Limited Land Drives Investors Northward
Limited land availability in the southernmost part of Bali, especially Badung and Denpasar, has driven investors northward, a property analyst said.
During the last couple of years, investors have been targeting the coastline around Tanah Lot, in Tabanan, heading to the north of the regency due to the limited land availability in the south.
“Tabanan’s western coast offers pristine black sandy beaches that have the potential to be world-class surfing spots and is predicted to have a bright prospect as an alternative location for property developments,” Matthew Georgeson from property consulting company Elite Haven-Knight Frank stated in a recent piece of research.
The research stated that this bright outlook was supported by future infrastructure development, including the anticipated toll road connecting Kuta in Badung regency and Seririt in the island’s northern regency, Buleleng, that has been planned by the government.
The toll road will be constructed to pass several famous tourist attractions, such as Tanah Lot temple and Soka Beach in Tabanan. The construction of the 73-kilometer Kuta-Seririt toll road is estimated to cost more than Rp 8 trillion (US$832 million).
According to research and field observation conducted by Elite Haven-Knight Frank, land prices in Bali are expected to continue increasing to around 28 percent throughout the rest of this year, having recorded growth of 25 percent during the first half of this year.
Last year, the growth in land prices in various strategic areas in Bali reached 43 percent, the highest growth ever during the last 10 years when average growth had been around 8 to 16 percent.
In favored areas like Seminyak, Legian, Petitenget and Batubelig, the average price of land for non-coastal locations recorded growth of 33 to 36 percent during the first half of this year.
In Seminyak and Petitenget, the price has hovered above Rp 15 million per square meter, while in Batubelig the price has exceeded Rp 10 million per square meter.
“Plots of land in these areas are limited. Even if there are available plots, they are offered for lease, not for sale, because Balinese people now prefer to lease their land for the long term rather than selling it,” said Gde Semadi Putra, member of the Property Committee of the Indonesian Chamber of Commerce in Bali (Kadin Bali).
Land prices around the Seminyak to Berawa area have increased up to 45 percent in non-coastal areas. “In coastal areas, the price has doubled, driven by surging demand,” Georgeson said.
Land prices in the coastal areas around Canggu recorded 33 percent growth, while those in Seseh, Cemagi and Nyanyi hovered around 18 to 25 percent during the first half of this year.
Elite Haven-Knight Frank also stated that another area being eyed by investors was south of Ngurah Rai International Airport, where there are exclusive plots of land on the white sandy coastline.
Along the southern coastline, especially cliff tops with a sea view around Jimbaran and its immediate area, prices have grown by 33 percent. Meanwhile, in Nusa Dua — where star-rated hotels dominate, the price growth reached 50 percent during the first half of this year.
Other popular areas, like Sanur and Ubud, have also shown a significant increase in land prices.
“The fast growth in the middle class in Bali and the increase in tourist arrivals has driven the market resulting in a brighter outlook. The growth of land prices in Bali, as well as neighboring areas like Nusa Lembongan and Lombok, is predicted to continue until the end of this year, and is expected to break new records,” Georgeson said.Filed under: Headlines