May 16, 2024 | Investment | 0 comments

​We are constantly surprised by the demand for raw un-serviced land here in Lombok. New entrants to the market are almost always of the opinion that buying land and building is the proven path to investment success in this emerging market. It is an opinion we find hard to understand. If your goal is to build your dream home regardless of the time, cost and stress, no need to read on. If at least part of your consideration is investment led, here are our insights from analysing projects all day everyday here in Lombok over many years that might give you food for thought.

 

Crunching the numbers for your potential investment? Did you account for your time?

If you analyse the returns of purchasing an existing villa versus developing your own, how much do you value your time? For any building project to be successful you need to invest significant time and attention into your project. Do you add serious value here, or will you need consultants to step in and do the heavy lifting at a cost?

Purchase an existing villa, collect rent from day one, expect capital gain over time and enjoy passive income. Or be ready for a two year project before that first guest steps foot in the pool. 

When does the income start coming in? 

Existing villa, its immediately, develop yourself, well thats uncertain. Making back that lost time and income takes many years if your build does not go to plan. 

 

Have you considered construction risk? 

It doesn’t matter where you operate these days, builder margins are being squeezed, quality control is paramount and the more you can be on the ground overseeing your project the better. Will you be on-site on a daily basis? We certainly have been for our personal investment projects. 

Can you get that prime site?

Guess what, a lot of the prime sites now have villas on them or aren’t for sale. If you want a prime location, buy an existing property or start looking further out. 

We know most investors go on that gut feel. We welcome that spreadsheet that shows us how a first time entrant can beat the potential returns of these projects:

Habitat Villas

Aloha Villas

Marlaca Villas

Villa Strata

Want to profit on Lombok Real Estate? Who said it had to be hard and you will be rewarded for your effort? Sometimes the easy path can be the most profitable, and that’s a win-win. 

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