Calculating Net ROI on a Bali Investment Villa

Net ROI on a Bali investment villa typically lands between 4 and 7 percent on purchase price once management fees, rental income tax, and holding costs are subtracted from the gross figure. Established Bali agencies report gross short-term rental yields of 10 to 15 percent in prime areas such as Canggu and Uluwatu, a range consistent with the record short-term rental performance documented in Colliers' Q4 2024 Bali Hotel report. The gap between gross and net is driven by three predictable cost lines.

First, villa management and booking platform fees: full-service operators charge 20 to 25 percent of gross revenue as a base fee, with Airbnb and Booking.com adding 15 to 17 percent on top; the combined channel cost before tax or operating expenses typically runs 30 to 35 percent of gross, per OwnPropertyAbroad. Second, rental income tax: a PT PMA holding the villa pays PPh Final at 10 percent of gross rental revenue under Government Regulation 34 of 2017, a final tax on the gross amount with no further deductions permitted. Third, annual holding costs covering PBB land tax, PT PMA compliance, PLN electricity, insurance, pool maintenance, and a capital expenditure reserve run USD 12,000 to 24,000 per year for a mid-range three-bedroom pool villa, as detailed in our annual costs guide.

A worked example puts the waterfall into numbers. A USD 300,000 off-plan villa generating USD 42,000 in gross annual rental revenue (a 14 percent gross yield) sees combined management and OTA fees of 30 percent consume USD 12,600, PPh Final at 10 percent of gross consume USD 4,200, and USD 13,000 in annual holding costs, leaving a net of USD 12,200 to the PT PMA before any dividend. That is a net yield of just over 4 percent on the purchase price. Drive gross revenue to USD 50,000 through stronger occupancy and the net rises to roughly USD 17,000, a net yield of about 5.7 percent. These are illustrative calculations, not projections. This is general information and not financial or legal advice; confirm your cost profile and tax position with a licensed Indonesian tax adviser before committing.

The variable that most shifts the outcome is gross revenue. Holding costs are largely fixed, so occupancy rate and nightly rate move the net yield far more than small differences in management fee percentages. For the full ownership and tax picture, see our foreign buyers guide and rental income tax guide.