Bali’s short-term rental market has proven its resilience. According to data from REID (Real Info Indonesia) , despite a 107% increase in rental supply over the past three years, occupancy rates have actually improved — climbing to 53% in 2025. This tells us one thing clearly: traveler demand remains strong, and the market is absorbing new supply at a healthy pace.
WHAT TYPE OF VILLA PERFORMS BEST?
Data from 2025 reveals a clear trend: smaller is stronger — especially in South Badung (Uluwatu Area).
Supply Composition: The Market Landscape
Despite the strong performance of one-bedroom units, their supply remains relatively limited. According to REID data:
- Three-bedroom properties lead the market, comprising 29.4% of total listings
- Two-bedroom properties follow closely at 27.8%
- One-bedroom units account for just 15.7% of supply
This supply gap presents a compelling opportunity. While two-bedroom and three-bedroom assets have traditionally dominated the market — representing the convergence of new and old developments — the post-COVID property boom has seen an explosion of compact assets. Yet even with this growth, one-bedroom supply still lags significantly behind mid-sized offerings.
The slight YoY contraction in total listings (-7%) suggests a broad market cooling as developers moderate new projects, making well-positioned compact assets even more valuable.
High Season vs. Low Season Dynamics
While larger villas perform well during peak holiday periods, recent data shows an interesting pattern during low season months: one-bedroom villas consistently achieved the highest occupancy.
Why? These smaller units appeal primarily to couples and solo travelers, a demographic that travels year-round and isn’t tied to school holidays or family vacation windows. Unlike groups and families who tend to book during peak seasons, couples have greater flexibility and continue to drive demand even when the broader market softens.
This makes one-bedroom villas an excellent anchor for year-round revenue stability. They offer:
- Lower price sensitivity — couples are often willing to pay a premium for privacy, design, and location
- Higher turnover potential — shorter stays mean more booking opportunities
- Consistent demand — less reliance on peak season spikes
The Mid-Sized Segment Faces Headwinds
In contrast, three-bedroom properties saw an 8% YoY occupancy decline to 55%, suggesting growing competition and a possible softening in demand for mid-sized rental stock. This segment faces pressure from both ends — competing with smaller, more agile units on one side and larger luxury estates on the other.
What This Means for Investors
For investors looking to enter or expand in Bali, the data points to a clear opportunity: one-bedroom villas in prime locations like South Badung offer resilience and consistent performance year-round. Their ability to attract couples and solo travelers—a demographic that travels regardless of season—provides a stable revenue foundation that larger properties often lack during low season months.
What makes this opportunity even more compelling is the supply gap. With one-bedroom units representing only 15.7% of total listings — compared to nearly 60% combined for two and three-bedroom properties—investors who move into this segment are positioning themselves in a niche with less competition and strong underlying demand.
At Bali Dream Living, we specialize in the Uluwatu area and understand what makes a property perform. Whether you’re considering a compact luxury villa or a larger development, we’re here to help you make informed investment decisions.
Ready to invest in Bali’s most resilient villa segment?
Get in touch with us today.
