Built vs Off-Plan Villas Investment in Bali, Which One is Better?

Buying property in Bali often comes down to this question: should you buy a finished villa, or commit to an off-plan project that’s still being built?

Yes, we get this question quite often from our clients.

A new villa is already completed or close to completion. You can start using or renting it almost immediately.

An off-plan project, on the other hand, is purchased during design or construction phase. Delivery usually takes 12-24 months, sometimes longer. People often prefer this option because it comes at a lower price.

Honestly, both options can work very well, but they attract different types of investors, budgets, and risk tolerance.

The mistake many buyers make is choosing based on price alone, without thinking about timing, cash flow, and execution risk.

This article walks through both options in detail so you can decide correctly.

Invest in New Villas: Pros and Cons

New villas are popular with investors who value certainty. They come in two main ownership options: leasehold and freehold.

Because the property already exists, there are fewer unknowns. You know exactly what you’re buying, how it looks, how it feels, and how it compares to neighboring villas.

From an investment standpoint, the biggest advantage is timing. Rental income can start immediately, which matters in Bali’s seasonal market.

For buyers who want predictable cash flow, minimal involvement, and easier resale, new villas tend to feel more comfortable.

Choose to invest in a newly built villa if:

• You want immediate income
• You prefer lower risk and minimal involvement
• You plan to resell within 3–5 years
• You want predictable cash flow

✅ Pros:

• Immediate rental income: No waiting period. You can start using the villa and get profit immediately.
• Easier resale & financing: Completed assets are easier to sell and value.
• Clear ROI calculation: Rental history or comparable data already exists.

❌ Cons:

• Higher purchase price: Developer margin and market demand are already priced in, making the total price always higher.
• Limited customization: Layout and finishes are usually fixed. If you want to personalize the villa, you will have to spend additional money, time, and effort.
• Yield compression in established hotspots: High buyer demand has already driven prices up. While rental income remains strong, purchase prices rise faster than rents, which can result in slightly lower yields.

Invest in Off-Plan Projects: Pros and Cons

Off-plan projects attract investors who are willing to trade time and risk for better numbers.

Buying early usually means paying 10–25% less than the finished market value. If the project is executed well, that discount turns into equity before the villa is even rented.

Another advantage is flexibility. Off-plan buyers often have a say in layout, finishes, and features.
This can make your property stand out more and easier to market.

Choose to invest in an off-plan villa if:

• You can be patient while waiting for delivery
• You want a fully customized villa or flexibility to personalize it
• You aim for higher long-term ROI
• You want a lower buying price (which can lead to higher profit)

✅ Pros:

• Lower entry price: Typically 10–25% cheaper than finished villas.
• Higher capital appreciation: Value increases as construction progresses.
• Design flexibility: Layout, materials, and features can often be adjusted.
• Staggered payments: Payments tied to milestones improve cash flow management.

❌ Cons:

• Construction & delay risk: Weather, labor shortages, or mismanagement can slow delivery.
• Delayed income: No rental revenue until completion.
• Developer risk: Your investment depends heavily on who builds it. That's why it's important to do thorough research before choosing a real estate developer.
• Exit complexity: Selling before completion is sometimes harder.

Read More: Benefits Of Buying Off-Plan Property in Bali

ROI Comparison: Built vs Off-Plan Villa Bali

Let’s compare two realistic scenarios in established rental areas like Canggu.

A completed 2-bedroom villa purchased at around USD $220K or IDR 3.6B might generate roughly USD $30K or IDR 495M in gross annual rental income.

After management fees, maintenance, staff, tax, and utilities—typically around 30%—net income lands near USD $21K or IDR 346M per year. That results in a net yield of approximately 9.5%.

An off-plan villa in a similar location might be purchased at USD $140K or IDR 2B, with an 18-month construction timeline.

By completion, market value could reasonably reach USD $220K, creating around $80K USD in unrealized capital gain.

Once operational, rental performance may match the new villa, producing the same USD $21K or IDR 346M net income.

On the original invested capital, that pushes the effective net yield to approximately 15%.

Category	New Villa (Completed)	Off-Plan Villa
Purchase Price	USD 220K / IDR 3.6B	USD 140K / IDR 2.0B
Construction Time	Ready	~18 months
Market Value at Completion	USD 220K	USD 220K
Unrealized Capital Gain	—	USD 80K
Gross Annual Income	USD 30K / IDR 495M	USD 30K / IDR 495M
Net Annual Income	USD 21K / IDR 346M	USD 21K / IDR 346M
Net Yield	~9.5%	~15%
Income Start	Immediate	After completion
Risk Level	Lower	Medium–Higher
Investor Profile	Cash-flow focused	Growth-focused

So, we think that neither option is “better” in isolation. One prioritizes speed and certainty, the other maximizes leverage and long-term return.

Off-Plan Risk: What Actually Needs to Be Checked

Off-plan risk in Bali is rarely about the concept itself; it’s more about execution.

Before committing to this type of investment, buyers should be able to:

• Clearly verify that land zoning allows residential and rental use (you can check it on the OSS Indonesia website: https://oss.go.id/)
• Confirm that land titles are clean and uncontested
• Fully understand the ownership structure they are buying into

Equally important is the developer’s track record. Past projects should be visitable, not just shown in photos.

Construction timelines must be realistic, with clear milestones and payment stages. Vague delivery promises or unclear specifications should be treated as red flags.

Rental projections deserve careful scrutiny as well. Conservative occupancy assumptions—typically around 60–75% annually—are far more realistic.

Read More: ROI on Bali Villa Investment - Simulator to Calculate Bali Villa ROI

Conclusion

Both newly built villas and off-plan projects can be solid investments in Bali when chosen for the right reasons.

The key is not choosing based on price alone, but aligning your investment with your timeline, risk tolerance, and return expectations.

With proper research, realistic assumptions, and the right strategy, either option can work well in Bali’s property market.

Need further help? Our expert agents are here to answer all your questions and share relevant market insights. Book a free, no-obligation consultation anytime.

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