The asset you sell is not the asset you bought
Most foreign buyers in Bali hold either a lease or a corporate structure; neither is freehold in the buyer’s own name. A lease runs for a fixed term and consumes itself: a buyer signing a 25-year lease at 28 holds a lease that expires when they are 53, and every year of income is also a year of term gone. As the term shortens the asset’s value falls, and no rental yield compensates for a lease that approaches zero at expiry.
Phuket’s position is different in kind. A foreigner may own a condominium unit freehold, on a Chanote title in their own name, within the 49% of a building’s total floor area reserved for foreign owners. It is genuine, inheritable, sellable ownership with no term attached. Villas here are leases too, a 30-year term registered at the Land Department, with renewals that are contractual promises rather than registered rights, so the Phuket comparison that holds is the condominium one.
That is the whole reason Bali’s percentages look higher. Divide the same rent by a smaller price for a decaying asset and the percentage rises; it is arithmetic on the denominator, not evidence of a better investment.
Why the headline yields differ
Bali’s advertised yields rest on three things: low capital values relative to rents, villas that owners let themselves rather than through a management company, and rentals priced in dollars against costs in rupiah. Each of those is real and each carries its own counterpart, a decaying asset, an operation you run yourself, and currency exposure in both directions.
Phuket’s yields come with the opposite trade: a durable asset, an established management market so a remote owner can appoint a manager and receive statements, and income earned in baht that has moved far less against the dollar than the rupiah has over the same years. Guarantee programmes exist in Phuket resort stock; on any of them, establish which company is liable and what the completed buildings earn once the term ends.
Neither figure should be taken from a percentage on a slide. Ask for twelve months of operating statements on a comparable property in each market, with the empty months included.
Tourist volume and demand foundation
The two islands’ visitor totals are quoted very differently from one source to the next and this page does not lean on a number. The structural point is the airport: Phuket’s public international airport handled more than 17 million passengers in 2024 against a design capacity of 12.5 million and is being expanded to 30 million by 2028, which supports a guest pool drawn from many source markets. Bali’s demand is real and concentrated in a few districts where new supply has pressed on rates.
Legal security
Thailand’s condominium framework has been in place since the Condominium Act B.E. 2522 of 1979, foreign freehold units are registered at the Land Department, and the registered-lease route for villas is used by tens of thousands of foreign owners. Bali’s rules for foreigners are more restrictive and more dependent on structure, and regional regulation of villa rentals and foreign-owned businesses has moved more than once in recent years. This site works in Phuket and not in Bali: treat the Thai side as ours and the Bali side as something to verify with an Indonesian lawyer before any deposit.
Currency
The Thai baht has moved within a comparatively narrow range against the dollar over the past several years, and much Phuket resort stock is quoted in dollars at purchase, although the income leg converts. The rupiah has depreciated materially against the dollar over the past decade, and a Bali owner earning dollar rents against rupiah costs and rupiah land values is carrying that exposure in both directions.
What to compare, in order
- What you would hold in each market, and for how long.
- What that holding will be worth to the next buyer at the end of your intended hold.
- Net income, from operator statements, after management, turnover and vacancy.
- Entry and exit costs, in Thailand a 2% transfer fee on appraised value, split by agreement, plus seller-side lines; establish the Bali equivalents locally.
Only then the yield. The fuller comparison is on Phuket vs Bali property investment.
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Olga
Head of Rentals, MORE Group
Runs the rental side at MORE Group: occupancy and rate data from managed Phuket units, management-company selection, and what an owner actually nets after costs.
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