Bali Villa Investment: Daily Rentals vs Long-Term Rental in Bali, Which Wins?

Bali Villa Investment - Bali is a top global destination, with ever-growing tourist numbers and steady demand for accommodation. According to Bali’s statistics office, 470,851 foreign tourists arrived in Bali in March 2025, up 4.47% over the previous month. 

Many investors eye the island, but a central dilemma remains: should you run daily rentals (short-term) or go for long-term rental in Bali? This article explores the pros and cons, potential incomes, and decision factors so that your Bali villa is optimized.

In this comparison between villa rental Bali strategies, we’ll break down how an Airbnb Bali villa model stacks up against committing your property to long-term rental.

Understanding Rental Concepts 

a. Daily Rentals (Short-Term) 

In a daily rental model, you rent the villa by the night, much like a boutique hotel or Airbnb stay. You can charge high nightly rates, especially in peak seasons, and accept bookings for days or weeks. With a Bali villa positioned in popular tourist zones, this model can capture premium rates per night.

b. Long-Term Rental Bali (Monthly / Yearly) 

In the long-term model, you lease the property on a monthly or yearly basis. The per-night rate is lower compared to daily rentals, but the rental is stable, and the villa is occupied for longer, uninterrupted periods. The owner of a Bali villa in a residential neighborhood might prefer this approach for predictability.

Breakdown of Potential Income (Case Study) 

Let’s take a hypothetical 2-bedroom villa in Canggu (a popular area) as a model for your Bali villa investment.

Short-Term / Daily Rental Scenario 

For example, let’s say your 2-bedroom Bali villa is priced at USD 98 per night, in line with the 2024–2025 market average. With a 65% occupancy rate (around 20 nights per month), your gross monthly income would be around USD 1,960.

However, keep in mind that this figure is before deducting expenses such as cleaning, utilities, maintenance, staff salaries, and OTA commissions.

In reality, actual performance varies by location and property type. For example, according to Airbtics 2024–2025 market analysis, many villas in Bali average an ADR of around USD 98 with 65% occupancy, resulting in an estimated USD 1,730 monthly income per listing. 

Long-Term Rental Bali Scenario

In a long-term rental setup, the same two-bedroom villa could generate USD 2,000–2,500 per month on a fixed, year-round lease. This model offers fewer turnovers, minimal vacancy gaps, and lower running costs, since expenses like housekeeping and marketing are significantly reduced.

In comparison, short-term or daily rentals can generate around USD 1,960 gross per month (or about USD 1,730 on average after factoring in real market performance). However, operational costs, such as cleaning, maintenance, and staff, tend to reduce the net profit.

On the other hand, long-term rentals typically offer USD 2,000–2,500 per month in stable, predictable income with lower expenses and less day-to-day management required.

Also, seasonality plays a major role. During high season, occupancy can reach 90–100% for short-term rentals; in low season, it may drop below 40%. Long-term tenants buffer your Bali villa from these fluctuations.

Thus, a hybrid model can be optimal: rent daily during peak months, and switch to a long-term lease during the off-season for stability.

Pros and Cons: Which Rental Model Fits Your Villa Best?

Pros & Cons of Daily Rentals / Airbnb Bali villa model 

Short-term or daily rentals, often managed through Airbnb or similar platforms, can offer higher nightly returns, especially during Bali’s peak tourism seasons. Owners can also enjoy flexibility, whether it’s adjusting rates dynamically or blocking certain dates for personal stays.
 

However, this model comes with greater operational complexity. Frequent guest turnover requires regular cleaning, consistent property maintenance, and active marketing across multiple online travel agencies. In addition, income heavily depends on occupancy rates and seasonal demand; revenue can drop significantly during the low season.

Pros & Cons of Long-Term Rental Bali strategy

A long-term rental strategy provides stable and predictable income, since tenants usually sign contracts for several months or even years. This setup also means lower operational costs, with fewer turnovers, minimal cleaning requirements, and reduced marketing or guest service efforts.

However, the trade-off is that the earning potential per night is lower compared to short-term stays. Villa owners may also miss out on sudden rate increases during high-demand periods because the property is already tied to a fixed lease agreement.

A real estate analysis notes that long-term rental models are less sensitive to tourism seasonality, making them more resilient during downturns.

Also, tax and legal treatment differ: in some cases, long-term rental income gets favorable tax handling or simplified administration versus daily rental, but local regulations in Bali and Indonesia must be checked in each case.

Key Factors That Determine Your Bali Villa Investment Strategy

To choose between daily and long-term, several variables matter for your Bali villa investment:

Location

If your villa is in a high-traffic tourist zone (e.g., Canggu, Seminyak, Uluwatu), daily rentals / Airbnb Bali villa model often yield better returns. If it’s in residential outskirts, long-term tenants might be more practical.

Property type & amenities

Luxury villas with beautiful design, private pools, views, and premium amenities favor daily rentals. Simpler villas or houses may be more suited to long-term tenants.

Target market 

Do you aim to host tourists (vacationers) or expatriates / digital nomads? The former aligns with daily rental, the latter with long-term rental in Bali.

Risk tolerance & management capacity 

Daily rentals demand more active management. If you prefer a more “hands-off” investment, long-term rent may suit you better.

Regulatory & legal environment

Check local zoning, licensing, tax laws, and tourism regulations in Bali. Some regions may restrict short-term rentals or impose extra fees or licensing requirements on villa rental Bali operations.

Conclusion 

In conclusion, there’s no one-size-fits-all answer for your Bali villa investment. Daily rentals (Airbnb Bali villa model) can deliver higher revenue, especially during peak seasons, but come with more work and volatility. Long-term rental in Bali provides income stability, lower operating headaches, and less sensitivity to seasonality, but with lower upside.

If your focus is aggressive cash flow and you can manage operations, the daily rental path may reward you. If you prefer predictability and minimal fuss, choose long-term leasing. Many savvy owners adopt a hybrid approach, daily in high season, long-term in slow months.

If you’re unsure which strategy fits your asset and profile, BVR Property can help you analyze ROI, forecast cash flow, and manage your Bali villa portfolio.