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EPISODE 8:
The 3 Golden Rules

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Pioneer Investing: The 3 Golden Rules

Are you ready to uncover the 3 golden rules of pioneer property investing in Bali?

Welcome to another revealing episode of the Bali Business Club Podcast! Your hosts, Gawain Blizzard and Omri Ben Canaan, take you on a deep dive into the three critical factors behind what is driving the westward growth progression in Bali’s real estate market.

Whether you’re an investor, property enthusiast, or someone just looking to understand Bali’s shifting landscape, this episode is packed with valuable insights to help you stay ahead of the trend!

Why Bali’s Westward Growth Matters in 2024

Bali has long been a destination for property investment with pristine surf spots, beautiful landscapes, booming tourism and robust investment opportunities. Areas like Kedungu, Nyani and Sesseh are seeing significant growth, understanding why and how this trend is occurring is a must know for investors looking to pioneer Bali’s real estate frontier.

This episode uncovers the forces behind this transformation and helps you leverage these opportunities to build a profitable portfolio.

What You Will Learn

In today’s episode, we’ll explore:

– Key Growth Drivers: Understand the 3 main reasons behind Bali’s westward expansion and how it’s shaping the future of real estate on the island.
– Government Influence: Learn about government policies and their role in stimulating westward development.
– Investment Strategies: Discover where the smartest investments are being made and how to position yourself to benefit from this growth.
– Surf and Coconut trees: Why coconut trees and surf spots play a pivotal role in this development and how this pattern has created new investment opportunities.

Episode Highlights

00:00:00 – Intro: Growth Progression and Trend in Bali
00:00:34 – Omri’s Experience in Bali Property
00:01:08 – Identifying the Next Investment Hot Spot
00:01:52 – Three Key Reasons for Rapid Growth
00:02:37 – Reason 1: Government Policy
00:03:12 – Jokowi’s Tourism Strategy
00:04:18 – Impact of Increased Tourists
00:04:54 – Reason 2: Coconut Tree Law
00:06:07 – Development Limitations in Bali
00:08:07 – Coastal Growth Patterns
00:08:46 – How to Spot the Next Hotspot
00:09:21 – Reason 3: Surf Spots Drive Growth
00:10:37 – Kedungu’s Development Potential
00:11:52 – Cemagi, Seseh, and Nyanyi Outlook
00:12:28 – Kedungu’s Surf Culture Appeal
00:13:08 – Pererenan’s Growing Popularity
00:14:11 – Sentiment and Moving to Less Crowded Areas
00:14:44 – Closing Remarks and Free Pizza Offer

The Importance of Understanding Bali’s Development Shift

Knowing where Bali’s property market is heading is crucial for investors who want to stay ahead of the curve. With prices rising in popular areas like Canggu, Seminyak, and Pererenan, smart investors are looking further westward. Learn why this shift is happening and how you can benefit from the coming wave of development in Kedungu, Yeh Gangga, and beyond.

Enhance Your Investment Journey

Our expert hosts share their deep knowledge of Bali’s evolving property market, giving you the tools and strategies needed to make informed decisions. From understanding the government’s role in real estate development to recognizing the importance of surf culture in community growth, this episode provides everything you need to know to stay ahead of Bali’s westward expansion.

Join Our Community

Don’t forget to like, comment, and subscribe for more valuable content! Your engagement helps us grow and fuels the conversation on Bali’s property market trends. Whether you’re a seasoned investor or just starting out, our episodes provide the insights you need to succeed.

How to Get Involved

– Explore More: Delve deeper into Bali’s investment options by visiting The Kedungu Fund.
– Direct Inquiries: For personalized assistance, reach out to us on WhatsApp at +62 0812 4616 2018.
– Stay Connected: Follow us on Instagram and LinkedIn for the latest updates, tips, and insights into Bali’s investment landscape.

Stay Tuned!

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Previous Episodes Worth Checking:
Notary Insights on Leasehold Extensions in Bali • Notary’s insights: Bali Real Estate E…
Why Leasehold Can Be a Smart Investment • Bali Leasehold vs. Freehold! The Ulti…

This episode will equip you with the knowledge and strategies to thrive in Bali’s real estate market. Tune in now and secure your place in this exciting real estate movement!

Summary

Omri Ben-Canaan discusses the factors driving investment opportunities in Bali, focusing on government policies, building regulations, and surf culture.

Highlights

  • 🌐 Government: The Indonesian government’s push to double tourism has led to increased investment opportunities.
  • 🏗️ Building Laws: The “coconut tree law” restricts building heights, encouraging horizontal development in Bali.
  • 🏄 Surf Culture: Proximity to surf spots significantly influences real estate development and investment potential.
  • 🚦 Population Growth: Rising tourist numbers necessitate more infrastructure and lodging options across Bali.
  • 🏝️ Coastal Development: Investment opportunities follow the coast, where most tourists want to be.
  • 💡 Market Trends: Areas experiencing congestion often lead residents to seek new opportunities in nearby locations.
  • 🍕 Audience Engagement: Listeners are encouraged to comment on the next investment area for a chance to win pizza.

Key Insights

  • 📈 Government Influence: The Indonesian government’s aggressive tourism policies have directly impacted real estate prices, making it a crucial factor for investors. The push for increased tourism infrastructure creates demand for new developments.
  • 🏢 Building Restrictions: The coconut tree law significantly limits vertical growth in Bali. This means that as tourism increases, developers must seek land for horizontal expansion, driving up prices in desirable locations.
  • 🌊 Surf Spot Importance: Historical trends show that real estate value often correlates with proximity to surf spots. As a result, areas near surf locations are likely to see quicker investment returns.
  • 🚶‍♂️ Density Indicators: The congestion in popular areas signals to investors where to look next. When locals express dissatisfaction with overcrowding, it often indicates a shift in investment to surrounding regions.
  • 🏖️ Coastal Appeal: The appeal of coastal living drives demand in Bali. Investors should focus on coastal developments to capitalize on growing tourist interest and the local lifestyle.
  • 🔄 Cycle of Development: As one area becomes overdeveloped, investors often look to the next region over, creating a cyclical pattern of investment that can be anticipated with market awareness.
  • 🍕 Community Engagement: Engaging the audience by offering incentives, like pizza giveaways, fosters community and encourages discussions about future investment trends.
  •  

Transcript:

00:00
Alrighty, so here we are again with Omri Ben-Canaan and today it’s a special podcast, a super short one. We get asked this question so much and it’s the scientific reasons behind why there is an area of progression on growth westward since back in the Kuta days, what, 20 years ago? More than 20, actually 40 year. 30 years ago, yeah? 40, 40, 40. 40 years. Even before my time. That’s a long time ago. That’s a long time ago, yeah. So we’re going to go into all the details, why this happens, the factors that are

00:34
involved in happening really. So yeah, Omri is the guy, he’s been here since about 30 years, so he knows the progression. Well, thank you very much. Thanks Gawain, hi everyone. So this is a podcast number seven, eight, I don’t know, seven and a half, something like that. So basically what we’re going to talk about today is a very short podcasts. We’re going to explain, and we’ve been over this time and again in the other podcasts, but this one is just specifically about that. We’re going to explain how to identify the next spot,

01:08
like what makes the next spot a good place to invest. So basically there are… Sorry, the timing. So it’s all about timing. It’s all about timing. When to enter the market, when it starts to kick off and then the underlying reasons why, because we get asked that question all the time. All the time, why Kedungu, or why you got to go, whatever. What’s next? Yeah. Okay, so basically there are three reasons, okay? This is Bali, remember? Yeah. Airport is here, you have Seminyak, Batu Belig. Berawa, Batu Bolong, Pererenan.

01:52
So now we are here. Seseh, Cemagi, Nyanyi Kedungu and North to Gilimanuk, okay? So there are three main reasons. So reason number one, reason number one is government, okay? Indonesian government has a very, very aggressive policy towards increasing the number of tourists in Indonesia in general and mechanically in Bali, yeah? So since Jokowi came into power in 2014, Jokowi, I remember, so the president, Indonesian president, Joko Widodo, the one that’s exiting now, one of his campaign promises was,

02:37
“I’m going to double the number of tourists in five years.” That’s what he said, yeah? Yeah. Up until Jokowi, it was, I mean, it was a progression, it was a massive progression, but it was very organic. It was complements to Instagram a lot. Social media, yeah. But it was less of a, I mean, there was, but not as much as now, less of a plan, yeah? So since Jokowi came into power, he said, “I’m going to double the number of tourists in five years.” And he did it, almost. COVID happened and I think it was

03:12
short of a few hundred thousand, yeah? But let’s say he did it, yeah? So basically, with government pushing and pushing for more tourists, developing infrastructure, putting, the budget of the Ministry of Tourism is massive, you know? It’s all Wonderful Indonesia campaign. Yeah, yeah, yeah, yeah. We did one in Baliprod. During COVID, remember, we did one on Lake Toba, I think it was a half million dollars to shoot a lake that no one goes to, you know? Okay. But that story aside, there’s a lot of

03:44
interest into developing the tourism. This tourism industry in Indonesia. Why? Because it’s very, very far behind other countries. It’s only I think half of the one in Singapore. Singapore which is like big like this, Indonesia is 5,000 kilometers long. It’s nowhere near a country like France where I’m from, which has like 100 million tourists per year. I forgot the exact number in Indonesia, so I don’t want to say wrong numbers, plus the change every year. But like I know in Bali this year is a million, which

04:18
has never happened before pre-COVID whether it was four or five million. Best tourist figures ever. Yeah, best and expect eight million next year and counting. So you have one factor why land price increases in South area. The policy, you know, the government policy to increase tourism. You got to put these people somewhere, you know? Like you have more people. Bali pre-COVID, five million people. This year is seven million people. Where do these people sleep? You know? That’s why you have more infrastructure, more, I

04:54
mean, more hotels, more villas, more whatever. You got to lodge all these new tourists. Too many people it’s not nothing. And that’s also… A lot of beds. Yeah, discounting the digital nomads and people that come here, love it and then stay and… Yeah, I mean, some are part of it. But yeah. Anyway, so that’s reason number one is government. Hey, let’s write it here. Number one is government. Ooh. Ooh. Ooh. Okay. Number two is I’m going to draw it. And you tell me if you can find what it is. Yeah.

05:35
Up, up. Yeah, quick one. Yeah, quick one. And let’s say this is brown. Yeah, I know what it is. You know what it is? We should actually look up the law. That’s a coconut tree. The infamous coconut tree law. So there’s a law in Bali which dates from 1966, if I’m not mistaken, when the… I forgot the name of that hotel, the Sanur Beach Hotel, I think it’s called, or the Sanur beach resort or whatever. That massive 10, 12 story building. I think 10 story building in Sanur on the shore was built.

06:13
And there was no law back then as to the maximum height of building in Bali. And they built it. And local people say, “Oh, what’s going on here?” We don’t want that stuff. So they consulted with a lot of different NGOs and organizations to find the perfect height for Bali. And all of them said 35 meters, 50 meters, and said, “Okay, 15.” You know, that’s it. So basically in Bali, you have a law which we like to call the coconut tree law, which dictates that building cannot exceed, cannot go above

06:52
the height of a coconut tree, which is 15 meters. I don’t know if you can see well with orange, but… So 15 meters, yeah. So you cannot build anything above 15 meters. That’s the law unless you are Telkomsel, maybe, or GWK (Garuda Wisnu Kencana), I guess. So if you want to build an apartment building, there has to be maximum 15 meters. You won’t get the permit, otherwise, and it might get chopped off if you do it anyway. So 15 meters is about four stories high. You go take it, yeah. Four stories and a little bit of

07:30
roof or something like that, yeah. Why is this important? What does that mean? What does that mean? It means when you go from five million tourists to seven million tourists, for instance, in Bali, okay, those two million tourists, you cannot stack them up, right? You look at Phuket, you have buildings going up. You have any major city in the world. Buildings are growing because you need… You can stack people up, yeah? With that law, you can’t. So development cannot go upward, so it has to be horizontal.

08:07
Or get more dense and then go horizontal. It goes horizontal. There’s no choice because this is the law. So governments bring more people into the country or help bring more people into the country. Bali laws say you cannot build up, so development is, hey, we put an arrow here just for you guys. We’re going that way, okay? It’s not going so much that way. A little bit here, but not here. It’s following the coast because everybody wants to be near the beach. So now, how… So knowing that, how do we identify

08:46
on that coast the next place to invest? Well, you would look for the density where everybody’s hanging out and then getting agitated with how busy it’s getting and then you would go to the next one. And there’s another factor which has to do with these little guys. Yeah, exactly. So while the first factor is those little guys, surf spots are the first to develop. Wherever you go, in Sumba it was the same. I mean, 50 years ago it was… Bali in and of itself is a surf spot. It started off. The only reason why we are on that coast and not on

09:21
Sanur coast is because of Kuta Surf. Back in the 70s and 80s, it was a surfers island. So nobody went to Sanur. There’s no waves. So everybody went to Kuta and Kuta beach is beautiful and the surf is great. So you went Kuta and from Kuta it developed. If we had known it was the beach was so ugly, as in Berawa/Pererenan, the beach is horrible. To be honest, you know? Well, it’s not horrible, but it could be better. It’s not all of us. It could be better. You need to paint it. Or south of France.

09:56
You need to paint it. So surf is one very, very important factor. If you look at how it’s all real estate has developed along the years, it’s very simple. You look at surf spots. So here, this is today, we are shooting right now in Kosong Satu office and Kosong Satu Group office and this is Pererenan, okay, where I’ve been for five, six years now. There is nothing, there’s no surf between Pererenan and Kedungu. So Kedungu will develop. There’s no question. It will. And now, Seseh and Cemagi are already quite developed.

10:37
They’ve been developed by the residencial development, not so many commercial, but Kedungu will take over. It’s a matter of months, years, you know? It will take over and it will be at the same level as Pererenan, Berawa and so on and so forth in like four or five years. Whereas Cemagi, Seseh, in our prediction, will lag a little bit at some point because there’s no beach access. Okay, you look at Cemagi, honestly, it’s horrible. There’s no beach. It’s still cute because there are some rice fields,

11:12
but when it’s over developing. So once you remove all those rice fields, and there aren’t so many left, there’s nothing. There’s no charm. There’s no businesses. There’s only one restaurant, one good restaurant, Riviera in the Blue King, Blue Kale Garden. That’s very new. And that’s all there is. I mean, there’s only one Mini Mart, you know, for kilometers, you know? So Cemagi is horrible. Seseh is very beautiful. I really like Seseh. It will develop, no question. And Nyanyi, is owned by, I mean, half of it is owned by

11:52
Sergei, yeah so by Nuanu, which is a great project. I love it. But it’s, you know, half the village is owned by Sergei. There’s no developer. No, sorry, no surf. If you remove Nuanu from the Nyanyi equation, there’s nothing. The place is beautiful. The beach is beautiful, dark, pitch black sand. It’s really nice. I really love it. But even that development will have a knock-on effect for the growth of Kedungu. Yeah, for sure. And people living there will go there to surf. I mean, at the end of the day, this is a good part of

12:28
the population that loves surfing in Bali. Most of them, yeah. You do? Yeah, I’m happy. No, if there’s no surfing in Bali, I doubt. You wouldn’t be here. I wouldn’t be here. Yeah. But I don’t know any South African that would be here. So yeah, basically that’s, so that’s number three, surf. Or I could have done a little drawing. It’s, yeah. Okay, so. There’s another indicator. It’s basically when you hear people from one area starting to bitch over the area. Like I do now, but Pererenan. This is when, you know, it’s

13:08
starting to move, you know? And when they’re starting to move, so where did they move? They move to the next surf spot. Because there’s a lot of restaurants that are growing. You know, there’s a Padel now, there’s, we are building school. There’s a bunch of things that you need for living, you know? But everybody moved into Pererenan four or five years ago because it was too busy here. Yeah. They started to get too dense, too much traffic. They moved here. It was great, rices paddies everywhere.

13:36
And now we’re having the experience in the same problem that we did here. Exactly the same. We moved here. I mean, originally I moved in alone with my family here. And then, Kosong Satu Group was still in Berawa back in the day. And so. So you also got upset about how busy it was. Yeah, exactly. So I moved here because I was upset about how busy it was. And then we moved the whole group here. We were the very first, I think, foreign office company with a bunch of “bule” to set up shop in Pererenan.

14:11
And we’re still there. We’re still here for, we have another four years on the lease. We’re going to stay another four years. And then we move. I’ll move before four years. I’ll move in one year. With you, my friend. But yeah, so that basically, that’s it. So what’s the fourth? No fourth, just three. There’s no fourths? No. Three critical factors to how regions developing in Bali. Exactly. So, thousand dollar question. What’s next? We’re looking at one, two, and three. Wait, wait, wait, wait. These guys got to say.

14:44
You got to say in the comments. Say in the comments, yeah. You got a free pizza. You got a free pizza at Pickle Pizza in Kedungu, which is our friend Simon, Pizza and Pickle, our friend Simon on Jalan Pantai Kedungu So what do you mean, the next region after Kedungu? Yeah. Okay. I mean, if you look at this, what’s next? Question mark. I mean, we said it 10 times, man. All right. Well, that’s it. Thank you, Gawain. Thank you. Thanks, everyone. It was great. I hope you found it informative. Comment below on what’s the next

15:23
spot and Omri will send you a pizza. Just you got to be in Bali. If you likes pizza. He’s not sending a pizza to Germany. If you likes pizzas, watch our podcast We’re not sponsored by the pizza place. All right. Thank you, everyone. Thanks so much.

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