OPERATORS REPORT
Q4 2023
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EXECUTIVE SUMMARY
Welcome to REID's Q4 Operators Report! The following is an overview of the properties analyzed by REID in Q4 of 2023. REID’s carefully crafted and curated selection of data from key regions and neighborhoods will empower readers to become informed operators in Bali’s real estate market.
As a point of reference, key changes from REID’s Q3 Operators Report to the Q4 report include:
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The rental supply increased from 54,037 to 60,523.
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The average daily rental rate decreased from $191 to $181.
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The market occupancy rate decreased from 64% to 52.7%.
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The proportional percentage of arrivals from different countries. remains unchanged from the previous quarter.
TOTAL RENTAL MARKET SUPPLY
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The total number of properties supplied to the market in Q4 remained above 55,000.
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The number of rental properties on the market in Q3 sat between 50,000 to 55,000. As expected, Q4 figures continued an upward trend.
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December experienced the largest supply in the market at 62,877 properties, with an increase from October (by 13.5%) and November (by 7.8%).
RENTAL MARKET SUPPLY BY SIZE
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One bedroom properties were the primary supply at 31,153 properties. Supply decreased as the number of bedrooms increased from 2- to 5-bedrooms.
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Six+ bedrooms did not follow a downward trend, but rather spiked higher than 5-bedroom properties. Similar to Q3, this is indicative of the market’s interpretation of demand.
1 BEDROOM SUPPLY GROWTH
RENTAL SUPPLY
BY REGION
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North Badung had the largest market share of rental supply at 36.8%, with Central and South Badung following behind at 18.4% and 15.1% respectively
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Interestingly, Mengwi remained at 2% of the rental market supply and is still considered an emerging region, including neighborhoods like Seseh and Cemagi. REID expects this region to grow in supply as the region becomes more developed.
RENTAL SUPPLY
BY REGION & SIZE
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Overwhelmingly, 1-bedroom properties throughout every region were the primary asset on the rental market, but in particular North Badung, with 10,552 properties in Q4.
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Rental supply in Tabanan increased the most from Q3 to Q4 by 24.6%, followed next by Mengwi which saw an increase of 20.7%.
AVERAGE DAILY RATE
AVERAGE DAILY RATE
BY REGION
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Mengwi, highlighted by REID as an emerging region, saw the highest average daily rate (ADR) at $244, 34.8% greater than the market median
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Overall the ADR from Q3 to Q4 decreased for each region. REID attributes this to tourist seasonality and decreased demand driven by the boost in rental property supply.
AVERAGE DAILY RATE
BY REGION & SIZE
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One-bedroom properties for most regions sat below the market median due to large supply.
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Larger variances in ADR occured in the 5- & 6-bedroom groups. For example, 6-bedroom properties in Tabanan has an ADR of $1,500, 121.2% above the market median. This trend is particularly relevant where supply is lower and regions are emerging.
ABOVE MARKET MEDIAN
BELOW MARKET MEDIAN
RENTAL OCCUPANCY
OCCUPANCY RATE
BY REGION
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Occupancy rates between all regions were stable. 62.5% of the market remained over 50% occupancy, with a market average of 52.7%.
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North Badung had an occupancy rate of 57.4%, the highest above the market average rate, by 4.7%.
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From Q3 to Q4, all regions experienced a decrease in occupancy rates, with particularly large variances in South Badung, decreasing by 20.7%, and Gianyar, at 17.1%.
RENTAL REVENUE
MONTHLY RENTAL REVENUE BY REGION
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In line with occupancy rates and ADR, the monthly rental revenue decreased overall.
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Despite Gianyar's above market occupancy rate of 53%, its monthly rental revenue was below the market average by 25%.
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From Q3, Central Badung decreased in monthly rental revenue by $1,417 (a reduction of 37.3%), highlighting fluctuations associated with demand.
MONTHLY RENTAL REVENUE BY SIZE
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Two-bedroom units on average earned more than double in rental revenue than 1-bedroom properties.
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As seen in REID’s Q3 Builders Report, 2-bedroom median listing price was only 42% higher than 1-bedroom median listing price, however 2-bedroom properties outperform 1-bedrooms by over double in monthly revenue.
MONTHLY RENTAL REVENUE BY REGION & SIZE
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In Q3, South Badung outperformed the market median revenue amount for each bedroom size. In Q4, however, this was no longer the case.
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Six-bedroom properties demonstrated the largest variances and largest rental revenue values overall. For example, Tabanan showcased $13,050, 32.4% over the market average for 6-bedroom properties.
ABOVE MARKET MEDIAN
BELOW MARKET MEDIAN
TOURIST ARRIVALS
FOREIGN ARRIVALS
BY NATIONALITY
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Europe contributed a diverse mix of countries to tourist numbers with 3% of visitors from Russia, 5% from the United Kingdom, and 10% from other areas of Europe.
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India contributed 8% of Asia’s tourism to Bali and is the largest group of visitors from this region
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From Q3, there has been zero change to the makeup of tourist nationality, conveying the overall consistency of tourism sources to Bali in 2023
SEASONALITY
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Q4 experienced the highest monthly tourism inflow with December welcoming over 1.6 million visitors.
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Over 70% of visitors in December were Indonesian, representing the most popular month for Domestic tourists.
Contrastingly, December was only the 4th most popular month for Foreign arrivals demonstrating a distinct variance between domestic and foreign travel trends.
THANKS FOR READING!
Looking for a specific neighborhood or data point? Contact us to learn more.
In summary, Q4 of 2023 showcased consistent trends with previous quarters, and overall indicated further expressions of stability and confidence in Bali’s real estate economy in relation to tourism. The market experienced a decrease in average daily rental rates, occupancy rates, and revenue due to seasonality and the increase of supply. Tourism numbers and international arrivals remained consistent, with India emerging as a key tourist demographic.
As the Q4 Operators Report is a high level snapshot and summary of the market, REID also offers more precise and tailored solutions. Contact us to see how we can meet your real estate needs.
See our other reports below: