Having a Property in Bali As Foreigner – As a slice of Indonesia’s territory, there is an island. Many people claimed it to be one of the most beautiful islands in the world. Attractions are located everywhere your eyes gaze, making many potential tourists come by to visit. It’s a wonderful island, in terms of tourism and business aspects. It’s like the true golden mind of the world. Not only rich full in places to enjoy, but also holds a huge potential gain from investments.
That’s why so many foreigners would like to get a little taste of glory as well, by developing property business on the land of Bali. But it’s not easy as pie. Due to the recent administration process, foreigners can’t have a property in Bali. Yes, they can’t have a building under the name, not only in Bali, but Indonesia in general. But, there are solutions for this problem.
Even though they can’t directly have a property, they can do several things in order to get the right to hold the ownership. All they need to have is to do some things to acquire the required certificates. But still, it’d be very costly and time consuming, As long as you can get a hold of this, you can do it.
Building PT PMA
One of the most common ways to acquire properties in Indonesia is to build your own PT PMA. It means a limited foreigner-owned company in Indonesia. So with this, the owner can have the Right to Use (Hak Pakai) and the Right to Build (Hak Guna Bangunan). With these two certificates in your hands, you may be able to build and develop a business right under your name legally.
It’s way more safe and legal than directly picking Indonesian nominees, which have a huge risk. We’ll talk about that later. In order to build your own PT PMA, you must follow certain procedures. You need to fill the forms in Indonesian National Land Office (or BPN) thoroughly and fill in the required documents. It can be done by the chosen representative, so make sure to ask the correct and dependable party.
After the process, you can finally get the certificates under your company’s name. Both of them are valid for 25 years and can be extended later to 80 years. It can also be sold or converted as well when there’s Indonesian people want to take over the property. The time needed for the process to be done varies. But usually, it’ll be done over 6 to 10 weeks. Make sure to do some research to find the best representative for your business.
If building PTMA is too complex for you, then maybe you could switch for the only alternative, the Long Time Rental. It’s possible to do by foreigners. They can have a long time rental with Indonesian people. When they do, they get the certificate of Hak Sewa (Right to Lease). It’s legal and has a long period of time.
The same as the two certificates above, it’s valid for 25 years, and can be extended to 70 years. Usually, the ones who want to use this method are the investors who want to get quick money through property rentals. Once one has the Hak Sewa certificate, they can re-rent it to other people. Making a quick source of cash flow and quick cash.
The condition of the market wouldn’t be a great concern, since their income doesn’t depend on the market’s value. The buildings like hotels and villas are always needed, especially during holidays. But, the certificate will be returned to the original owner once it’s expired, and converted to Hak Milik certificate.