How to buy a house or other real estate in Bali?

Do you dream of owning a house in Bali? Buying a house or other real estate in Bali, or elsewhere in Indonesia, is possible, but there are specific rules you must follow. Foreigners cannot own land in full ownership (freehold) in Indonesia, but there are alternatives such as leasehold and freehold through an Indonesian company (PMA or PT) that make this possible.

Leasehold
With leasehold, you lease the land for a predetermined period, usually 25 years. This is the most common form of ownership for foreign investors. After the lease period, the contract can often be extended.

Freehold through a PMA or PT
Freehold means full ownership of the land, but this is only possible if you set up an Indonesian company, such as a PMA (Penanaman Modal Asing) or a PT (Perseroan Terbatas). With these structures, foreign investors can indirectly own land.

If you’re ready to invest in a house in Bali, follow these steps to ensure a smooth process:

• Find a local real estate agent or lawyer
  Finding a reliable agent or lawyer with local knowledge is essential. They can guide you through the legal and administrative aspects of buying real estate in Indonesia.
• Find your ideal location for property
  Decide which region of Bali you want to invest in. Whether you choose the touristy south, the quiet north, or cultural centers like Ubud, the location will greatly affect the return on your investment.
• Make an offer and negotiate
  Negotiate the price with the seller. It's common to negotiate in Indonesia, so make sure you get a good deal.
• Ensure the proper documentation
  You’ll need documents such as your passport and the property’s ownership papers. Make sure all paperwork is in order before proceeding with the purchase.
• Optional: Set up a PMA
  If you want to own a freehold property, you’ll need to establish a PMA. This can be time-consuming, but it allows you to fully own land.
• Complete the purchase with a notary
  When buying property in Indonesia, it's mandatory to complete the transaction with a notary. The notary ensures all documents are properly registered.
• Pay the agreed price and other costs
  Once the notarial deed is signed, you pay the purchase price and any additional costs, such as notary fees and taxes.
• Register the property with the Land Registry
  After the transaction is complete, you must register the property with the Indonesian land registry to ensure it is officially in your name.

While buying a house in Bali as a foreigner involves some specific steps and regulations, the process can be successfully navigated with the right guidance. Whether you choose leasehold or freehold via a PMA, by following these steps, you can safely invest in the thriving real estate market in Bali.