Bali Care / Bali Tourism Blog

Whilst holiday rental has just started its popularity within the last few years, just like the whole Bali tourism industry, holiday rental business has been seeing 2008 as the most successful year in the history. Regardless global financial crisis affecting the main feeding countries of Bali tourism such as USA and Europe, the holiday season at the closing of 2008 has been pleasingly lucrative. Villa rental agencies were busy looking for available villa for their desperate clients wanting to spend their holiday in Bali villas. Demands have been by far exceeded available supply.

As the peak holiday season expired and the last client depart, worries started to arose. A perfect combination of low season and impact of global financial crisis came as a potential threat. “We have to be very careful in controlling our spending as we have to ensure that we have enough to run our business during the slow period,” an owner of a prominent holiday rental agency in Bali said. “We have been seeing Bali tourism survived worse situation, so there is nothing to worry about. Just business as usual,” another one expressed a more optimistic opinion.

I personally have not that much of worries. With price ranging from $500 to over $3,000 per night, target market of villa rental is wealthy business owners and investors. Crisis may force them t reallocate their portfolio or even significantly cut capitalization of their assets, but it will not affect their lifestyle. If Bill Gates lost 5 billion dollars, will he sell his private jet and fly commercial flight instead? Definitely not. There are a lot of executives and professionals are loosing their job and therefore will no longer afford to spend a holiday, but those people are in $100 - $200 resort hotels’ market range.

Nevertheless, I carefully watch the situation in my own company. It is correct that we do not have many in-house clients in January and probably February as well. But those months are in low season anyway. However bookings for the coming months do not show any evidence of financial crisis. From income point of view, January 2009 has been a good month. I believe that other agents were experiencing similar situation.