Authored by the expert who managed and guided the team behind the Indonesia Property Pack
Everything you need to know before buying real estate is included in our Indonesia Property Pack
Yes, US citizens can legally buy residential property in Indonesia in 2026, but there are important restrictions on land ownership that you need to understand before making any purchase.
This guide covers everything from legal rights and taxes to mortgages and US tax implications for Americans looking to buy property in Indonesia.
We constantly update this blog post to reflect the latest regulations and market conditions in Indonesia.
And if you're planning to buy a property in this place, you may want to download our pack covering the real estate market in Indonesia.
Fact-checked and reviewed by our local expert
Daniel Rouquette 🇫🇷
CEO & Co-Founder at Villa Finder
Can a US citizen legally buy residential property in Indonesia right now?
Can I buy a home in Indonesia as a US citizen in 2026?
As of early 2026, US citizens can legally purchase residential property in Indonesia, but they cannot own freehold land (Hak Milik) and must instead use designated foreign ownership pathways such as Hak Pakai (Right to Use) or strata title for apartments.
The standard buying process for a US citizen involves finding a property that meets the minimum price requirements for foreigners, obtaining the necessary immigration documents such as a valid visa or stay permit, registering for a tax ID (NPWP), opening a local Indonesian bank account, and working with a licensed notary (PPAT) to complete the legal transfer under Hak Pakai or strata title.
By the way, we've written a blog article detailing all the foreigner rights regarding properties in Indonesia.
Are there many Americans buying property and living in Indonesia in 2026?
As of early 2026, there is no official Indonesian government dataset that tracks property purchases by nationality, but Americans represent a visible portion of the estimated 30,000 to 40,000 foreign nationals residing long-term in Indonesia, with the majority concentrated in Bali and Jakarta.
American expats in Indonesia tend to cluster in specific neighborhoods, with Bali's Canggu, Seminyak, Ubud, and the Bukit Peninsula (Uluwatu area) being the most popular destinations, while in Jakarta, areas like Kemang, Menteng, and South Jakarta attract American professionals and their families.
The top three reasons Americans choose to buy property and relocate to Indonesia include the significantly lower cost of living compared to the United States, the tropical lifestyle and natural beauty especially in Bali, and the growing remote work culture that allows digital nomads and entrepreneurs to run businesses from anywhere.
The American expat community in Indonesia appears to be growing steadily, driven by the expansion of digital nomad visas, increased tourism that converts into long-term stays, and Indonesia's government efforts to attract foreign investment through relaxed property regulations introduced in recent years.
Do foreigners have the same buying rights as locals in Indonesia?
No, foreigners and Indonesian citizens do not have equal property buying rights in Indonesia, as freehold ownership (Hak Milik) is reserved exclusively for Indonesian citizens, while foreigners including Americans must use Hak Pakai (Right to Use) or strata title pathways with minimum price restrictions that do not apply to locals.
Foreigners are restricted from purchasing properties below certain price thresholds that vary by province and property type, and they cannot buy agricultural land, properties in certain strategic zones, or land exceeding 2,000 square meters without special permits.
We cover all these things in length in our pack about the property market in Indonesia.
Can I buy property in Indonesia without a residence permit?
The formal legal requirement for foreigners buying property in Indonesia is to have valid immigration documents, which can include a passport with a valid visa rather than necessarily requiring a full residence permit (KITAS or KITAP).
However, the practical reality of buying property in Indonesia while living abroad as a non-resident involves significant challenges including difficulty opening a local bank account, limited access to mortgage financing, and complications with ongoing property management and tax compliance.
Buying property in Indonesia does not automatically grant any visa or residency rights to foreign owners, as property ownership and immigration status are treated as completely separate matters under Indonesian law.
The main practical challenge non-resident buyers face when completing a property purchase remotely in Indonesia is the banking system, as most Indonesian banks require physical presence and a valid stay permit to open an account, and international wire transfers for property transactions face strict anti-money laundering scrutiny.
Can US citizens own land in Indonesia?
US citizens cannot own land outright in Indonesia through freehold title (Hak Milik), as this ownership type is constitutionally reserved exclusively for Indonesian citizens under the Basic Agrarian Law.
The main difference between freehold and leasehold in Indonesia is that Hak Milik grants permanent ownership transferable through inheritance (available only to Indonesians), while Hak Pakai (Right to Use) available to foreigners provides registered land rights for an initial 30 years, extendable by 20 years, and renewable for another 30 years, totaling up to 80 years of secure use.
Foreign land ownership is restricted in all areas of Indonesia regardless of geography, though the practical limitation is the minimum price thresholds which vary by province, ranging from IDR 2 billion (approximately $120,000 or €100,000) for houses in less developed regions to IDR 10 billion (approximately $600,000 or €500,000) for houses in Jakarta.
What documents will I need to buy in Indonesia?
The essential documents a US citizen needs to purchase property in Indonesia include a valid US passport, Indonesian immigration documents (visa or stay permit), proof of funds documentation, and property-specific paperwork from the seller including the land certificate, building permits, and latest property tax receipts (PBB).
A local tax identification number (NPWP) is commonly required for foreign buyers in Indonesia for tax and administrative purposes, and you can obtain one by visiting the local tax office (Kantor Pajak) with your passport and stay permit, or through an authorized representative.
While not technically mandatory by law, a local Indonesian bank account is practically essential for completing a property purchase in Indonesia because it facilitates the transfer of funds, payment of taxes and fees, ongoing utility payments, and meets anti-money laundering compliance requirements.
Foreign buyers in Indonesia typically need to provide proof of funds documentation showing the legitimate source of purchase money, and while a local address is not strictly required at the time of purchase, you will need to provide a correspondence address for official property documents and tax notices.
We have a whole section dedicated to all the documents you need in our Indonesia property pack.
Can a foreign-owned company buy property in Indonesia?
A foreign-owned company (PT PMA) can purchase property in Indonesia, but this structure is primarily designed for commercial property and business purposes rather than as a straightforward vehicle for individual residential property ownership.
While some Americans do use PT PMA structures to hold property in Indonesia, this approach involves significant setup costs, ongoing compliance requirements, minimum capital requirements, and active business operations, making it more suitable for investors with multiple properties or commercial ventures rather than a single home purchase.
Owning property through a company structure in Indonesia does not automatically lower taxes and can actually increase costs because a PT PMA faces corporate tax obligations, annual reporting requirements, and administrative expenses that individual Hak Pakai ownership does not require.
The main drawback of using company ownership for residential property in Indonesia is the complexity and cost of maintaining the corporate structure, including mandatory capital requirements, annual audits, corporate tax filings, and the risk of losing the property if the company fails to meet ongoing compliance obligations.
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What taxes and fees will I pay in Indonesia in 2026?
What are buyer taxes in Indonesia in 2026?
As of early 2026, the total buyer tax on a property purchase in Indonesia is approximately 5% of the transaction value, paid as BPHTB (property acquisition duty), which on a typical IDR 5 billion property (approximately $300,000 or €250,000) would amount to around IDR 247 million ($14,700 or €12,400) after the non-taxable threshold deduction.
The main tax component for buyers is the BPHTB calculated at 5% of the property value minus a small non-taxable threshold (NPOPTKP) that varies by region, typically ranging from IDR 60 million to IDR 100 million depending on the location.
The buyer tax rates in Indonesia are the same for foreigners and locals, and there is no distinction between primary residences and investment properties for BPHTB purposes, though new properties purchased from registered developers may also be subject to 11% VAT which does not apply to resales between individuals.
If you want to go into more details, we also have a page detailing all the property taxes and fees in Indonesia.
What are other closing costs in Indonesia in 2026?
As of early 2026, buyers in Indonesia should budget approximately 1.5% to 3% of the purchase price for closing costs excluding taxes, which on a typical IDR 5 billion property (approximately $300,000 or €250,000) translates to IDR 75-150 million ($4,500-$9,000 or €3,750-€7,500).
The main closing cost categories include notary and PPAT (land deed official) fees at around 1-1.5% of the property value (IDR 50-75 million on a IDR 5 billion property, or $3,000-$4,500 / €2,500-€3,750), land office registration fees at around IDR 5-10 million ($300-$600 or €250-€500), and bank-related fees if using a mortgage including appraisal at IDR 500,000-3 million ($30-$180 or €25-€150).
Agent commissions in Indonesia are often negotiable and sometimes paid by the seller, while notary fees can vary slightly between practitioners, giving buyers some room to shop around for competitive rates.
The closing cost that tends to surprise foreign buyers the most in Indonesia is the currency conversion spread and international wire transfer fees, which can add 2-3% to the effective cost if you are bringing money from abroad without careful planning.
Are there hidden fees foreigners miss in Indonesia right now?
Foreign buyers commonly overlook fees totaling IDR 50-150 million (approximately $3,000-$9,000 or €2,500-€7,500) beyond the standard taxes and closing costs, primarily related to currency exchange, property due diligence, and first-year setup costs.
The top three hidden or unexpected fees foreign buyers most often fail to budget for in Indonesia include minimum property price compliance (properties below the threshold are simply ineligible for foreign purchase), currency exchange spreads of 2-3% when transferring funds internationally (IDR 100-150 million on a IDR 5 billion property), and legal due diligence costs of IDR 10-25 million ($600-$1,500 or €500-€1,250) to verify title authenticity and ownership history.
Ongoing annual costs foreign property owners often underestimate after purchase in Indonesia include the annual property tax (PBB) at around 0.1-0.3% of assessed value (IDR 5-15 million annually, or $300-$900 / €250-€750), apartment service charges and sinking funds for strata properties (IDR 1-3 million monthly, or $60-$180 / €50-€150), and property management fees if you are not resident in Indonesia.
Getting surprised by hidden fees is one of the pitfalls people face when buying real estate in Indonesia.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Indonesia versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
Can I get a mortgage as a US citizen in Indonesia in 2026?
Do banks lend to US citizens in Indonesia in 2026?
As of early 2026, mortgage financing is available to US citizens from Indonesian banks, but only under specific conditions that typically require having a valid stay permit (KITAS or KITAP) and demonstrable income within Indonesia.
US citizens generally receive similar treatment to other foreign nationals when applying for mortgages in Indonesia, as banks evaluate foreigners based on residency status and income documentation rather than specific nationality.
The main reason some Indonesian banks are hesitant to lend to American borrowers specifically is the FATCA (Foreign Account Tax Compliance Act) reporting requirements, which create additional compliance burden for banks and may lead some smaller institutions to avoid US clients entirely.
The typical approval rate for US citizens applying for property loans in Indonesia is lower than for Indonesian citizens, with success depending heavily on having a stable long-term visa, documented local income, and choosing a bank with established foreigner lending programs.
There is a full document dedicated to mortgage for foreigners in our pack covering the property buying process in Indonesia.
What down payment do American people need in Indonesia in 2026?
As of early 2026, the estimated minimum down payment for US citizens to obtain a mortgage in Indonesia is typically 30-35% of the property value, which on a typical IDR 5 billion property (approximately $300,000 or €250,000) means preparing at least IDR 1.5-1.75 billion ($90,000-$105,000 or €75,000-€87,500) upfront.
The typical down payment range for foreign buyers in Indonesia spans from 30% at the minimum to 50% for more conservative lenders or higher-risk profiles, with 35% being a sensible planning baseline for most American buyers.
A larger down payment does improve mortgage terms for US citizens in Indonesia, as banks view higher equity as reduced risk and may offer slightly better interest rates, longer tenures, and faster approval processes when you bring more capital to the table.
What interest rates do US citizens get in Indonesia in 2026?
As of early 2026, the typical mortgage interest rate range for US citizens in Indonesia is between 8% and 11% annually, with Bank Indonesia's policy rate at 4.75% serving as the benchmark that anchors all lending rates in the economy.
Interest rates for foreign buyers in Indonesia are generally similar to or slightly higher than rates offered to local residents, with the difference typically coming from shorter maximum tenures and higher down payment requirements rather than the headline rate itself.
Indonesian banks commonly offer both fixed-rate promotional periods (often 1-3 years at rates in the low single digits) followed by floating rates, with most foreign buyers ending up on floating rate mortgages that can reach around 11% based on current bank rate sheets from institutions like BCA.
The single factor that has the biggest impact on the interest rate a US citizen will be offered in Indonesia is the strength and documentability of their income, as banks reward borrowers who can clearly demonstrate stable, verifiable earnings with better rates and terms.
Can I use US income to qualify in Indonesia right now?
US-sourced income can sometimes be used for mortgage qualification in Indonesia, but banks strongly prefer locally earned income and will apply stricter underwriting standards, higher down payment requirements, and additional documentation when evaluating foreign income.
Indonesian banks typically require American applicants using US income to provide 2-3 years of tax returns, bank statements showing regular deposits, employment verification letters, and potentially notarized translations of all documents into Indonesian.
Alternative income verification methods accepted by some Indonesian banks when standard US documentation is insufficient include demonstrating substantial liquid assets in Indonesian accounts, providing rental income documentation from Indonesian properties, or showing business income from an Indonesian-registered company.
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How do US taxes interact with owning property in Indonesia?
Do I have to declare the property to the IRS from Indonesia?
Simply owning foreign real estate in Indonesia does not automatically create a special IRS reporting requirement, as directly owned foreign property is generally not considered a "specified foreign financial asset" under Form 8938 (FATCA) rules.
The specific IRS forms that may apply to US citizens owning property in Indonesia depend on how the property is used, with rental income reported on Schedule E of Form 1040, capital gains from a sale reported on Schedule D, and any foreign bank accounts used for property transactions potentially requiring FBAR (FinCEN 114) filing if balances exceed $10,000.
US reporting obligations are triggered not by simply owning property but by the income or transactions associated with it, meaning rental income, property sales, and foreign financial accounts connected to the property all have separate reporting requirements.
Will I pay tax twice in the US and Indonesia in 2026?
As of early 2026, there is a real risk of paying tax twice on Indonesia property income, though mechanisms exist to reduce or eliminate double taxation for US citizens who properly structure their tax filings.
The United States and Indonesia do have an income tax treaty in force (Treaty Doc 100-22), which provides certain protections for property owners including provisions for avoiding double taxation on income like rental earnings, though the treaty has some limitations that reduce its effectiveness for Americans.
The Foreign Tax Credit (Form 1116) allows US citizens to offset Indonesian taxes paid against their US tax liability dollar-for-dollar up to the US tax owed on that income, effectively ensuring you pay the higher of the two countries' rates rather than both rates combined.
Whether property taxes paid in Indonesia are deductible on US federal tax returns depends on how the property is used, with taxes on rental properties generally deductible as a business expense while taxes on personal-use properties fall under the $10,000 SALT (State and Local Tax) deduction cap and may provide limited or no benefit.
Do I need FATCA reporting when buying in Indonesia?
FATCA reporting (Form 8938) is generally not triggered by the property purchase itself, as directly owned foreign real estate is typically excluded from the definition of specified foreign financial assets that require disclosure.
The specific FATCA thresholds that trigger reporting obligations relate to foreign financial accounts and certain foreign financial assets, not the property deed, but if you open Indonesian bank accounts for mortgage payments or rent collection and those accounts exceed $50,000 at year-end (or $75,000 at any time for single filers living in the US), Form 8938 filing becomes required.
FATCA reporting (Form 8938) differs from FBAR (FinCEN 114) in that FATCA covers a broader range of foreign financial assets with higher thresholds and is filed with your tax return, while FBAR specifically covers foreign bank and financial accounts with a $10,000 threshold and is filed separately with FinCEN.
Consulting a US CPA before buying property in Indonesia is strongly recommended, and you should specifically ask about your FBAR and FATCA obligations for any Indonesian bank accounts, the tax treatment of rental income and how to claim Foreign Tax Credits, depreciation rules for foreign rental property, and exit tax planning if you plan to sell the property in the future.
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Indonesia. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
What sources have we used to write this blog article?
Whether it's in our blog articles or the market analyses included in our property pack about Indonesia, we always rely on the strongest methodology we can ... and we don't throw out numbers at random.
We also aim to be fully transparent, so below we've listed the authoritative sources we used, and explained how we used them and the methods behind our estimates.
| Source Name | Why It's Authoritative | How We Used It |
|---|---|---|
| Government Regulation (PP) No. 18/2021 | Official Indonesian government regulation on land and strata rights for foreigners | We used it as the primary legal reference for what foreigners can own. We cross-checked all ownership pathway descriptions against this binding regulation. |
| Basic Agrarian Law (UU No. 5/1960) | Indonesia's foundational land law that defines ownership types | We used it to explain why freehold is reserved for citizens. We mapped modern foreign pathways back to this core legal framework. |
| Kepmen ATR/BPN 1241/2022 | Official decree setting minimum property prices for foreign buyers by province | We used it to provide accurate minimum price thresholds. We validated the price bands against secondary market sources. |
| DJP (Directorate General of Taxes) | Indonesia's official tax authority explaining property transaction taxes | We used it to define buyer versus seller tax obligations. We anchored our BPHTB and income tax explanations on this official source. |
| Bank Indonesia | Indonesia's central bank setting benchmark interest rates | We used their policy rate announcements to anchor mortgage rate expectations. We triangulated with actual bank rate sheets for accuracy. |
| BCA Mortgage Rate Sheet | Major Indonesian bank publishing actual mortgage pricing and terms | We used it to show real borrower rates rather than theoretical ranges. We treated it as a market datapoint for current lending conditions. |
| IRS Form 8938 Guidance | Official IRS resource explaining foreign asset reporting requirements | We used it to clarify common misconceptions about FATCA and real estate. We ensured our reporting guidance matched current IRS positions. |
| IRS Indonesia Tax Treaty Documents | Official US government repository for treaty texts | We used it to confirm the US-Indonesia treaty exists and its scope. We cross-referenced with Congress.gov for additional verification. |
| UNCTAD Investment Policy Monitor | UN body tracking global investment policy measures neutrally | We used it as an independent verification of Indonesia's foreign ownership reforms. We kept legal details anchored to Indonesian regulations. |
| Tranio Indonesia Mortgage Guide | Established international property platform with detailed mortgage analysis | We used it to validate foreigner mortgage eligibility requirements. We cross-referenced their KITAS/KITAP requirements with bank documentation. |
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