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
Buying property in Medan as a foreigner involves specific legal structures, minimum price thresholds, and paperwork requirements that differ significantly from what Indonesian citizens face.
This guide covers what you can legally own, what visa status you need, how the buying process works step by step, and what taxes and fees to expect in 2026.
We constantly update this blog post to reflect the latest regulations and market conditions in Medan's residential property market.
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 Medan.
Insights
- Foreign buyers in Medan must spend at least IDR 2 billion (around USD 125,000) on a landed house, which is the minimum price threshold set specifically for North Sumatra province.
- Foreigners cannot hold freehold land title (Hak Milik) in their own name in Medan, but they can register a Hak Pakai (right to use) title that provides legal protection for up to 30 years with extensions.
- The most common ownership mistake in Medan involves using nominee structures where an Indonesian friend or spouse holds the title, which creates serious legal risks if the relationship changes.
- Annual property tax in Medan for a home valued between IDR 1.5 billion and IDR 3 billion typically runs between IDR 1.5 million and IDR 5 million per year, thanks to tiered rates ranging from 0.125% to 0.280%.
- Mortgage rates for foreigners in Medan in 2026 typically start around 5% to 8% during promotional periods but jump to 10.5% to 14% once the introductory rate expires.
- Buyer closing costs in Medan usually total 6% to 8% of the purchase price, with the acquisition duty (BPHTB) alone accounting for roughly 5% of that amount.
- Indonesia's Second Home visa offers foreigners a 5 or 10 year stay permit, but buying property alone does not automatically grant residency or citizenship.
- Popular residential areas for foreigners in Medan include Medan Polonia for luxury houses, Setia Budi for gated communities, and Cemara Asri for large planned developments in the metro area.
What can I legally buy and truly own as a foreigner in Medan?
What property types can foreigners legally buy in Medan right now?
In January 2026, foreigners can legally buy landed houses, apartments, and townhouses in Medan, but only through specific legal structures like Hak Pakai (right to use) rather than full freehold ownership.
The most important legal condition is that North Sumatra province requires foreign buyers to purchase landed houses worth at least IDR 2 billion (roughly USD 125,000), which limits options to mid-range and higher properties in Medan.
For apartments and condos in Medan, the minimum price threshold may differ, so you should confirm the exact category with your notary or PPAT because the building's legal structure and developer paperwork also affect your eligibility.
Your immigration status matters too, because even though post-2021 rules are more flexible than before, your notary and the land office will still require clean immigration documentation to process the registration.
Finally, please note that our pack about the property market in Medan is specifically tailored to foreigners.
Can I own land in my own name in Medan right now?
No, foreigners cannot hold freehold land title (called Hak Milik or SHM) in their own name in Medan as of January 2026, which is a fundamental rule across all of Indonesia.
However, you can legally hold a Hak Pakai (right to use) title that gets registered in your name at the land office, and while this is not the same as freehold, it is a recognized and enforceable property right under Indonesian law.
These Hak Pakai rights typically come with defined time periods, often structured as 30 years with options for extension and renewal under the PP 18/2021 framework, so it is important to understand the timeline before you buy.
As of 2026, what other key foreign-ownership rules or limits should I know in Medan?
As of January 2026, the main additional rule affecting purchases in Medan is that your property registration depends heavily on the building's legal paperwork, especially for apartments where the developer's land rights, permits, and strata documentation must all be in order before you can register your ownership.
There is no specific foreign ownership quota for apartments in Medan like you might find in some other countries, but the building itself must meet certain regulatory requirements for a foreign buyer to be eligible to purchase a unit.
Foreign buyers in Medan must work through a PPAT (land deed official) who will handle the registration with the local land office (BPN), and this process requires your immigration documents, tax ID, and various property verification documents.
The most notable recent change came with PP 18/2021, which modernized the land rights framework and made the rules somewhat clearer for foreigners, though the core restriction against freehold ownership remains unchanged.
What's the biggest ownership mistake foreigners make in Medan right now?
The biggest mistake foreigners make in Medan is using a nominee structure where an Indonesian friend, spouse, or company holds the freehold title (SHM) on paper while the foreigner has only a side agreement claiming beneficial ownership.
If you use this arrangement and the relationship sours, the nominee dies, or a legal dispute arises, you may find yourself with no enforceable claim to the property because Indonesian law recognizes the registered owner, not your private agreement.
Other classic pitfalls in Medan include buying a property without verifying the title status at the land office, skipping proper due diligence on apartment buildings where the developer's paperwork is incomplete, and relying on verbal promises instead of notarized documents during the deposit stage.
We have made this infographic to give you a quick and clear snapshot of the property market in Indonesia. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
Which visa or residency status changes what I can do in Medan?
Do I need a specific visa to buy property in Medan right now?
In January 2026, you do not need a special "property buyer visa" to purchase in Medan, but you do need valid immigration documentation that your notary, PPAT, and the land office will accept, and buying while on a short tourist visa can be operationally difficult even if technically allowed.
The most common administrative blocker for buyers without local residency is opening an Indonesian bank account, which usually requires a longer-term stay permit like KITAS or KITAP, and this matters because you will need a local account for deposits, tax payments, and closing.
You will typically need an NPWP (Indonesian tax ID) at some point during the purchase, and the tax authority requires foreigners to register using their KITAS or KITAP documentation, so getting your immigration status sorted early makes everything smoother.
A typical foreign buyer in Medan must present their passport, valid visa or stay permit, NPWP tax ID, and various translated and notarized documents to complete the purchase and registration process.
Does buying property help me get residency and citizenship in Medan in 2026?
As of January 2026, buying property in Medan does not automatically give you residency or a path to Indonesian citizenship, because immigration status is governed by visa categories that are separate from property ownership rules.
Indonesia does offer a Second Home visa that grants 5 or 10 years of stay permission, but this is a standalone visa product that you apply for through the immigration office, not something triggered by buying a house.
Other pathways to longer-term residency include work permits (KITAS), retirement visas for those over 55, and investor visas, while citizenship requires marriage to an Indonesian citizen or a lengthy naturalization process that has nothing to do with property ownership.
We give you all the details you need about the different pathways to get residency and citizenship in Medan here.
Can I legally rent out property on my visa in Medan right now?
Your visa status does not directly prevent you from renting out property you legally own in Medan, but the conditions attached to your specific property right and how it is registered can affect what is advisable.
You do not need to live in Indonesia to rent out your Medan property, and many foreign owners manage rentals through local agents, though you will face practical constraints around bank account access, tax withholding, and tenant enforcement from abroad.
Rental income from land and buildings in Indonesia is subject to a final tax under PP 34/2017, which typically means tax is withheld at source or paid on your rental receipts, and foreign owners should work with a tax advisor to ensure proper compliance and filing.
We cover everything there is to know about buying and renting out in Medan here.
Get fresh and reliable information about the market in Medan
Don't base significant investment decisions on outdated data. Get updated and accurate information with our guide.
How does the buying process actually work step-by-step in Medan?
What are the exact steps to buy property in Medan right now?
The standard sequence in Medan starts with selecting a property and immediately confirming the title type can work for foreign ownership, then running pre-checks on the seller and certificate, signing a preliminary agreement with deposit, paying transfer taxes, executing the transfer deed (AJB) before a PPAT, and finally registering your right at the land office (BPN).
You should ideally be physically present for the deed signing and bank-related steps, but many foreign buyers use a properly notarized power of attorney when they cannot attend, though whether this goes smoothly depends on your specific bank and PPAT.
The deal becomes legally binding when you sign the preliminary sale agreement with deposit before the PPAT, because this document creates enforceable obligations for both parties even before the final transfer deed is executed.
From accepted offer to final registration in Medan, expect the process to take anywhere from 2 to 4 months depending on how quickly paperwork clears, whether the seller has all documents ready, and how busy the local land office is.
We have a document entirely dedicated to the whole buying process our pack about properties in Medan.
Is it mandatory to get a lawyer or a notary to buy a property in Medan right now?
A PPAT (land deed official, who is often also a notary) is effectively mandatory in Medan because the property transfer requires an authentic deed and formal registration that only a PPAT can execute and file with the land office.
The key difference is that a PPAT or notary creates the official documents and handles registration, while an independent lawyer reviews the transaction from your perspective, checks for hidden risks, and advises you on structuring, which is optional but highly recommended for complex deals.
Your PPAT engagement should explicitly include running a title check at BPN, verifying the seller's identity and authority to sell, preparing all tax calculations, and handling the full registration process through to receiving your certificate.
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.
What checks should I run so I don't buy a problem property in Medan?
How do I verify title and ownership history in Medan right now?
The official authority for verifying title and ownership history in Medan is the local land office (Badan Pertanahan Nasional or BPN), and your PPAT should run a formal title check there as a standard part of due diligence.
You should request the land certificate (Sertifikat Hak Atas Tanah) which shows the registered owner, the type of right, the land boundaries, and whether it matches the physical property you are buying.
In Medan, buyers commonly look back 10 to 15 years on ownership history, especially for older properties in prime neighborhoods like Medan Polonia or Medan Baru where multiple family transfers over generations can create complicated chains.
A clear red flag that should stop or pause your purchase is any discrepancy between the certificate holder and the seller, unresolved inheritance claims, or boundaries that do not match the actual property you inspected.
You will find here the list of classic mistakes people make when buying a property in Medan.
How do I confirm there are no liens in Medan right now?
The standard way to confirm there are no liens or encumbrances on a property in Medan is to have your PPAT request a formal encumbrance check (pengecekan sertifikat) from the land office, which shows whether any security rights or other burdens are registered against the title.
The most common type of lien to ask about in Medan is a mortgage or security right (Hak Tanggungan) from a bank loan, which would be registered against the certificate and must be cleared before the property can transfer cleanly to you.
The best proof of lien status is a formal letter from BPN confirming the certificate is free and clear, which your PPAT can obtain as part of the standard pre-transfer verification process.
How do I check zoning and permitted use in Medan right now?
To check zoning and permitted use in Medan, you should contact the local planning authority (Dinas Tata Ruang) or the city's one-stop licensing office, because zoning classification is separate from your land title and determines what you can legally do with the property.
The key document is the city's spatial plan map (Rencana Tata Ruang Wilayah) which shows whether your property sits in a residential, commercial, or mixed-use zone, and you can also check the building permit (IMB or PBG) to see what the existing structure is officially approved for.
A common pitfall foreign buyers miss in Medan is purchasing a "residential-feeling" property on a street that is rapidly commercializing, only to discover the zoning has changed or the permitted use does not match their plans for renovation or rental.
Buying real estate in Medan can be risky
An increasing number of foreign investors are showing interest. However, 90% of them will make mistakes. Avoid the pitfalls with our comprehensive guide.
Can I get a mortgage as a foreigner in Medan, and on what terms?
Do banks lend to foreigners for homes in Medan in 2026?
As of January 2026, yes, some Indonesian banks do lend to foreigners for home purchases in Medan, but approval is selective and usually requires a strong local presence such as a longer-term stay permit, verifiable income in Indonesia, and clean documentation.
Foreign borrowers in Medan can typically expect loan-to-value ratios between 50% and 70%, which means you will need to bring at least 30% to 50% of the property price as a down payment, compared to the 80% or higher LTV that Indonesian citizens might receive.
The most common eligibility requirement that determines whether a foreigner qualifies is having a valid KITAS or KITAP stay permit combined with proof of stable income, ideally from Indonesian employment or a business operating in the country.
You can also read our latest update about mortgage and interest rates in Indonesia.
Which banks are most foreigner-friendly in Medan in 2026?
As of January 2026, the most foreigner-friendly banks for mortgages in Medan tend to be BTN (Bank Tabungan Negara) which specializes in housing finance, along with large national banks like BCA and Bank Mandiri that have established expatriate services and branches in Medan.
What makes these banks more foreigner-friendly is that they have dedicated mortgage products for expatriates, staff experienced with foreign documentation, and clearer underwriting processes for non-citizen borrowers compared to smaller regional banks.
However, most of these banks still require local residency status (KITAS or KITAP) to lend, so true non-residents who do not live in Indonesia will find it very difficult to get mortgage financing and typically need to buy with cash.
We actually have a specific document about how to get a mortgage as a foreigner in our pack covering real estate in Medan.
What mortgage rates are foreigners offered in Medan in 2026?
As of January 2026, foreigners in Medan can expect mortgage rates starting around 5% to 8% during promotional fixed-rate periods, but once the introductory period ends (usually 1 to 3 years), rates typically jump to 10.5% to 14% on a floating basis.
Fixed-rate periods are usually cheaper upfront but short-lived, while variable rates after the promo period follow market conditions and tend to sit several percentage points above Bank Indonesia's benchmark rate of around 4.75%, which explains why double-digit rates are normal for retail mortgages in Indonesia.
We made this infographic to show you how property prices in Indonesia compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
What will taxes, fees, and ongoing costs look like in Medan?
What are the total closing costs as a percent in Medan in 2026?
In Medan in 2026, foreign buyers should budget roughly 7% of the purchase price for total closing costs, which covers all the taxes, fees, and administrative expenses you will pay to complete the transaction.
The realistic range for most standard transactions is 6% to 8%, with variation depending on property price, whether you are buying new or resale, and how complex the paperwork turns out to be.
The specific fee categories that make up closing costs in Medan include BPHTB (the acquisition duty), notary and PPAT fees, land office registration fees, document translation and legalization costs, and potentially VAT if buying a new unit from a developer.
The single biggest contributor to closing costs is BPHTB, which is typically around 5% of the taxable value after subtracting the local non-taxable threshold, making it by far the largest line item for buyers.
If you want to go into more details, we also have a blog article detailing all the property taxes and fees in Medan.
What annual property tax should I budget in Medan in 2026?
As of January 2026, a typical owner-occupied home in Medan with a market value between IDR 1.5 billion and IDR 3 billion should budget around IDR 1.5 million to IDR 5 million per year (roughly USD 95 to USD 315, or EUR 85 to EUR 290) for annual property tax (PBB-P2).
Annual property tax in Medan is assessed using tiered rates applied to the NJOP (assessed value set by the government) rather than market value, with rates ranging from 0.125% to 0.280% depending on which value bracket your property falls into, and a non-taxable amount of IDR 20 million is subtracted before calculation.
How is rental income taxed for foreigners in Medan in 2026?
As of January 2026, rental income from property in Medan is subject to a final tax under PP 34/2017, which typically means the tax is calculated as a flat percentage of gross rent received rather than allowing deductions for expenses.
Foreign owners usually see the tax either withheld by the tenant (if the tenant is a company or institution) or must pay it themselves when filing, and working with a local tax advisor is important to ensure you meet reporting requirements and take advantage of any applicable tax treaty benefits.
What insurance is common and how much in Medan in 2026?
As of January 2026, a standard home insurance policy in Medan covering fire and extended perils typically costs between 0.10% and 0.30% of the insured value per year, so for a property insured at IDR 2 billion, expect to pay around IDR 2 million to IDR 6 million annually (roughly USD 125 to USD 375, or EUR 115 to EUR 345).
The most common coverage that homeowners carry in Medan is property or building insurance covering fire and extended perils, with contents insurance being particularly popular for apartment owners.
The biggest factor that makes insurance premiums higher or lower for the same property type in Medan is whether you add earthquake coverage, since Indonesia is a high seismic risk country and this optional add-on can significantly increase your annual premium.
Get the full checklist for your due diligence in Medan
Don't repeat the same mistakes others have made before you. Make sure everything is in order before signing your sales contract.
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 Medan, 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 | Why it's authoritative | How we used it |
|---|---|---|
| PP 18/2021 (BPK Database) | Core national regulation setting Indonesia's current land rights framework. | We used it to define which land and title rights foreigners can hold in Medan. We cross-checked media summaries against this official text. |
| Official Law Portal (peraturan.go.id) | Government's official portal for published regulations and legal texts. | We used it as a second anchor for PP 18/2021. We verified wording when secondary sources disagreed. |
| detikProperti | Major national outlet explicitly citing the decree with province-by-province thresholds. | We extracted North Sumatra's IDR 2 billion minimum price for landed houses. We treated it as a bridge source to the official decree. |
| Medan Perda 1/2024 | Official city regulation for local property taxes in Medan. | We used it to get Medan's PBB-P2 tax brackets and non-taxable threshold. We produced realistic annual tax estimates based on these rates. |
| Medan Revenue Office (Bapenda) | City's official revenue and tax office website. | We confirmed Perda 1/2024 is the active regulation for property tax. We used it to verify the same rules found in the PDF. |
| DJP (PP 34/2017 on Rental Tax) | National tax authority's official regulation library. | We used it to define how rental income from property is taxed. We explained the final tax framework for foreign owners. |
| DJP (PP 34/2016 on Transfer Tax) | Official DJP-hosted PDF of property transfer tax rules. | We used it to explain seller-side income tax on transfers. We built closing cost expectations based on this regulation. |
| DJP VAT Guidance 2025 | Tax authority communication on how VAT rules apply in practice. | We used it to describe VAT treatment for new-build transactions. We combined it with resale logic to estimate when VAT applies. |
| DJP NPWP Requirements | Tax authority's official checklist for tax ID registration. | We answered whether foreigners need a local tax ID. We kept paperwork requirements simple and actionable. |
| Immigration Office (Second Home Circular) | Official immigration publication of the Second Home visa framework. | We described what Second Home stay permission is and its duration. We avoided relying on unofficial visa summaries. |
| Immigration Office (Molina Portal) | Official post describing the real visa application channel. | We pointed to the practical application route for Second Home visa. We kept the visa section concrete rather than theoretical. |
| Indonesia Notary Law | Binding law defining notary authority for authentic deeds. | We explained why PPAT involvement is mandatory for transfers. We used it to distinguish notary and lawyer roles. |
| Reuters (Bank Indonesia Rate) | Globally recognized wire service reporting central bank decisions. | We used it as macro context for mortgage rate pricing. We explained why double-digit retail rates remain normal in Indonesia. |
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.
Related blog posts