Luxury property developers are increasingly heading to Indonesia and are pushing up home prices at a faster rate than just about anywhere else in the world.
The Indonesian island of 4 million people is offering lucrative opportunities as the economy booms.
International estate agency Knight Frank has put the island at the top of the luxury homes league with demand coming mainly from domestic buyers, but also supported by investors flocking from the UK, France and Australia.
The Asia Pacific region is now home to more millionaires than anywhere else in the world, and many Asian expats from Hong Kong and Singapore are joining the Bali investment rush.
However, the agency says that Bali is not the only place in Indonesia to witness high growth. Pointing to the Indonesian capital Jakarta as another example, as the price of luxury homes there has rocketed by 38% since 2011.
Bali good show
Prices in Bali have risen by 20% in the same period, putting the island in joint second place with Dubai.
Monaco still lays claim to be the world’s most expensive location for buying a home, but if Indonesia’s prices to keep on rising as they are there then that country may take the top spot.
Indonesia’s booming economy has resulted in the net worth of individuals rising by 7% year-on-year and the country looks set to become the world’s seventh biggest economy by 2030.
The findings by Knight Frank are backed up by Bali-based property firm Elite Havens which says the investment in the country’s property market is offering better value than a bank savings account would.
They say that the island’s property market is been dominated by wealthy investors from Surabaya and Jakarta who were snapping up vacant building land but they are also buying hotels and private villas too.
In a report published by the firm, they say that Bali’s popularity as a tourist destination, coupled with a healthy economy have helped turn the property market there into an international safe haven for investors.
Land prices triple
The report says: “There’s been a dramatic increase in Seminyak, where land prices have almost tripled in the last two years because demand is so high and supply so low.”
Indeed, there is so much development in progress that the island is gradually changing and the popular expat town of Seminyak has recently lost its last rice paddy field.
Buyers have been investing heavily in beachfront properties and now the land around beaches is beginning to increase in price and investors are moving further north and inland away from the established tourist destinations.
Though Bali is seeing some impressive luxury hotels and villas being constructed, one of the downsides is that the traffic is now choking the roads so what should be relatively short journeys become arduous long ones.
