Bali — Wondering how to buy property in Bali as a foreigner? The dream of owning a villa in Bali has captivated thousands of international investors. But many quickly learn that navigating Indonesia’s land laws is not as simple as signing a contract and getting the keys. In this article, we summarize the key takeaways from a conversation with legal expert Ibu Sari, founder of Malekat Hukum. From legal structures to licensing challenges and tax risks, here’s everything you need to know to make a safe, compliant investment in Bali real estate.
How to Buy Property in Bali as a Foreigner: Legal Ownership Pathways
Foreigners cannot directly own freehold (Hak Milik) land in Indonesia. However, there are several legal alternatives:
PT PMA (Foreign-Owned Company)
Allows foreigners to acquire land under HGB (Right to Build) for commercial purposes.KITAS or KITAP (Residency Permits)
Eligible for a Hak Pakai (Right to Use) title, suitable for owning one residential property.Hak Sewa (Leasehold Agreements)
The most accessible option, often used when foreigners lack a legal company or residency. Not registered with the land office but still widely used.
“The first step is always due diligence,” says Ibu Sari. “You must verify zoning, ownership, and documentation before committing — ideally with a lawyer.”
Common Pitfalls in the Legal Landscape
Many foreign buyers are surprised to discover how easily things can go wrong when proper checks are skipped. Here are some common legal and cultural traps:
Zoning Misinformation: Sellers may mislabel land as “buildable” when it’s zoned as agricultural or sacred.
Unregistered Heirs: Land inherited without registration at the National Land Agency (BPN) creates ownership complications.
Nominee Structures: Using an Indonesian citizen to hold land on your behalf is illegal and extremely risky.
“We’ve seen fake IDs, unclear ownership chains, and green zone misrepresentations,” Ibu Sari shared. “Legal checks alone aren’t enough. You need cultural insight too.”
These risks highlight just how important it is to have proper legal and cultural guidance when navigating how to buy property in Bali as a foreigner.
Understanding Land Titles in Indonesia
For those researching how to buy property in Bali as a foreigner, it’s crucial to understand which titles are legally available — and which are not. There are four main land title types in Indonesia. Not all are accessible to foreigners, but understanding the differences is crucial:
| Title | Who Can Hold It | Duration | Use Case |
|---|---|---|---|
| Hak Milik | Indonesian citizens only | Unlimited | Full ownership — not available to foreigners |
| Hak Pakai | Foreigners with KITAS/KITAP | 30 years, extendable to 80 | Residential use, only 1 property, min IDR 5B value |
| HGB | PT PMA holders | 30 years, extendable to 80 | Commercial use via company |
| Hak Sewa | Anyone | 25–30 years typical | Unregistered lease agreements, popular with expats |
Understanding these legal differences is essential for anyone researching how to buy property in Bali as a foreigner in a safe and sustainable way.
Construction, Licensing & Rental Regulations
To legally build and operate a villa in Bali, a foreigner must understand these layers of regulation:
PKKPR: Confirms the land use matches your intended development.
PBG (formerly IMB): The building permit.
SLF: Issued after construction to certify the building is functional.
Pondok Wisata: Rental license for guesthouses, held only by an Indonesian citizen or a local PT.
“Foreigners who lease land must negotiate the Pondok Wisata license early,” advises Ibu Sari. “Without it, your rental operation won’t be legal.”
Cultural & Community Considerations
In Bali, owning property means becoming part of a local community. Legal ownership alone won’t protect you from social conflict.
Holy grounds: Some land is near temples or ceremonial paths, which can limit use.
Village councils (banjar): Must be informed and involved in land activity.
Full-moon ceremonies: Cultural events may pass through private land.
These factors are often overlooked when people focus purely on the legal side of how to buy property in Bali as a foreigner, but they’re just as important to long-term success.
“If you’re respectful and communicate clearly, you’ll avoid 99% of problems,” says Ibu Sari.
Taxes & Legal Obligations for Foreign Owners
Many foreigners who start with little legal research end up facing penalties or enforcement. That’s why understanding how to buy property in Bali as a foreigner legally can protect your investment long-term. Owning and renting property in Bali comes with strict tax and compliance obligations. Here’s what you need to watch:
| Requirement | Applies To | Penalties |
|---|---|---|
| Corporate Tax | PT PMA | Fines, license suspension |
| Rental Tax (10%) | Villa operators | Tax audits, back payments |
| Land & Building Tax (PBB) | All property owners | Legal blocks on transfer or sale |
| Lack of SLF or Licensing | All developments | Property sealing or demolition |
Final Advice: Invest Smart, Stay Legal
Buying or renting out property in Bali is achievable — but only for those who do it with legal clarity, cultural sensitivity, and professional help.
Full Interview Transcript
If you’d like to explore the full conversation between Jing and Ibu Sari, you can expand the section below to read the cleaned and formatted transcript. It’s a valuable resource for those who want a deeper look at Bali’s property laws from a legal expert’s point of view.
🗒️ Read the transcript
🎙️ Part 1: Introduction & Legal Pathways for Foreign Ownership
Jing: Today on the Bali Business Review, we’re joined by a special guest — someone who’s made a real impact in Bali’s property law space. She’s helped countless property owners navigate legal challenges with clarity.
Welcome to the show, Ibu Sari.
Ibu Sari: Thank you, Jing. It’s a pleasure to be here.
Jing: Can you start by introducing yourself to the audience — your background, the kind of work you do, and your experience in Bali’s real estate scene?
Ibu Sari: Sure. My name is Nilu Sari, and I’m from Canggu. I run a law firm called Malekat Hukum, which means “Angel of Justice.” We’re based in Canggu, with branches in Jakarta and Jogja. Law and property have been part of my life since childhood — my late father was an architect, and my mother is a law professor. I’ve seen Bali transform from rice fields to today’s vibrant property market. My mission is to help property owners — both local and foreign — navigate the legal landscape responsibly and fairly.
Jing: That’s amazing. Roughly how many clients would you say you’ve helped?
Ibu Sari: Directly and indirectly, I’d estimate in the hundreds.
Jing: And how long have you been practicing law?
Ibu Sari: I’ve been actively practicing for about three years, but together with my partners, we have decades of combined legal experience. One of our co-founders is Professor Retno, who teaches company law at a local university.
🏠 Part 2: Can Foreigners Own Land in Bali?
Jing: Let’s jump into it. What’s the legal process for a foreigner who wants to buy or build property in Bali?
Ibu Sari: The most important step is due diligence. Before you do anything, you must check the land certificate, zoning, ownership status, and verify everything — ideally with a lawyer. Foreigners cannot directly own freehold land in Indonesia. Instead, they have two main legal pathways: (1) Establish a PT PMA (foreign-owned company) (2) Use a KITAS or KITAP (temporary or permanent residency permit)
Jing: What’s a PT PMA?
Ibu Sari: It’s a foreign direct investment company, registered in Indonesia. Through this entity, you can legally acquire land under HGB (Hak Guna Bangunan) — the right-to-build title.
Jing: And a KITAS?
Ibu Sari: A KITAS is a limited stay permit. With a KITAS (or KITAP), you can apply for a Hak Pakai title — the right-to-use — for one residential property.
🔍 Part 3: Due Diligence & Cultural Integration
Jing: Can you share some stories from your due diligence experience? What surprises have you uncovered?
Ibu Sari: Plenty. One common issue is landowners misrepresenting zoning — claiming land is buildable when it’s actually in a green zone. We’ve also seen fake IDs and unclear ownership structures, where land is owned collectively but not legally registered.
Sometimes land was inherited decades ago but never officially recorded with the National Land Agency (BPN). This creates massive complications.
Jing: Sounds like legal checks aren’t enough — you also have to understand the culture?
Ibu Sari: Yes. Some land is located near holy areas, and cultural events like full-moon ceremonies may pass through the property. It’s vital to have a relationship with the local banjar (village council).
If you’re respectful and communicate clearly, you’ll avoid 99% of potential problems.
📜 Part 4: Land Title Types in Indonesia
Jing: Let’s break down the different types of land titles in Indonesia:
1.Hak Milik (Freehold)
Ibu Sari: Hak Milik is full ownership, only available to Indonesian citizens. It’s the most secure form of land ownership — but foreigners cannot legally hold it.
2. Hak Pakai (Right to Use)
Ibu Sari: Hak Pakai is available to foreigners with a KITAS or KITAP, for one residential property only. It can be held for 30 years, extendable to 80. Minimum property value in Bali: IDR 5 billion (subject to provincial rules).
3. HGB – Hak Guna Bangunan (Right to Build)
Ibu Sari: If you establish a PT PMA, you can acquire land under an HGB title. It allows you to build and operate properties for business purposes — like villas, hotels, or commercial buildings. Valid for 30 years, extendable to 80.
4. Hak Sewa (Leasehold)
Ibu Sari: Hak Sewa is a private lease agreement. It’s not registered with the land office, and it’s the most common option for foreigners without KITAS or PT PMA. Usually 25–30 years, renewable.
⚠️ Part 5: Nominee Structures
Jing: What about using an Indonesian nominee to buy land?
Ibu Sari: That’s illegal under Indonesian law and extremely risky. While some people still use nominee arrangements, the land remains under the Indonesian’s name. If anything goes wrong, you have no legal protection. We’ve helped restructure such arrangements into legal leases or PT PMA holdings when possible.
💍 Part 6: Buying Through a Spouse
Jing: What if a foreigner is married to an Indonesian citizen? Can they buy land under their spouse’s name?
Ibu Sari: Yes — but you must sign a prenuptial or postnuptial agreement that declares separation of assets. Without that, any property bought during the marriage is considered joint, and foreigners aren’t allowed to co-own land. Some couples also use a leaseback system — where the Indonesian spouse owns the land, and the foreign spouse leases it, ensuring long-term access.
🛏️ Part 7: Pondok Wisata & Rental Licensing
Jing: What’s a Pondok Wisata, and why is it so hard to get?
Ibu Sari: Pondok Wisata is a small accommodation license, like a mini hotel or guesthouse license. It can only be held by an Indonesian citizen or a locally-owned PT — not a PT PMA. So, if a foreigner leases land, the Indonesian landlord must apply for the license. This should be negotiated at the beginning of the lease agreement.
Jing: Is there a standard cost or timeframe?
Ibu Sari: Costs vary depending on zoning, land documents, and tax history. You should always verify zoning first to ensure the license is even possible.
🏗️ Part 8: PBG, SLF, and Building Compliance
Jing: The old IMB is no longer used, right?
Ibu Sari:
Correct. IMB was replaced by: (-) PBG (Persetujuan Bangunan Gedung) – building approval before construction (-) SLF (Sertifikat Laik Fungsi) – certificate of function after construction
Jing: So you need PBG to start building, and SLF to operate legally?
Ibu Sari: Exactly. The SLF ensures the building is safe, structurally sound, and fit for use. Without it, the property is considered illegal.
🗺️ Part 9: PKKPR and Land Use Approval
Jing: And before PBG, there’s something called PKKPR?
Ibu Sari: Yes — PKKPR (Persetujuan Kesesuaian Kegiatan Pemanfaatan Ruang) is a land use approval. It confirms that your planned building fits the local zoning and spatial plan. It’s done online now via the OSS RBA system, and is mandatory before applying for PBG.
💰 Part 10: Taxes & Reporting
Jing: What tax obligations should foreign property owners be aware of?
Ibu Sari: It depends on how you hold the property:
– PT PMA: Monthly and annual corporate tax filings are required.
– Villa rentals: Must pay income tax and local accommodation tax (around 10%)
– Land and building tax (PBB): Paid annually
Unpaid taxes can lead to fines, business license issues, or even property audits.
🚫 Part 11: Legal Enforcement
Jing: What happens if someone skips the legal process?
Ibu Sari: The government can: (1) Freeze the business (2) Seal the property (3) Impose fines (4) In extreme cases, demolish illegal buildings
Enforcement is stricter now, especially in tourism zones like Canggu and Ubud.
🎤 Part 12: Final Advice
Jing: What’s your advice for anyone planning to invest in Bali?
Ibu Sari: Do proper due diligence. Work with legal and cultural experts. Don’t treat Bali as just a business opportunity — it’s a place with rich traditions. If you respect the law and the culture, the community will welcome you, and your investment will thrive.
Jing: Thank you so much, Ibu Sari. This has been incredibly insightful.
Ibu Sari: Thank you, Jing. I’m honored to be part of this conversation.
🗒️Read the transcript
🎙️ Part 1: Introduction & Legal Pathways for Foreign Ownership
Jing: Today on the Bali Business Review, we’re joined by a special guest — someone who’s made a real impact in Bali’s property law space. She’s helped countless property owners navigate legal challenges with clarity.
Welcome to the show, Ibu Sari.
Ibu Sari: Thank you, Jing. It’s a pleasure to be here.
Jing: Can you start by introducing yourself to the audience — your background, the kind of work you do, and your experience in Bali’s real estate scene?
Ibu Sari: Sure. My name is Nilu Sari, and I’m from Canggu. I run a law firm called Malekat Hukum, which means “Angel of Justice.” We’re based in Canggu, with branches in Jakarta and Jogja. Law and property have been part of my life since childhood — my late father was an architect, and my mother is a law professor. I’ve seen Bali transform from rice fields to today’s vibrant property market. My mission is to help property owners — both local and foreign — navigate the legal landscape responsibly and fairly.
Jing: That’s amazing. Roughly how many clients would you say you’ve helped?
Ibu Sari: Directly and indirectly, I’d estimate in the hundreds.
Jing: And how long have you been practicing law?
Ibu Sari: I’ve been actively practicing for about three years, but together with my partners, we have decades of combined legal experience. One of our co-founders is Professor Retno, who teaches company law at a local university.
🏠 Part 2: Can Foreigners Own Land in Bali?
Jing: Let’s jump into it. What’s the legal process for a foreigner who wants to buy or build property in Bali?
Ibu Sari: The most important step is due diligence. Before you do anything, you must check the land certificate, zoning, ownership status, and verify everything — ideally with a lawyer. Foreigners cannot directly own freehold land in Indonesia. Instead, they have two main legal pathways: (1) Establish a PT PMA (foreign-owned company) (2) Use a KITAS or KITAP (temporary or permanent residency permit)
Jing: What’s a PT PMA?
Ibu Sari: It’s a foreign direct investment company, registered in Indonesia. Through this entity, you can legally acquire land under HGB (Hak Guna Bangunan) — the right-to-build title.
Jing: And a KITAS?
Ibu Sari: A KITAS is a limited stay permit. With a KITAS (or KITAP), you can apply for a Hak Pakai title — the right-to-use — for one residential property.
🔍 Part 3: Due Diligence & Cultural Integration
Jing: Can you share some stories from your due diligence experience? What surprises have you uncovered?
Ibu Sari: Plenty. One common issue is landowners misrepresenting zoning — claiming land is buildable when it’s actually in a green zone. We’ve also seen fake IDs and unclear ownership structures, where land is owned collectively but not legally registered.
Sometimes land was inherited decades ago but never officially recorded with the National Land Agency (BPN). This creates massive complications.
Jing: Sounds like legal checks aren’t enough — you also have to understand the culture?
Ibu Sari: Yes. Some land is located near holy areas, and cultural events like full-moon ceremonies may pass through the property. It’s vital to have a relationship with the local banjar (village council).
If you’re respectful and communicate clearly, you’ll avoid 99% of potential problems.
📜 Part 4: Land Title Types in Indonesia
Jing: Let’s break down the different types of land titles in Indonesia:
1.Hak Milik (Freehold)
Ibu Sari: Hak Milik is full ownership, only available to Indonesian citizens. It’s the most secure form of land ownership — but foreigners cannot legally hold it.
2. Hak Pakai (Right to Use)
Ibu Sari: Hak Pakai is available to foreigners with a KITAS or KITAP, for one residential property only. It can be held for 30 years, extendable to 80. Minimum property value in Bali: IDR 5 billion (subject to provincial rules).
3. HGB – Hak Guna Bangunan (Right to Build)
Ibu Sari: If you establish a PT PMA, you can acquire land under an HGB title. It allows you to build and operate properties for business purposes — like villas, hotels, or commercial buildings. Valid for 30 years, extendable to 80.
4. Hak Sewa (Leasehold)
Ibu Sari: Hak Sewa is a private lease agreement. It’s not registered with the land office, and it’s the most common option for foreigners without KITAS or PT PMA. Usually 25–30 years, renewable.
⚠️ Part 5: Nominee Structures
Jing: What about using an Indonesian nominee to buy land?
Ibu Sari: That’s illegal under Indonesian law and extremely risky. While some people still use nominee arrangements, the land remains under the Indonesian’s name. If anything goes wrong, you have no legal protection. We’ve helped restructure such arrangements into legal leases or PT PMA holdings when possible.
💍 Part 6: Buying Through a Spouse
Jing: What if a foreigner is married to an Indonesian citizen? Can they buy land under their spouse’s name?
Ibu Sari: Yes — but you must sign a prenuptial or postnuptial agreement that declares separation of assets. Without that, any property bought during the marriage is considered joint, and foreigners aren’t allowed to co-own land. Some couples also use a leaseback system — where the Indonesian spouse owns the land, and the foreign spouse leases it, ensuring long-term access.
🛏️ Part 7: Pondok Wisata & Rental Licensing
Jing: What’s a Pondok Wisata, and why is it so hard to get?
Ibu Sari: Pondok Wisata is a small accommodation license, like a mini hotel or guesthouse license. It can only be held by an Indonesian citizen or a locally-owned PT — not a PT PMA. So, if a foreigner leases land, the Indonesian landlord must apply for the license. This should be negotiated at the beginning of the lease agreement.
Jing: Is there a standard cost or timeframe?
Ibu Sari: Costs vary depending on zoning, land documents, and tax history. You should always verify zoning first to ensure the license is even possible.
🏗️ Part 8: PBG, SLF, and Building Compliance
Jing: The old IMB is no longer used, right?
Ibu Sari:
Correct. IMB was replaced by: (-) PBG (Persetujuan Bangunan Gedung) – building approval before construction (-) SLF (Sertifikat Laik Fungsi) – certificate of function after construction
Jing: So you need PBG to start building, and SLF to operate legally?
Ibu Sari: Exactly. The SLF ensures the building is safe, structurally sound, and fit for use. Without it, the property is considered illegal.
🗺️ Part 9: PKKPR and Land Use Approval
Jing: And before PBG, there’s something called PKKPR?
Ibu Sari: Yes — PKKPR (Persetujuan Kesesuaian Kegiatan Pemanfaatan Ruang) is a land use approval. It confirms that your planned building fits the local zoning and spatial plan. It’s done online now via the OSS RBA system, and is mandatory before applying for PBG.
💰 Part 10: Taxes & Reporting
Jing: What tax obligations should foreign property owners be aware of?
Ibu Sari: It depends on how you hold the property:
– PT PMA: Monthly and annual corporate tax filings are required.
– Villa rentals: Must pay income tax and local accommodation tax (around 10%)
– Land and building tax (PBB): Paid annually
Unpaid taxes can lead to fines, business license issues, or even property audits.
🚫 Part 11: Legal Enforcement
Jing: What happens if someone skips the legal process?
Ibu Sari: The government can: (1) Freeze the business (2) Seal the property (3) Impose fines (4) In extreme cases, demolish illegal buildings
Enforcement is stricter now, especially in tourism zones like Canggu and Ubud.
🎤 Part 12: Final Advice
Jing: What’s your advice for anyone planning to invest in Bali?
Ibu Sari: Do proper due diligence. Work with legal and cultural experts. Don’t treat Bali as just a business opportunity — it’s a place with rich traditions. If you respect the law and the culture, the community will welcome you, and your investment will thrive.
Jing: Thank you so much, Ibu Sari. This has been incredibly insightful.
Ibu Sari: Thank you, Jing. I’m honored to be part of this conversation.
🗒️Read the transcript
🎙️ Bagian 1: Pengenalan & Jalur Hukum untuk Kepemilikan Asing
Jing: Hari ini di Bali Business Review, kita akan kedatangan tamu spesial – seseorang yang telah membuat dampak nyata dalam bidang hukum properti di Bali. Beliau telah membantu banyak pemilik properti dalam menghadapi tantangan hukum dengan jelas.
Selamat datang di acara ini, Ibu Sari.
Ibu Sari: Terima kasih, Jing. Senang sekali bisa berada di sini.
Jing: Bisakah anda memulai dengan memperkenalkan diri anda kepada para hadirin – latar belakang anda, jenis pekerjaan yang anda lakukan, dan pengalaman anda di dunia real estate di Bali?
Ibu Sari: Tentu saja, nama saya Nilu Sari, dan saya berasal dari Canggu. Saya menjalankan sebuah firma hukum bernama Malekat Hukum, yang berarti “Malaikat Keadilan”. Kami berbasis di Canggu, dengan cabang di Jakarta dan Jogja. Hukum dan properti telah menjadi bagian dari hidup saya sejak kecil – almarhum ayah saya adalah seorang arsitek, dan ibu saya adalah seorang profesor hukum. Saya telah melihat Bali bertransformasi dari sawah menjadi pasar properti yang dinamis saat ini. Misi saya adalah untuk membantu pemilik properti – baik lokal maupun asing – menavigasi lanskap hukum secara bertanggung jawab dan adil.
Jing: Luar biasa. Kira-kira berapa banyak klien yang telah Anda bantu?
Ibu Sari: Secara langsung dan tidak langsung, saya perkirakan mencapai ratusan.
Jing: Dan sudah berapa lama Anda berpraktik di bidang hukum?
Ibu Sari: Saya telah aktif berpraktik selama sekitar tiga tahun, tetapi bersama dengan mitra saya, kami memiliki pengalaman hukum gabungan selama puluhan tahun. Salah satu pendiri kami adalah Profesor Retno, yang mengajar hukum perusahaan di sebuah universitas lokal.
🗒️Read the transcript
🎙️ Part 1: Introduction & Legal Pathways for Foreign Ownership
Jing: Today on the Bali Business Review, we’re joined by a special guest — someone who’s made a real impact in Bali’s property law space. She’s helped countless property owners navigate legal challenges with clarity.
Welcome to the show, Ibu Sari.
Ibu Sari: Thank you, Jing. It’s a pleasure to be here.
Jing: Can you start by introducing yourself to the audience — your background, the kind of work you do, and your experience in Bali’s real estate scene?
Ibu Sari: Sure. My name is Nilu Sari, and I’m from Canggu. I run a law firm called Malekat Hukum, which means “Angel of Justice.” We’re based in Canggu, with branches in Jakarta and Jogja. Law and property have been part of my life since childhood — my late father was an architect, and my mother is a law professor. I’ve seen Bali transform from rice fields to today’s vibrant property market. My mission is to help property owners — both local and foreign — navigate the legal landscape responsibly and fairly.
Jing: That’s amazing. Roughly how many clients would you say you’ve helped?
Ibu Sari: Directly and indirectly, I’d estimate in the hundreds.
Jing: And how long have you been practicing law?
Ibu Sari: I’ve been actively practicing for about three years, but together with my partners, we have decades of combined legal experience. One of our co-founders is Professor Retno, who teaches company law at a local university.
🏠 Part 2: Can Foreigners Own Land in Bali?
Jing: Let’s jump into it. What’s the legal process for a foreigner who wants to buy or build property in Bali?
Ibu Sari: The most important step is due diligence. Before you do anything, you must check the land certificate, zoning, ownership status, and verify everything — ideally with a lawyer. Foreigners cannot directly own freehold land in Indonesia. Instead, they have two main legal pathways: (1) Establish a PT PMA (foreign-owned company) (2) Use a KITAS or KITAP (temporary or permanent residency permit)
Jing: What’s a PT PMA?
Ibu Sari: It’s a foreign direct investment company, registered in Indonesia. Through this entity, you can legally acquire land under HGB (Hak Guna Bangunan) — the right-to-build title.
Jing: And a KITAS?
Ibu Sari: A KITAS is a limited stay permit. With a KITAS (or KITAP), you can apply for a Hak Pakai title — the right-to-use — for one residential property.
🔍 Part 3: Due Diligence & Cultural Integration
Jing: Can you share some stories from your due diligence experience? What surprises have you uncovered?
Ibu Sari: Plenty. One common issue is landowners misrepresenting zoning — claiming land is buildable when it’s actually in a green zone. We’ve also seen fake IDs and unclear ownership structures, where land is owned collectively but not legally registered.
Sometimes land was inherited decades ago but never officially recorded with the National Land Agency (BPN). This creates massive complications.
Jing: Sounds like legal checks aren’t enough — you also have to understand the culture?
Ibu Sari: Yes. Some land is located near holy areas, and cultural events like full-moon ceremonies may pass through the property. It’s vital to have a relationship with the local banjar (village council).
If you’re respectful and communicate clearly, you’ll avoid 99% of potential problems.
📜 Part 4: Land Title Types in Indonesia
Jing: Let’s break down the different types of land titles in Indonesia:
1.Hak Milik (Freehold)
Ibu Sari: Hak Milik is full ownership, only available to Indonesian citizens. It’s the most secure form of land ownership — but foreigners cannot legally hold it.
2. Hak Pakai (Right to Use)
Ibu Sari: Hak Pakai is available to foreigners with a KITAS or KITAP, for one residential property only. It can be held for 30 years, extendable to 80. Minimum property value in Bali: IDR 5 billion (subject to provincial rules).
3. HGB – Hak Guna Bangunan (Right to Build)
Ibu Sari: If you establish a PT PMA, you can acquire land under an HGB title. It allows you to build and operate properties for business purposes — like villas, hotels, or commercial buildings. Valid for 30 years, extendable to 80.
4. Hak Sewa (Leasehold)
Ibu Sari: Hak Sewa is a private lease agreement. It’s not registered with the land office, and it’s the most common option for foreigners without KITAS or PT PMA. Usually 25–30 years, renewable.
⚠️ Part 5: Nominee Structures
Jing: What about using an Indonesian nominee to buy land?
Ibu Sari: That’s illegal under Indonesian law and extremely risky. While some people still use nominee arrangements, the land remains under the Indonesian’s name. If anything goes wrong, you have no legal protection. We’ve helped restructure such arrangements into legal leases or PT PMA holdings when possible.
💍 Part 6: Buying Through a Spouse
Jing: What if a foreigner is married to an Indonesian citizen? Can they buy land under their spouse’s name?
Ibu Sari: Yes — but you must sign a prenuptial or postnuptial agreement that declares separation of assets. Without that, any property bought during the marriage is considered joint, and foreigners aren’t allowed to co-own land. Some couples also use a leaseback system — where the Indonesian spouse owns the land, and the foreign spouse leases it, ensuring long-term access.
🛏️ Part 7: Pondok Wisata & Rental Licensing
Jing: What’s a Pondok Wisata, and why is it so hard to get?
Ibu Sari: Pondok Wisata is a small accommodation license, like a mini hotel or guesthouse license. It can only be held by an Indonesian citizen or a locally-owned PT — not a PT PMA. So, if a foreigner leases land, the Indonesian landlord must apply for the license. This should be negotiated at the beginning of the lease agreement.
Jing: Is there a standard cost or timeframe?
Ibu Sari: Costs vary depending on zoning, land documents, and tax history. You should always verify zoning first to ensure the license is even possible.
🏗️ Part 8: PBG, SLF, and Building Compliance
Jing: The old IMB is no longer used, right?
Ibu Sari:
Correct. IMB was replaced by: (-) PBG (Persetujuan Bangunan Gedung) – building approval before construction (-) SLF (Sertifikat Laik Fungsi) – certificate of function after construction
Jing: So you need PBG to start building, and SLF to operate legally?
Ibu Sari: Exactly. The SLF ensures the building is safe, structurally sound, and fit for use. Without it, the property is considered illegal.
🗺️ Part 9: PKKPR and Land Use Approval
Jing: And before PBG, there’s something called PKKPR?
Ibu Sari: Yes — PKKPR (Persetujuan Kesesuaian Kegiatan Pemanfaatan Ruang) is a land use approval. It confirms that your planned building fits the local zoning and spatial plan. It’s done online now via the OSS RBA system, and is mandatory before applying for PBG.
💰 Part 10: Taxes & Reporting
Jing: What tax obligations should foreign property owners be aware of?
Ibu Sari: It depends on how you hold the property:
– PT PMA: Monthly and annual corporate tax filings are required.
– Villa rentals: Must pay income tax and local accommodation tax (around 10%)
– Land and building tax (PBB): Paid annually
Unpaid taxes can lead to fines, business license issues, or even property audits.
🚫 Part 11: Legal Enforcement
Jing: What happens if someone skips the legal process?
Ibu Sari: The government can: (1) Freeze the business (2) Seal the property (3) Impose fines (4) In extreme cases, demolish illegal buildings
Enforcement is stricter now, especially in tourism zones like Canggu and Ubud.
🎤 Part 12: Final Advice
Jing: What’s your advice for anyone planning to invest in Bali?
Ibu Sari: Do proper due diligence. Work with legal and cultural experts. Don’t treat Bali as just a business opportunity — it’s a place with rich traditions. If you respect the law and the culture, the community will welcome you, and your investment will thrive.
Jing: Thank you so much, Ibu Sari. This has been incredibly insightful.
Ibu Sari: Thank you, Jing. I’m honored to be part of this conversation.
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