Should you renovate a villa in Bali?

A large share of Bali's existing villa stock is ten to twenty years old, which means renovation is part of many purchases whether the buyer planned it or not.

What typically needs doing on older stock

The pool. Resurfacing, tiling, plumbing and filtration. Bali pools have a finite life and the failure is rarely dramatic — it is a slow decline in the thing that most affects your nightly rate.

Roof and waterproofing. The most consequential item and the least visible. Bali rainfall finds every weakness, and water damage compounds.

Electrics. Older installations frequently lack adequate earthing, safety cutouts and the capacity for multiple aircon units and a pool pump.

Aircon. Units have a working life and older ones cost more to run, cool less and are noisy, which appears in reviews.

Drainage, around the building and across the site. Failure here causes everything else.

Bathrooms, which date faster than anything and which guests judge.

Joinery and timber, where humidity and termites do their work.

Kitchen, where the standard expected by guests has risen considerably.

What it costs

Cosmetic refresh — paint, soft furnishings, styling, minor repairs — USD 10,000 to USD 25,000 for a three bedroom, and it is the highest return per dollar available.

A pool resurface and plant replacement is a meaningful standalone cost and almost always worth doing.

Full renovation of an older three bedroom, including roof, electrics, bathrooms, pool and kitchen, commonly runs USD 60,000 to USD 150,000 depending on condition and specification.

At the upper end of that, compare it honestly with demolishing and rebuilding, which at USD 500 to USD 700 per square metre may produce a better building for a similar number — provided the remaining lease term justifies it.

The permit position

This is the part that catches people.

Cosmetic work — paint, fittings, furniture, landscaping — generally does not engage the building permit framework.

Structural alteration, extension or change of layout does. If you are changing the building's footprint, structure or configuration, you are likely in PBG territory, and the finished building must match what is approved or the SLF fails.

And any extension has to respect KDB coverage limits and setbacks — road, boundary, river and coastal. A great deal of older Bali stock was built when enforcement was lighter, which means the existing building may already be at or over the limit, leaving no room to extend lawfully.

Establish this before designing anything. Discovering it after the drawings are done is expensive and discovering it after work has started is worse.

Renovating on leased land

Two additional questions.

Does the lease permit it? An express right to build or alter, at the scale you intend. Many leases are silent, which is not the same as permitting.

How many years remain? This is the decisive one. Spending USD 100,000 renovating a property with eleven years left is spending USD 100,000 you will not recover, because the building follows the land at expiry and the remaining income will not cover it.

The working test: can the renovation pay for itself through additional income and use within the remaining term, with a margin? If not, do the cosmetic work and leave the rest.

How to run it

Get quotes from three contractors against a written specification, not against a description.

Pay against completed work inspected by your architect or project manager, never ahead of it.

Hold retention of five to ten percent through a defects liability period.

Expect to find more than the survey showed. Older buildings hide things. A fifteen to twenty percent contingency is realistic, not pessimistic.

Schedule around the season. Renovating through peak costs you the year's best revenue. The February and March trough is the obvious window, though it is also the wet season, which slows external work.

Where the return actually is

In order of return per dollar: photography of the finished result, paint, the pool, outdoor space and garden, bathrooms, then everything else.

Structural work is necessary rather than profitable. It protects the asset; it does not raise the rate. The visible, photographable improvements are what change what you can charge.