Yes, foreigners can build a house in Bali, but they need to have an Indonesian partner or company as a nominee to hold the land ownership title. Foreigners are not allowed to directly own land in Indonesia, including Bali.
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Yes, foreigners can build a house in Bali, but they need to have an Indonesian partner or company as a nominee to hold the land ownership title. Foreigners are not allowed to directly own land in Indonesia, including Bali.
In order to build a house in Bali, foreigners need to follow certain legal procedures. They can either lease land for a specified period of time or opt for a long-term lease agreement commonly known as a “Right to Use” (Hak Pakai). This allows foreigners to have control and use of the land for an extended period, typically up to 25 or 30 years, renewable for another 20 years upon expiration.
It is important to engage the services of a reputable notary or legal advisor who specializes in property transactions to ensure compliance with local regulations and to navigate the complex process of acquiring land in Bali.
According to a well-known resource on property investment, Simon Gilby from Bali Real Estate Guide, “Foreigners can build a house in Bali, but they must be aware of the limitations and legal requirements. Partnering with an Indonesian nominee is the most common way to proceed.”
Here are some interesting facts to consider:
- The restriction on foreign land ownership in Bali is governed by Indonesia’s Agrarian Law, which prohibits direct ownership by foreigners.
- The Indonesian nominee system involves a legal agreement with an Indonesian citizen or an Indonesian company, who holds the land title on behalf of the foreigner.
- The partnership agreement between the foreigner and the Indonesian nominee should be carefully drafted to protect the interests of both parties.
- Foreigners can also explore other legal options such as establishing a foreign-owned company in Indonesia to hold the land ownership, while considering the necessary corporate and legal procedures.
- The Indonesian government has recently taken steps to simplify the process for foreigners to acquire land, by introducing a draft Omnibus Law that aims to relax restrictions on foreign property ownership.
Here is a table comparing the key aspects of leasing land and the “Right to Use” option:
| Land Leasing | Right to Use (Hak Pakai) | |
|---|---|---|
| Duration | Varies, typically 5-25 years | Up to 25 or 30 years, renewable for another 20 years |
| Renewal Options | Typically renewable upon expiration | Renewable for an additional 20 years upon expiration |
| Land Ownership | Belongs to the lessor | Belongs to the Indonesian nominee or company |
| Usage and Control | Limited control and usage rights | Full control and usage rights |
| Legal Structure Required | Requires a lease agreement | Requires a Right to Use agreement |
| Notary/Legal Advisor | Advisable to ensure proper process | Recommended for legal compliance |
While the process of building a house in Bali as a foreigner may involve additional complexities, with proper guidance and compliance with local regulations, it is indeed possible to realize your dream of owning a home in this beautiful Indonesian island.
Remember, as acclaimed businessman Warren Buffett once said, “Risk comes from not knowing what you’re doing.” So, ensure you have a clear understanding of the legal requirements and work closely with professionals to make informed decisions while building your dream house in Bali.
Check out the other solutions I discovered
As a foreign national, you cannot directly own land in Indonesia, but you can own a building on land that you lease from the government or a local owner. You can do this by obtaining a Hak Guna Bangunan (HGB) or Right to Build and Own.
Buying Property in Bali as a Foreigner
- Only purchase property with Hak Pakai (The Right to Use), Leasehold and HGB (Right to Build) certificate titles.
- Have a valid KITAS visa (Temporary Residency Permit)
How to buy property in Bali
- Send completed forms and supporting documents to the Indonesian National Land Office. Your representative will usually do this.
- You must provide proof of land payment to be eligible for Hak Guna Bangunan and Hak Pakai.
The answer to this question is yes, you can build a home in Bali. However, there are a few things you need to keep in mind before you do. First, you will need to get approval from the local authorities. This process can be a bit complicated, so it is best to hire a local lawyer to help you with it.
Answer in video
In this YouTube video, the narrator provides a comprehensive guide on buying a Bali villa. They discuss three main ways to purchase a villa – buying a ready-made villa, buying an off-plan villa, or buying land and building your own villa. Each option has its own advantages and risks, and the narrator emphasizes the importance of thorough due diligence before making any purchase. They also highlight the need to build relationships with locals to save costs and find unique properties. The narrator delves into the costs involved in building a villa, the different types of land ownership, and the legal documentation required. They also provide insights into the potential return on investment for renting out villas in Bali. Overall, the narrator offers valuable information and encourages viewers to subscribe for more Bali-related content.