Buying real estate in Jakarta?

We've created a guide to help you avoid pitfalls, save time, and make the best long-term investment possible.

What is the process to buy an apartment in Jakarta?

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Authored by the expert who managed and guided the team behind the Indonesia Property Pack

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Yes, the analysis of Jakarta's property market is included in our pack

If you're reading this, it's likely that Jakarta has caught your eye, and you're thinking about investing in an apartment there.

But what does the buying process entail? Is it straightforward or filled with hurdles? How long should you expect it to take? What challenges might you face along the way?

In this article, we'll walk you through each step of the journey.

Actually, we know this market inside and out. We keep tabs on it regularly, and all our discoveries are reflected in the most recent version of the Indonesia Property Pack

The Steps to Buy a Condo in Jakarta

  • 1) Understand Foreign Ownership Regulations

    - Foreigners can only purchase property under the "Right to Use" (Hak Pakai) title.
    - The property must be above a certain price threshold, which varies depending on the region in Jakarta.
    - Ensure the condo is not part of a government-subsidized housing project, as these are not available for foreign ownership.

  • 2) Engage a Reputable Real Estate Agent

    - Choose an agent experienced with foreign buyers and familiar with Jakarta's property market.
    - Verify the agent's credentials and track record to avoid scams.
    - Discuss your budget, preferred locations, and specific requirements with the agent.

  • 3) Conduct Due Diligence

    - Verify the legal status of the condo and ensure it has the necessary permits and licenses.
    - Check for any outstanding debts or encumbrances on the property.
    - Review the condo's management and maintenance fees, as these can vary significantly.

  • 4) Secure Financing

    - Determine if you will finance the purchase through a local bank or international financing.
    - Be aware that Indonesian banks may have restrictions on lending to foreigners.
    - Prepare necessary documentation, such as proof of income and identification.

  • 5) Negotiate and Make an Offer

    - Work with your agent to negotiate the best price and terms for the condo.
    - Consider including contingencies in your offer, such as a satisfactory inspection.
    - Be prepared to pay a deposit, typically around 10% of the purchase price, upon acceptance.

  • 6) Finalize the Purchase

    - Engage a notary (PPAT) to handle the legal transfer of the property title.
    - Pay the remaining balance and any applicable taxes, such as the Land and Building Acquisition Duty (BPHTB).
    - Ensure the "Right to Use" title is properly registered in your name.

  • 7) Post-Purchase Considerations

    - Familiarize yourself with the condo's rules and regulations, including any restrictions on renting.
    - Set up utilities and services, such as electricity, water, and internet.
    - Consider hiring a property management company if you plan to rent out the condo.

Get the full checklist for your due diligence in Indonesia

Don't repeat the same mistakes others have made before you. Make sure everything is in order before signing your sales contract.

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What You Need to Know Before Buying an Apartment in Jakarta

What are the legal requirements for foreigners buying property in Jakarta?

Foreigners can purchase apartments in Jakarta under the "Right to Use" (Hak Pakai) title, which allows ownership for a specific period.

The property must be above a certain price threshold, which is currently set at IDR 3 billion for apartments.

Buyers must also obtain a permit from the Indonesian Investment Coordinating Board (BKPM) to proceed with the purchase.

How much should I expect to pay per square meter for an apartment in Jakarta?

The price per square meter for an apartment in Jakarta varies significantly depending on the location and type of property.

In central areas like Sudirman or Kuningan, prices can range from IDR 30 million to IDR 60 million per square meter.

In more suburban areas, prices may be lower, ranging from IDR 15 million to IDR 25 million per square meter.

What are the additional costs involved in purchasing an apartment?

In addition to the purchase price, buyers should budget for taxes, legal fees, and notary fees, which can add up to 10% to 15% of the property's value.

There is also a transfer tax, known as BPHTB, which is 5% of the property's sale price.

Buyers may also need to pay for a property agent's commission, typically around 2% to 3% of the sale price.

How long does the buying process typically take?

The process of buying an apartment in Jakarta can take anywhere from three to six months, depending on various factors.

This timeline includes property search, negotiation, legal checks, and finalizing the sale.

Delays can occur due to legal paperwork or if the buyer is obtaining a mortgage.

What financing options are available for purchasing an apartment?

Local banks in Indonesia offer mortgage loans to both residents and foreigners, although terms may vary.

Foreigners typically need to provide a larger down payment, often around 30% to 50% of the property's value.

Interest rates for mortgages in Indonesia can range from 7% to 10% per annum.

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buying property foreigner Indonesia

What should I know about property taxes in Jakarta?

Property owners in Jakarta are required to pay an annual property tax, known as PBB, which is calculated based on the property's assessed value.

The tax rate is generally 0.5% of the assessed value, but this can vary depending on the property's location and size.

It's important to ensure that all property taxes are up to date before completing a purchase.

Are there any restrictions on renting out my apartment after purchase?

Foreigners who own apartments under the "Right to Use" title can rent out their property, but they must comply with local regulations.

It's advisable to work with a local property management company to handle rentals and ensure compliance with Indonesian laws.

Rental income is subject to tax, and owners must report this income to the Indonesian tax authorities.

What is the average rental yield for apartments in Jakarta?

The rental yield for apartments in Jakarta can vary based on location and property type.

In prime areas, rental yields typically range from 5% to 7% per annum.

In less central areas, yields may be slightly lower, around 3% to 5% per annum.

How can I verify the legitimacy of a property developer in Jakarta?

To verify a property developer's legitimacy, check their registration with the Indonesian Real Estate Association (REI) and their track record of completed projects.

It's also advisable to visit previous developments and speak with current residents to gauge the quality and reliability of the developer.

Engaging a local legal advisor can help ensure that all necessary due diligence is conducted before purchasing.

What are the common types of apartment ownership titles in Jakarta?

In Jakarta, the most common types of apartment ownership titles are "Strata Title" and "Right to Use" (Hak Pakai).

Strata Title provides full ownership rights, while Right to Use is more common for foreign buyers and offers limited ownership rights.

Understanding the differences between these titles is crucial for making an informed purchase decision.

What amenities are typically included in Jakarta apartment complexes?

Many apartment complexes in Jakarta offer a range of amenities, including swimming pools, gyms, and 24-hour security.

Higher-end developments may also include additional features such as concierge services, children's play areas, and function rooms.

It's important to review the facilities offered by each complex to ensure they meet your lifestyle needs.

How does the location affect the value and desirability of an apartment in Jakarta?

Location is a key factor in determining the value and desirability of an apartment in Jakarta, with central areas commanding higher prices.

Proximity to business districts, public transportation, and amenities like shopping centers and schools can significantly enhance an apartment's appeal.

Investing in up-and-coming neighborhoods can offer potential for capital appreciation as infrastructure and development progress.