<figure class="wp-block-audio"><figcaption class="wp-element-caption">How Foreigners Can Buy Property in Bali Indonesia</figcaption></figure>

Buying property as a foreigner in Bali can be a complex process due to Indonesian regulations that prohibit outright ownership of freehold land by foreigners. However, there are several legal ways foreigners can invest in property in Bali. Here’s a step-by-step guide:

1. Understand Indonesian Property Ownership Structures

There are three main types of property ownership structures available to foreigners in Indonesia:

• Leasehold (Hak Sewa): Foreigners can lease property for an initial period of 25 to 30 years, with the option to extend for up to 70 or more years. This is a common way for foreigners to acquire property in Bali.



• Right to Use (Hak Pakai): Foreigners can legally own a property (like a house) through a Hak Pakai title, which allows use of the land for an extended period (25-80 years). This is granted for residential purposes but does not give full ownership of the land.



• Nominee Arrangement (Not Recommended): This involves purchasing property under an Indonesian citizen’s name, but it is risky as it relies on the trustworthiness of the nominee and may not provide full legal protection.

2. Seek Legal Assistance

Before making any purchase, it’s crucial to consult with a legal professional who specializes in Indonesian property law. They can help you navigate the complexities of property ownership, verify the title, and ensure all documents are in order.

3. Choose the Right Property

• Villa: Many foreigners purchase villas under leasehold agreements. Make sure the property has the proper building permits and is located on land zoned for residential purposes.



• Land: Purchasing land for development is possible through a leasehold or using an Indonesian PT PMA (foreign investment company) to hold the title.

4. Use a PT PMA (Foreign Investment Company)

Foreigners can set up a PT PMA (Penanaman Modal Asing), a foreign investment company, to purchase property for commercial use (e.g., hotels, rental villas). The company holds the land under a Hak Guna Bangunan (right to build) title for up to 80 years.

5. Due Diligence

Thorough due diligence is essential before any property purchase in Bali. This includes:

• Verifying the land or property title is clear and not subject to disputes.



• Ensuring the property has the proper licenses and permits (IMB for buildings).



• Checking zoning laws to ensure the land is designated for your intended use (e.g., residential, tourism).

6. Create a Lease Agreement

If purchasing under a leasehold agreement, work with a notary to draft a lease agreement that protects your interests, clearly outlining the terms, duration, and renewal process. The lease should be registered with the National Land Agency (BPN) to ensure its legality.

7. Payment and Taxes

Property transactions are typically conducted in Indonesian Rupiah. Make sure all payments are properly documented, and work with your legal advisor to ensure tax compliance. Key taxes include:

• Property Acquisition Duty (BPHTB): 5% of the property’s value.



• Annual Property Tax (PBB): Based on the value of the property.

8. Get Insurance

Make sure you obtain insurance for your property to cover natural disasters, theft, or other potential damages.

9. Plan for Exit Strategy

Since foreigners can’t own freehold property, it’s essential to consider an exit strategy, such as selling the remaining years of your leasehold to another foreign buyer or extending your lease.

By following these steps and working with legal and property professionals, you can successfully buy and manage property in Bali as a foreigner.

The post How to Buy a Property in Bali as a Foreigner appeared first on DreamBaliHomes.com.