Bali vs Canary Islands Property for Foreign Investors

The Canary Islands let any foreign buyer, including US and UAE citizens, own property outright in their own name under full Spanish title. In Bali, foreigners cannot hold Sertifikat Hak Milik (freehold) directly and must use a leasehold of 25 to 30 years or a PT PMA company structure. That ownership difference is the sharpest line between the two markets.

Entry prices reflect two very different cost tiers. Residential property on Tenerife averaged around EUR 3,845 per sqm in mid-2026, with Gran Canaria at roughly EUR 2,970 per sqm. Land in Bali's emerging Tabanan corridor sits below USD 250 per sqm, while prime Canggu runs USD 530 to 1,560 per sqm. A comparable villa build in Tabanan can come in well under a Canary Islands equivalent, which draws investors willing to navigate the leasehold or PT PMA route.

Rental yields tell a similar story. Long-term lets in the Canary Islands typically produce 4 to 7% gross yield. Short-term vacation rentals can reach 7% or higher, though Canary Law 6/2025 now requires a 60% community building vote before a tourist rental license is granted, and several municipalities have already suspended new licenses. Bali villas with professional management in well-positioned areas report gross yields of 8 to 15%, supported by a tourism market that recorded nearly 7 million foreign arrivals in 2025.

Tax treatment favors Bali for US and UAE buyers. Non-EU, non-EEA owners in the Canary Islands pay a flat 24% Spanish non-resident income tax on rental earnings. In Bali, the equivalent rate is 10% final withholding. The Canary Islands purchase transfer tax is 6.5% ITP on resale properties; Bali's buyer-side BPHTB is 5%. Capital gains on a Canary Islands sale are taxed at 19% for non-residents under Spanish IRNR rules.

The Canary Islands offer freehold security, Euro-denominated stability, and EU legal protections backed by Spanish courts. Bali offers higher potential yields, a lower entry price in emerging areas like Tabanan, and exposure to one of Asia's fastest-growing tourism markets. This is not financial advice; yield and return figures are indicative ranges that depend on location, management quality, and market conditions.