The honest ROI math behind a €245K Lombok villa

Property brochures love gross yield. We're going to start with net yield, because that's the only number that pays your kids' tuition.

The €245K starting line

A turnkey 2-bedroom villa in Selong Belanak — Samudra-spec, 110 sqm built, 200 sqm plot, 30+20 leasehold structure. €245,000 all-in: land lease, construction, furniture, pool, landscaping, registration, and the first 12 months of property management bundled.

That all-in number is unusually clean for the Lombok market. We've benchmarked it against three competing developers in the same zone — most quote €245K too, but exclude furniture (€18–25K), exclude management setup (€4–6K), or quietly exclude the pool equipment (€8–12K). Read the small print twice.

Year 1 — the realistic gross

We modelled 252 nights occupied at an average ADR of €185, which lines up with the actual booking data from three comparable villas we manage. That's €46,620 gross. Year 1 is always weaker than steady-state because OTA listings need time to accumulate reviews, but the Samudra model assumes a soft-launch protected pricing for the first 90 days to bank early reviews fast.

What gets pulled out before you see your bank account

Property management (20% of gross): €9,324. Cleaning, linens, consumables (per booking, ~€18 per turnover): €4,200. OTA commissions (Booking.com 17%, Airbnb 15%, direct 0%): €5,420 weighted. Utilities (PLN, water tanks, internet): €2,800. Insurance (building + liability): €680. Pool/garden maintenance contract: €2,400. Annual leasehold land payment: €1,800. Indonesian withholding tax on foreign-owned rental income (10% PPh 26 on net): €1,950.

Subtotal: €28,574 in deductions. Net rental income year 1: ~€18,046, or 7.4% net on €245K.

That's gross-of-depreciation and gross-of-mortgage. If you financed any portion through European or Australian banks (which you can — we'll cover that in another piece), subtract interest accordingly.

Year 3 — what steady state looks like

By month 30 the listing has matured: 84% occupancy, ADR up 8% to €200 (annual inflation pass-through), maintenance costs up 12% (Lombok prices, not yours), and OTA dependency dropping as direct bookings hit 30% of nights. We model net rental income year 3: ~€26,400 (10.8% on €245K).

The yield improves not because rates explode but because three line items compress: OTA commission drops as direct % rises, management fee % drops if you negotiate to 15% on a 3-year retention contract, and the depreciable cost base of furniture/appliances expires.

Capital appreciation — the real story

Land in Selong Belanak appreciated 38% between 2022 and 2025 (BPN registered land transactions). That's the inflation everyone talks about. But 38% over 3 years is closer to 11.4% compounded annually — which is, for context, slightly lower than the S&P 500 over the same window.

The appreciation case is not "Lombok will be Bali in five years". It's that infrastructure (the new bypass, the airport-circuit road, the seawater desalination plant landed in 2025) crystallised most of the speculative premium already. We're more comfortable underwriting 6–8% land appreciation per year for 2026–2029, slowing to 3–4% as the market matures.

What kills the math

Three failure modes wipe out the model: (1) an absentee owner who self-manages and assumes a 70% occupancy they never hit (most reach 45–55% without professional management). (2) A buyer who pays in EUR but earns rental in IDR and ignores the FX exposure (rupiah has been remarkably stable, but plan for ±8% annually). (3) A villa built at the wrong micro-location — 600m from the beach with no view costs 30% less to buy and earns 50% less in nightly rate.

So is it worth €245K?

If you treat it as a 9% net yield + 6–8% capital appreciation instrument with a 7–10 year hold horizon, the IRR comes in around 12–15%, comparable to a moderately aggressive developed-market real estate fund — but with the lifestyle dividend of actually being able to use the asset 30 nights a year.

If you treat it as a "make 20% a year" speculation, you'll be disappointed.

The first model is the one that has worked for almost everyone we've sold to. The second model is the one we politely talk people out of.