Anteya Research
Bali vs Phuket Rental Yields: Compare Net Returns
1 septembre 2026
A higher advertised rental yield does not necessarily leave more money in the owner's account. A Bali villa with strong bookings can carry substantial private operating costs. A Phuket condominium may earn less rent but have a different cost structure. Neither description establishes which investment performs better.
The useful Bali vs Phuket rental yield comparison is property-specific: the same definition of income, the same expense categories and a clearly stated capital base. Start there before comparing percentages—or accepting a promise that either island pays for itself within a particular number of years.
Gross yield and net yield answer different questions
Gross rental yield divides annual rental revenue by the stated property cost. It does not show the expenses required to earn that revenue.
For this comparison, net operating yield means annual rental revenue minus operating expenses and a replacement reserve, divided by total acquisition-and-setup capital. It is before borrowing costs and the owner's income taxes. Those exclusions matter: it is not an after-tax return or a cash-on-cash return on a financed purchase.
Include acquisition charges and initial furnishing in the denominator when they are necessary to deliver the rentable property. Show any separate cash reserve as additional capital committed, rather than pretending it is free. If a seller uses purchase price alone, recalculate both properties on your chosen basis.
An equal-budget example: higher gross income, identical net yield
The following figures are entirely hypothetical teaching examples. They are not market averages, observed properties or forecasts for Bali and Phuket. Both assume lawful rental operation and a full operating year.
| Annual calculation, US dollars | Illustrative Bali property | Illustrative Phuket property |
|---|---|---|
| Acquisition and setup capital | $300,000 | $300,000 |
| Gross rental revenue | $42,000 | $36,000 |
| Distribution and management | $8,400 | $6,000 |
| Other operating expenses | $7,200 | $4,200 |
| Annual replacement reserve | $2,400 | $1,800 |
| Net operating income after reserve | $24,000 | $24,000 |
| Gross yield on stated capital | 14.0% | 12.0% |
| Net operating yield after reserve | 8.0% | 8.0% |
The Bali example earns $6,000 more gross rent and spends $6,000 more to operate and reserve for replacements. The net result is identical. Reversing the cost assumptions could reverse the outcome; the island labels do not determine it.
The point is not that these are the returns to expect. It is that a gross-yield comparison can conceal the entire difference you are trying to measure.
Build the expenses from the property upwards
For a villa, request actual costs for staffing, pool and garden care, cleaning, utilities, repairs, insurance and management. For a condominium, obtain the common-area budget, any reserve-fund obligations, private-unit maintenance and the operator's charges. Check what is included so the same service does not appear twice.
Then examine the fee base. A percentage charged on the guest's total payment is different from the same percentage charged after platform commission and refunds. Ask whether cleaning is paid separately by guests, retained by the operator or deducted from the owner's proceeds.
Transaction taxes, operating taxes and the owner's personal tax position also belong in the wider cash-flow model. Do not paste one national headline tax rate into both columns. The structure and taxpayer matter; obtain professional estimates for the actual purchases.
Anteya's Bali villa pro-forma guide provides a related framework for building the Bali side of the analysis.
Test revenue monthly, not through one annual occupancy claim
Ask for monthly owner statements supported by booking records. Separate paid stays from owner use, cancellations, maintenance closures and complimentary nights. Establish whether occupancy is measured against all calendar nights or only nights made available for booking.
A property available for 300 nights and occupied for 210 has 70% occupancy of available nights. Those 210 nights represent approximately 57.5% of a 365-day year. Both descriptions can be mathematically correct; they cannot be substituted without adjusting the revenue model.
Use achieved nightly rates after discounts, not the highest rate visible on a booking calendar. For a monthly tenancy, work from the signed rent, vacant intervals, collection history and allocation of utility and repair costs. The two rental models need different evidence.
Rental permission comes before the upside scenario
In Phuket, Thailand's Hotel Act distinguishes accommodation established for monthly-or-longer service only from shorter-stay operations. A property advertised on a booking platform is not, by itself, proof that the proposed operation is compliant. See the DOPA-hosted English translation of the Hotel Act, section 4; the Thai legal text governs.
For Bali, match the actual accommodation activity to the current business permissions through Indonesia's OSS system, alongside the property's other required approvals. Do not treat a residential right as automatic permission for a rental business.
These checks change underwriting. If a short-stay model has not been established as lawful for the property, its projected income should not be your purchase-case revenue.
Stress-test the same disappointment on both sides
Return to the hypothetical example and reduce revenue by 20%. Hold the original total expenses and reserves unchanged as a deliberately simplified stress test:
- Bali example: $33,600 revenue minus $18,000 costs and reserve = $15,600, or 5.2%.
- Phuket example: $28,800 revenue minus $12,000 costs and reserve = $16,800, or 5.6%.
Real variable expenses may fall when bookings fall. Rebuild those lines separately once you have the contracts. This fixed-cost test simply exposes how the same revenue shock can affect two cost structures differently.
Also test a major repair, delayed opening and several peak-season weeks reserved for your own use. Subtract owner-use nights before calculating bookings; do not deduct their lost rent a second time later.
Annual yield is not the whole investment return
A lease-based investment also has a remaining term. A freehold asset still has maintenance, market and sale-price risk. Comparing annual income alone does not account for either property's eventual sale proceeds or expiry.
Keep rental cash flow separate from assumed capital appreciation. A rent guarantee also needs its own analysis: who owes the payment, what secures it, what exclusions apply and what happens if the operator fails? Anteya's guide to checking developer ROI promises covers those questions in more detail.
Frequently asked questions
Does Bali have higher rental yields than Phuket?
An individual Bali property may outperform an individual Phuket property, or vice versa. A credible comparison needs matched cost definitions, operating records and purchase terms; an island-wide marketing percentage cannot settle it.
Is a quoted net yield after tax?
Not necessarily. Ask for the full formula and exclusions. In this article, net operating yield is after operating expenses and a replacement reserve, but before finance and owner income taxes.
What should I request before choosing a property?
Ask for the purchase-and-setup budget, monthly revenue evidence, an itemised expense schedule and confirmation of the intended rental model. For a Bali shortlist, ask Anteya to identify which figures are documented and which remain assumptions.
The worked examples are educational, not investment forecasts or personalised financial advice.
