Gross returns sound impressive, but as an investor you want to know what remains at the bottom line. In this article we work through a realistic example, with all the costs that play a role in Bali.
Start with the gross return
A well-positioned 2-bedroom villa in Canggu or Uluwatu typically generates between 30,000 and 50,000 dollars of gross rental income per year in 2025. At an occupancy rate of 80 to 95 percent, that is a solid starting point. For the projects we develop ourselves we apply a gross return range of 15 to 20 percent.
What comes off
From the gross return come property management (10 to 25 percent), platform commissions for OTA channels such as Airbnb or Booking (15 to 20 percent), maintenance, utilities, insurance, the local banjar contribution and Indonesian withholding tax. That withholding tax is a final levy of typically around 10 percent on rental income from property. Together the cost side comes to 35 to 50 percent of gross.
The net outcome
A villa with 20 percent gross therefore typically yields 10 to 14 percent net. In a prime location with good occupancy, the payback period on a net basis sits between 5 and 8 years, against usually more than 20 years for a rented home in the Netherlands.
How we make this transparent
We record the expected position within our 15 to 20 percent range in writing per project before you commit. We then report each quarter on a net basis what actually remains. No surprises, but verifiable figures. For your own tax situation, always consult an adviser.
