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Foreigners cannot own land outright in Bali, but they can legally control it for decades through alternative ownership structures.
Indonesian law reserves freehold ownership (Hak Milik) exclusively for Indonesian citizens, making direct land ownership impossible for foreigners. However, three legal mechanisms allow foreigners to secure long-term land rights: Hak Pakai (Right to Use) for up to 70-80 years, Hak Sewa (Leasehold) for up to 80 years total, and PT PMA company ownership for commercial purposes with rights lasting 30-50 years.
If you want to go deeper, you can check our pack of documents related to the real estate market in Bali, based on reliable facts and data, not opinions or rumors.
Foreigners cannot buy freehold land in Bali but can secure long-term rights through leasehold agreements, Hak Pakai titles, or PT PMA companies.
The land acquisition process involves legal due diligence, document preparation, tax payments of around 5-10% of property value, and registration with Indonesian authorities.
| Ownership Type | Duration | Best For |
|---|---|---|
| Hak Sewa (Leasehold) | 25-30 years, extendable to 80 years | Residential properties, villas |
| Hak Pakai (Right to Use) | 30 years, renewable to 70-80 years | Personal residence, long-term living |
| PT PMA Company | 30-50 years, extendable | Commercial developments, investment properties |
| Freehold (Hak Milik) | Permanent | Indonesian citizens only |
| Building Rights (HGB) | 30 years via PT PMA | Commercial buildings, hotels |
| Agricultural Rights | 25-35 years | Farming, retreat centers |
| Forest Concession | Varies | Eco-tourism projects |
Fact-checked and reviewed by our local expert
Daniel Rouquette 🇫🇷
CEO & Co-Founder at Villa Finder
Can foreigners buy land in Bali?
No, foreigners cannot buy freehold land in Bali under Indonesian law.
Indonesian regulations restrict "Hak Milik" (Right of Ownership) exclusively to Indonesian citizens. This means foreigners cannot purchase land with permanent, transferable ownership rights that can be passed down to heirs indefinitely.
However, foreigners can legally control land in Bali for extended periods through three alternative mechanisms. These include Hak Pakai (Right to Use) for up to 70-80 years, Hak Sewa (Leasehold) agreements for up to 80 years total, and PT PMA (Foreign Investment Company) structures that provide building rights for 30-50 years with renewal options.
As of September 2025, these legal alternatives remain the only legitimate ways for foreigners to secure long-term land control in Bali. Nominee arrangements, where Indonesians hold land on behalf of foreigners, are illegal and carry significant risks including potential loss of investment.
It's something we develop in our Indonesia property pack.
What types of land are foreigners allowed to own in Bali?
Foreigners can access three types of land rights in Bali: Hak Pakai, Hak Sewa, and land through PT PMA companies.
Hak Pakai (Right to Use) allows foreigners to use land for residential or commercial purposes for an initial 30-year period, renewable for additional terms up to a maximum of 70-80 years depending on local regulations. This right permits building, living on, or renting out the property but does not include ownership of the underlying land.
Hak Sewa (Leasehold) represents the most common method for foreigners in Bali. Under this arrangement, foreigners lease land from Indonesian owners for 25-30 year terms with extension options that can reach 80 years total. These contracts are notarized and legally binding, providing secure long-term use rights.
PT PMA (Foreign Investment Company) structures allow foreigners to obtain "Hak Guna Bangunan" (Right to Build) through corporate ownership. This mechanism works best for commercial or investment purposes, providing land use rights for 30-50 years with renewal possibilities. The PT PMA must maintain minimum investment thresholds and comply with Indonesian corporate regulations.
Are there any restrictions on the location or size of land that foreigners can purchase in Bali?
Yes, foreigners face location and zoning restrictions when acquiring land rights in Bali.
| Restriction Type | Details | Verification Required |
|---|---|---|
| Zoning Compliance | Land use must match designated zones (residential, commercial, tourism, agricultural) | National Land Agency (BPN) confirmation |
| Tourist Areas | Some prime tourism zones have additional foreign investment restrictions | Local government approval |
| Agricultural Land | Limited access for foreigners, special permits required | Ministry of Agriculture clearance |
| Coastal Areas | Restrictions within 100 meters of coastline | Maritime authority approval |
| Cultural Sites | Buffer zones around temples and cultural monuments | Cultural ministry approval |
| Maximum Size | Hak Pakai titles may have area limits for residential use | BPN regional guidelines |
| Forest Areas | Prohibited for private development | Forestry ministry clearance |
What is the process for purchasing land in Bali as a foreigner?
The land acquisition process in Bali involves seven key steps that typically take 2-4 months to complete.
1. **Property Search and Due Diligence**: Identify suitable properties and verify ownership, land certificates, zoning compliance, tax status, and road access. Ensure the land has proper certification and is not subject to disputes or encumbrances.2. **Legal Structure Selection**: Choose between Hak Pakai, Hak Sewa (leasehold), or PT PMA company structure based on intended use and investment goals. Commercial developments typically require PT PMA while residential use works well with leasehold.3. **Professional Legal Review**: Engage a qualified notary and legal advisor to examine all documentation, check for liens, verify building permits, and confirm land status with relevant authorities.4. **Agreement Execution**: Sign a notarized Sale and Purchase Agreement (PPJB) that clearly outlines terms, duration, renewal options, and responsibilities of both parties.5. **Tax and Fee Payment**: Pay required taxes including 5% acquisition tax (BPHTB), notary fees, and legal costs totaling approximately 8-12% of property value.6. **Registration and Transfer**: File necessary documentation with the National Land Agency (BPN) to register the land rights. For leasehold agreements, the notary manages contract registration while Hak Pakai and PT PMA require additional corporate filings.7. **Permit Acquisition**: Obtain building permits (PBG/IMB) if construction is planned, which can take an additional 1-3 months depending on project scope.What documents do foreigners need to provide to buy land in Bali?
Foreigners must prepare several essential documents for land acquisition in Bali.
Personal documentation includes certified copies of passport with valid pages, proof of funds showing source of investment capital, and visa documentation if applying for Hak Pakai rights. Indonesian tax ID (NPWP) may be required depending on the transaction structure.
Legal documentation encompasses the Sale and Purchase Agreement, original land certificate from the seller, and proof of clear title. For PT PMA structures, corporate documents including company deeds, investment permits, and board resolutions are mandatory.
Financial documentation requires bank statements, proof of international fund transfers, and tax clearance certificates from the seller. All foreign documents must be translated into Indonesian by sworn translators and legalized through Indonesian consulates.
Additional requirements include soil testing reports for construction projects, environmental impact assessments for large developments, and zoning compliance certificates from local authorities.
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Do foreigners need to be in Bali to purchase land, or can the process be done remotely?
Foreigners can complete most land acquisition procedures remotely with proper legal representation.
Remote transactions are possible through power of attorney arrangements with qualified local notaries and legal advisors. These professionals can handle document review, due diligence, contract signing, and registration processes on behalf of foreign buyers.
Key requirements for remote transactions include apostilled power of attorney documents, secure international fund transfer arrangements, and video conference verification for contract signing. Digital notarization has become more common since 2024, streamlining remote procedures.
However, certain steps may require physical presence, particularly final contract signing for high-value transactions, bank account opening for mortgage applications, and initial property inspections. PT PMA company setup often requires founder presence for bank account establishment and permit applications.
It's something we develop in our Indonesia property pack.
What are the taxes, fees, and costs associated with buying land in Bali?
Land acquisition costs in Bali typically range from 8-15% of the property value, depending on the transaction structure.
| Cost Category | Rate/Amount | Paid By |
|---|---|---|
| Acquisition Tax (BPHTB) | 5% of property value | Buyer |
| Notary and Legal Fees | 0.5%-2.5% of value + IDR 16-80 million | Buyer |
| Income Tax (PPh) | 2.5% of transaction value | Seller |
| VAT on New Properties | 10% of building value | Buyer |
| Luxury Tax | 5% for premium properties | Buyer |
| Agent Commission | 3-5% of property value | Typically seller |
| Annual Property Tax (PBB) | 0.1%-0.5% annually | Owner |
Is it possible for foreigners to pay cash when purchasing land in Bali?
Yes, foreigners can pay cash for land rights in Bali, but payments must comply with Indonesian banking regulations.
Cash payments must be made through legitimate banking channels using international wire transfers rather than physical cash transactions. Indonesian banks are required to report large cash deposits and maintain strict anti-money laundering protocols for foreign investment transactions.
Bank transfers are the standard payment method for property transactions, providing clear documentation trails required by Indonesian tax authorities. Payment must be made from accounts in the buyer's name or through established corporate accounts for PT PMA transactions.
Cryptocurrency payments are not legally recognized for property transactions in Indonesia. Installment payment plans are possible for leasehold agreements, with terms typically requiring 30-50% down payment and remaining balance within 6-12 months.
Can foreigners get a mortgage to buy land in Bali, and what are the rates and conditions?
Mortgage options for foreigners in Bali are limited but available through select Indonesian and international banks.
Indonesian banks typically require 40-60% down payments for foreign borrowers, significantly higher than the 20-30% required for Indonesian citizens. Interest rates for foreigners range from 8-15% annually, compared to 6-10% for local borrowers.
International banks operating in Indonesia offer more favorable terms for qualified foreign borrowers, with down payments starting at 35% and interest rates from 7-12%. These banks typically require substantial income verification, Indonesian tax compliance, and minimum relationship balances.
PT PMA structures may access commercial financing for property development projects, with terms varying based on project scope and company financial standing. Mortgage terms typically range from 10-20 years with options for early repayment without penalties.
Alternative financing options include developer financing for new projects, private lending from Indonesian sources, and international mortgage brokers specializing in Southeast Asian markets.
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What common mistakes should foreigners avoid when buying land in Bali?
The most critical mistake is failing to verify land certificates and ownership documentation before purchase.
1. **Inadequate Due Diligence**: Skipping thorough verification of land certificates, ownership history, zoning compliance, and pending legal disputes. Many foreigners lose investments due to purchasing disputed or improperly documented land.2. **Using Nominee Structures**: Relying on informal arrangements where Indonesian citizens hold land on behalf of foreigners. These arrangements are illegal under Indonesian law and offer no legal protection for foreign investors.3. **Insufficient Legal Representation**: Not engaging qualified notaries or legal advisors familiar with foreign investment regulations. Poor legal advice leads to improper documentation and future compliance issues.4. **Ignoring Access Rights**: Failing to verify road access, utilities, and infrastructure availability. Some properties lack legal access roads or utility connections, making development impossible.5. **Underestimating Ongoing Costs**: Not budgeting for annual property taxes, maintenance costs, permit renewals, and potential lease extension fees that can significantly impact investment returns.6. **Rushing the Process**: Attempting to complete transactions too quickly without proper document review and regulatory compliance verification.What is the typical use of land by foreigners in Bali?
Foreigners in Bali primarily use land for rental villa developments and personal vacation properties.
Rental villa construction represents the most common foreign land use, with properties in prime areas like Canggu, Seminyak, and Ubud generating annual rental yields of 7-16%. These developments typically feature 2-6 bedroom villas with private pools targeting high-end tourism and long-term expatriate rentals.
Personal holiday homes account for approximately 30% of foreign land use, with buyers seeking permanent or seasonal residences in tropical settings. Many foreigners combine personal use with rental income, occupying properties during peak seasons and renting during off-peak periods.
Commercial developments through PT PMA structures include boutique hotels, co-working spaces, wellness retreats, and eco-tourism facilities. These projects capitalize on Bali's growing digital nomad population and sustainable tourism trends.
Agricultural and retreat purposes are increasing, with foreigners developing organic farms, yoga retreats, and spiritual centers, particularly in inland areas like Ubud and Tabanan regency.
It's something we develop in our Indonesia property pack.
What is the long-term forecast for the land market in Bali?
Bali's land market outlook through 2030 shows continued strong growth driven by international demand and infrastructure development.
Property values in established areas like Canggu, Seminyak, and Ubud are projected to increase 15-20% annually through 2026, with luxury segment demand leading growth. Government infrastructure investments including the new Bali airport terminal and improved road networks are expected to open previously inaccessible areas for development.
Foreign investment policies are becoming more accommodating, with recent changes to PT PMA regulations and new visa categories for long-term residents. The government's commitment to sustainable tourism development creates opportunities for eco-friendly projects and wellness-focused developments.
Emerging areas including Tabanan, Jembrana, and eastern coastal regions show significant growth potential as prime locations reach capacity. These areas offer lower entry costs and higher yield potential for early investors willing to accept longer development timelines.
Risk factors include potential policy changes regarding foreign ownership, environmental regulations affecting coastal development, and tourism market volatility. Professional legal and tax advice remains essential for navigating the complex regulatory environment and protecting investments in Bali's evolving market.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
While foreigners cannot own freehold land in Bali, legitimate long-term ownership alternatives provide secure investment opportunities for those who understand the legal framework.
Success in Bali's land market requires thorough due diligence, proper legal representation, and realistic expectations about costs and timelines for both acquisition and development.
Sources
- Neginski - Foreigners Buying Property in Bali Legal Options
- Emerhub - Land Ownership in Bali
- Coco Development Group - Legal Regulations Guide
- Bali Villa Realty - How to Buy Land in Bali
- Exotiq Property - Ultimate Guide to Buying Land
- Exotiq Property - Can Foreigners Buy Property
- Bali Exception - Understanding PT PMA
- Emerhub - Common Mistakes When Buying Property
- Coco Development Group - Bali Real Estate Market 2025
- World Estate Homes - Mortgage for Real Estate in Bali