How will the property market go in 2024?

The year has started and we still hear a few different approaches on how to look at the property market. Some real estate agents try to push other destinations, we also have promoted other areas such as Sumba. But how is this market going now?

After reviewing the number of 2023, the occupancy rate of 2023 and beginning of 2024 is still under the occupancy rate of 2022. The value in USD is slightly higher. Two main factors:

  • The prices are slightly higher as business owner has increased their price compared to 2022.
  • The number of entry in Bali has increased

However, the revenue at the beginning of 2024 seems to follow the same as 2022. It seems that the number of entries did not follow the property investment done the last few months. The average of the occupancy rate is stabilising at 59%.

Bali seems to have reached a point in July August 2023. The question is now to know if the person who has invested in 2023 and is currently building will be covered in 2024.

bali occupancy rate AirDNA
Occupancy rate in Bali in 2023 on Airbnb (Source AirDNA)
Average revenue on Airbnb the last 2 years (Source AirDNA)
Average revenue on Airbnb the last 2 years (Source AirDNA)

Lombok an alternative?

While some are trying to place Lombok on the master plan, we can notice that the occupancy rate was similar to Bali but with a very low occupancy on average around 30%.  Lombok seems not for now to be the expected market that some promoters try to promise. However for investors with a premium location and a good strategy the place can be interesting to look at.

The election in a few months will determine the future of the next few years. While the country is taking different direction, the social factors have a strong influence on how and where people want to spend their money and vacation.

Occupancy Rate in Lombok (Source AirDNA)

Is Thailand better?

By continuing our analysis we started to take a look at the numbers in Phuket, Thailand. Phuket seems to have a higher occupancy rate at its peak but being more affected by the variability of the seasons. As Phuket had a lot of construction the last few month and its the occupancy rate seems also affected by a number of construction increasing faster than the demand.

Phuket occupancy rate (Source AirDNA)

Where to invest?

Bali and Phuket or Lombok, will see in the next few months a lot of new construction finalized following the purchase or lease of the last few months. The question is to now identify if the demand will follow or not.

In a long time there is no doubt that this demand will follow. Spain had this issue in the past and Asia has a strong domestic market to come. However, the incertitude is never good for an investor. Politics have to continue to improve infrastructure and send good signals to travelers willing to invest and occupy those properties.

A few weeks back, I remember having a discussion about investing in Bali and France. An interesting fact is that Paris has a higher occupancy rate than Bali despite what we could expect. With 75% compared to 59% in Bali, Paris seems a place where stability of the tourism industry is for example guaranteeing a certain level of revenue to the investor.

Indonesia has a strong potential. Location of the investment is key. We do trust that it is the right moment to invest but knowing how to do it is the key

  • Location
  • Durability of the investment
  • Property matching with the target market of Bali or the rest of Indonesia
  • Competition analysis
  • Tax analysis and planning
  • Right financing

Contact us if you want to know more and get more details about each sub district and where to invest.