How Foreigners Can Buy Property in Bali

Buying property in Bali is possible for foreigners, but it does not work in the same way as buying freehold property in many other countries. Indonesia uses several distinct land-right categories, and the correct structure must be selected before any deposit or binding agreement is signed.

Start with the underlying land right

Under Indonesia’s Basic Agrarian Law, Hak Milik — the strongest form of individual freehold title — is generally reserved for Indonesian citizens. A foreign buyer should therefore be cautious if a property is advertised simply as “foreign freehold.”

The practical question is not only whether a foreigner can buy a building. It is which registered or contractual right will support the buyer’s occupation, control, transfer rights and intended use.

The principal routes

1. Long-term leasehold

A leasehold is a contractual right to use a property for an agreed period. It is widely used in Bali because it can suit private residences and investment properties without transferring Hak Milik title to the foreign lessee.

The lease should clearly address the term, extension mechanism, payment schedule, access, construction rights, assignment, inheritance, permitted use, taxes, maintenance and what happens to improvements when the lease ends. The landowner’s identity and authority must be independently verified.

2. Hak Pakai for an eligible residence

Government Regulation No. 18 of 2021 and its implementing rules provide a framework under which qualifying foreign nationals holding immigration documents may own an eligible residence through Hak Pakai, subject to applicable conditions and local restrictions.

Rules can include minimum property values, land-area limits, limits on the number of properties and residential-use requirements. The exact eligibility of a specific property must be confirmed with the relevant land office, notary or PPAT before purchase.

3. A properly established Indonesian company

A foreign-owned Indonesian company, commonly called a PT PMA, may hold rights appropriate to its approved business activities, including Hak Guna Bangunan in qualifying circumstances. This is a corporate investment route, not a substitute for personal ownership.

The company must have a genuine commercial purpose and comply with incorporation, licensing, capital, tax and reporting obligations. The property use must align with the company’s approved activities and applicable zoning.

Due diligence before paying

Marketing material and a site visit are not enough. A buyer’s professional team should independently review:

• The land certificate, registered owner and chain of title.
• Zoning and whether the planned residential or commercial use is permitted.
• Road access, boundaries, survey results and any encumbrances or disputes.
• Building approvals, including relevant PBG and SLF documentation.
• Outstanding land tax, utilities and community obligations.
• The seller’s authority, marital consents and corporate approvals where applicable.
• Lease extension wording, transfer rights and exit provisions.

A safer purchase sequence

1. Define whether the property is for residence, rental operation, development or resale.
2. Select an independent lawyer, notary or PPAT before signing.
3. Complete title, zoning, permit and seller due diligence.
4. Choose the legal structure based on the verified property and intended use.
5. Use a written conditional agreement before releasing substantial funds.
6. Complete execution, registration, tax payments and handover through the appropriate professionals.

The right structure is property-specific

There is no single structure that is best for every foreign buyer. A residence, operating rental villa and multi-unit development each raise different questions. The safest approach is to verify the property first, then select a structure that matches the buyer, the title and the intended activity.