah Rai Airport recorded a 22.6% increase in foreign arrivals, with 4.46 million visitors in 2023. Many foreigners have shifted from short-term tourists to long-term residents, driving up property prices and reducing housing availability for locals.
In 2024, the Directorate General of Immigration issued:
- 4.6 million Visas on Arrival (VoA)
- 62,630 Limited Stay Visas
- 463,821 Visit Visas
- 471 Golden Visas
The Rise of Golden Visas and Foreign Investment in Bali
Indonesia introduced its Golden Visa program in July 2024 to encourage foreign investment, offering easier long-term residency for wealthy foreigners. By December 2024, Golden Visa investments reached IDR 9 trillion (~USD 600 million).
Golden Visa categories include:
- Individual and corporate investors
- Former Indonesian citizens and their descendants
- Second-home visa holders
- Global talents and world figures
While the Golden Visa attracts foreign investors, it also raises concerns about the increasing number of foreign-owned luxury villas and the impact on local housing affordability.
The Future of Bali’s Local Communities
The surge in villa sales in Bali reflects a growing foreign influence reshaping the island’s economy. While tourism and foreign investments bring financial benefits, the rapid increase in foreign-owned properties pushes local Balinese residents out of the market.
Bali risks becoming a foreign-dominated real estate hub where locals struggle to compete without enforcing stricter regulations. The Indonesian government must balance economic growth and protect local land rights, ensuring that Bali remains accessible for its own people, not just wealthy expatriates and investors.