More and more foreigners are choosing to live in rented houses or boarding rooms in Bali instead of staying at registered hotels. While it may seem harmless, local business groups warn this growing trend could spell trouble for Bali’s small and medium enterprises (SMEs).
“This has become one of our major concerns. In Canggu, residents have started pushing for foreign nationals not to stay in boarding houses, and here in Karangasem, similar actions have begun,” said Bali Chamber of Commerce and Industry (Kadin) Chairman, I Made Ariandi, before the Karangasem Kadin Regional Conference on Friday (November 7, 2025), as quoted by detikBali.
According to Ariandi, the issue is becoming more serious and could snowball if left unchecked. Many foreigners holding certain types of visas can legally set up businesses in Bali, and some have even begun running hidden operations in sectors traditionally owned by local SMEs. He urged local governments to take quick and firm action to protect local entrepreneurs from being pushed out of their own markets.
Ariandi pointed out that what’s happening in Bali mirrors what occurred in popular Spanish destinations like Barcelona and Mallorca. When foreign tourists began renting homes and staying long term, local housing prices and property values skyrocketed. Locals found themselves priced out of their own neighborhoods, forced to move further away from the city center.
The Barcelona city government eventually had to impose strict limits on short-term rental permits and tightly regulate property conversions into tourist accommodations after realizing how much damage it was doing to local communities.
Read also: Unfortunately, iPhones Still Can’t Use QRIS Tap, Why?
In Bali, a similar pattern is taking shape. Boarding houses and rented houses in Bali that once provided affordable living spaces for local workers and small business owners are now being taken over by foreigners — many of whom work remotely or run informal online businesses. Without regulation, this shift could easily drive up rental prices and the overall cost of living, squeezing locals not only in business but in their daily expenses as well.
Foreigners, especially those from Europe, the United States, Australia, and Singapore, also tend to have stronger currencies and larger budgets. That gives them an edge in renting prime locations, buying better equipment, and offering deep discounts. Local SMEs, with their limited resources, simply can’t compete on those terms.
What’s worse, many of these foreign-run operations don’t have official permits and don’t pay local taxes. This creates an unfair situation where local entrepreneurs have to follow all the rules, pay licensing fees, and bear higher operational costs, while foreign operators often bypass the system entirely.
The presence of these foreigners is also spreading into small-scale businesses — from motorbike rentals and yoga classes to daily tour services, homemade food stalls, and even small barbershops. These are the very sectors that have long supported Bali’s local economy. Without tighter oversight, the growing foreign presence could slowly push local entrepreneurs to the margins of their own island economy.
