Bali is a dream holiday destination.
However for many it is also a dream investment destination.
Its tropical landscapes, vibrant culture and world-class beaches attracts many tourists: In the south of Bali, surfers are the main tourist. In the north of Bali, home to #1 Yoga teaching, it attracts Yogis.
With real estate delivering 11-27% ROI, It seems like a dream investment.
However it’s essential to understand the legal system and navigate the process strategically.
The question still remains:
Can foreigners Buy Property in Bali?
The short answer is yes!
Whether you’re looking for a holiday home or a profitable investment property, Bali’s real estate market offers options for foreigners to own land and property legally and securely.
Let’s me explain how.
Option 1: Leasehold Ownership
One of the easiest ways for individual foreigners to own property in Bali is through leasehold agreements.
This is simple, and you don’t need to set up any company structures.
These leases can span up to 40-70 years and with Bali’s average ROI on property investments being just 5-7 years, offering plenty of time to enjoy and profit from your investment.
Benefits of Leasehold Properties:
- They Are Easy To Set Up: Leasehold agreements in Bali are easy to enter into by foreign individuals, and can be drafter and notarised by a ‘notary’ in Bali.
- Affordability: Leasehold properties are generally cheaper upfront than freehold alternatives.
- Flexibility: You can pay 25 years now, and 25 years later.
Option 2: Freehold Ownership Through a Company
For those who want outright ownership, freehold land is the way to go.
While Indonesian law doesn’t allow foreign individuals to directly own freehold property, you can easily set up a local company (commonly a PMA, or foreign-owned company).
This company can own freehold land, giving you the same rights as a local property owner.
Why Choose Freehold Ownership?
- Capital Gain: A Freehold Property investment gives you the greatest upside for capital appreciation.
- Legacy: Whilst more expensive, you can pass this onto your kids.
Bali is a Hotspot for Property Investment
Bali is booming with opportunities for property investors.
The island’s popularity as a tourist destination ensures a constant demand for luxury villas, holiday rentals, and boutique accommodations.
With a growing infrastructure and a high ROI potential, it’s no wonder foreigners are seizing the chance to invest here.
Key Steps to Investing in Bali
1. Engage Reputable Professionals
Begin your journey by hiring a trusted real estate agent and legal counsel familiar with Bali’s property market. They will:
- Verify property ownership titles.
- Draft or review lease agreements.
- Ensure all zoning and building permits are in place.
2. Understand the Lease Agreement
The lease agreement is the foundation of your investment. Pay close attention to:
- Duration: Typical 1st term last 25-30 years and 2nd term can be negotiated for further 25-35 years.
- Extension Clauses: Ensure terms for renewal are clear and mutually agreed upon.
- Usage Rights: Confirm whether you can rent the property to tourists or use it solely as a personal retreat.
3. Conduct Property Due Diligence
Work with professionals to:
- Verify the land’s status as leasehold or freehold.
- Check for encumbrances or disputes.
- Ensure compliance with local regulations.
4. Calculate Additional Costs
Beyond the lease price, consider:
- Legal fees and taxes.
- Annual property maintenance and security costs.
- Optional villa management services if you plan to rent it out.
Final Thoughts
So, can foreigners buy land in Bali? Absolutely!
Buying a leasehold or freehold villa in Bali is an exciting and rewarding venture for foreign investors.
By understanding the legal system, conducting thorough due diligence, and leveraging professional expertise, you can secure your slice of paradise with confidence.
Ready to take the next step?
Learn more here.