How Foreigners Can Legally Rent Out an Airbnb Villas in Bali

Foreigners who want to rent out their Airbnb villas in Bali cannot just do so without compliance with the law. Find out more.

Anyone with an interest in Bali knows that the Airbnb villas available on this island are getting more and more plentiful. In addition, the quality of these Airbnb villas makes Airbnb Bali way better than Airbnb anywhere else in the world.

How Foreigners Can Legally Rent Out an Airbnb Villas in Bali

The growth of the Airbnb villas is no-brainer: Bali has been going through a rapid economic transformation due to the tourism boom over the past decade.

While most visitors stay in the regular hotels and guesthouses, a higher number of them has gradually opted for private Airbnb villas that promise more authentic local experience and serene environment.

What is more, because of the large space of Airbnb villas in Bali, many foreigners will use their villas as venues for other activities such as weddings, birthday parties, or just simply as holiday accommodations for larger groups of family and friends. Therefore, to manage Airbnb in Bali is something that you need to consider for your business venture.

The beautiful landscape, warm climate and friendly environment in Bali have attracted 5.7 million foreign visitors in 2017 alone, making the island of the top vacation spots in the world. This has resulted in more and more investors tapping into the Airbnb villas business.

This article provides you with essential information on how you, as a foreigner, can rent out your Airbnb villa in Bali legally.

Can foreigners rent out Airbnb villas?

Though renting out an Airbnb villa in Bali seems to be one of the most common business activities among foreigners, you need to be clear that villa rental in Bali is actually not included in the Indonesian Positive Investment List (PIL).

What licenses/permits do you need to rent out Airbnb villas?

In general, there are two important licenses/permits you will need when you consider starting a villa business in Bali: accommodation license and building license (Izin Mendirikan Bangunan – IMB).

Accommodation License

Depending on the type of housing and the number of rooms, there are two types of accommodation licenses: homestay licenses and hotel licenses.

If you have an Airbnb villa between 3 to 5 rooms, you will need a homestay license or Pondok Wisata license; and if you have a property with more than 5 rooms, you will need a full hotel license known as a Melati license.

It is worth noting that obtaining a hotel license is not an easy feat due to the stringent requirements set out by the Indonesian government.

Building License

In addition to the accommodation license, a building license or IMB is necessary. Holding an IMB means that you are permitted to build a property for your Airbnb villa rental.

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Pandu Biasramadhan

Pandu is the Consulting Manager at Cekindo. He has extensive experience in working with government agencies. Notably, he has provided market-entry solutions for enterprises in Indonesia and managed regional partnership channels in Southeast Asia. At Cekindo, Pandu aspires to lead the consulting team to provide top-quality market-entry services and maintain a portfolio of global clientele. His specialty is market-entry advisory and business process outsourcing.