Tried And True Best Practices For Real Estate Investors In Bali
Bali Property Report
Property Investment Tips & Strategies – Part Two
Part One of this 2-part article on Property Investment Tips & Strategies was first published here on Tuesday August 18 and can be found in the link below.
Now that you’ve completed those four important real estate investor tips, it’s time to take action. Fortunately, taking action is as easy as following these four steps:
- Get your financing organized, be it cash or mortgage
- Search available properties
- Select an agent who understands your needs; if you have found properties that appeal to you on another website, appoint your primary agent as your buyer’s agent
- Establish an exit strategy
Your agent will likely propose a strategy session that is catered to your unique needs. In fact, during this strategy session you can even review all the insights you’ve gathered through this entire process.When it comes to real estate investing, the most successful investors surround themselves with a trusted team of advisors and industry professionals who can help achieve their unique objectives and goals.
Mortgages are available to any qualified investor who is holding an Indonesian Identity card or to a foreigner who is holding a residential visa, KITAS or KITAP. However, for the foreign investor, interest rates have been historically prohibitive, so it is best to secure leveraged financing at home. For the Indonesian market, like anything else, shopping around for the best deal will save you good money in the long run.2. Should I hold the asset in my personal name or set up a company in Bali to hold it?
From your investment strategy session, you would have learned of the benefits of both. For commercial purposes, the company route is surely the way to go. For residential purposes, the exit strategy timeline will dictate the sensibilities of either choice.
3. Can you talk about self-directed retirement funds like Superannuation, 401K or IRAs? What type of real estate investment meets the requirements of these funds?
This is a great question for your accountant! Each type of fund has different rules regarding real estate investments and taxes. For example, Roth vs Traditional IRAs have different tax rules and regulations regarding real estate investments. From Australia, the SMSF overlords have fairly strict – but manageable – requirements from the flow of the money upon the initial sale, over the course of the investment, and of course upon selling the asset as well.
4. What types of villas are returning the highest ROI’s?
We have a great range of resources that can provide insights into the best value propositions for real estate investments. Generally speaking, provided that the villa meets certain quality standards with respect to location, construction, staffing and marketing, pure investment villas that sell in the USD250,000 – 350,000 range have historically returned high ROIs. As we slide up the scale into the $500k range and up, we have seen that increased personal use will decrease the ROI. However, how do you place a value on a well-spent month in Bali? Not in terms of dollars, but in terms of lifestyle investment for you and your family.
This is why the strategy session is so important; it allows both the investor and the agent to focus exclusively on a tight range of goals that stand a greater chance of being realized when they’ve been closely scrutinized and adjusted if need be.
Real estate investing represents a fantastic opportunity to explore new financial avenues, diversify your portfolio, and plan ahead for retirement (or other financial goals). By following the aforementioned real estate investment tips, you can start on the road to real estate investment success.
To learn more about how to invest in real estate, set up a strategy session with us (Patrick on Whatsapp/handphone +62 817 973 3031; [email protected]) to discuss concerns, answer questions, and take the first steps towards becoming a savvy real estate investor.
Last Weeks Properties of the Week
To schedule an inspection of any of our fine properties or to have a phone call to discuss your Bali real estate strategy, please reach out to Patrick on +62 817 973 3031/[email protected]