Bali villas folder news and information - How foreigners own property in Bali. Bali is the best tourism destination in the world, many five star hotels take a place in some area in Bali. And also many investors are interested to invest their money at property / real estate in Bali. If you are foreigners, this information may use to you :
Fortunately, there are plenty legal constructions to own property on Bali. It is generally safe for foreigners to own a real estate in Bali.
Freehold
If you own property freehold (Hak Milik), means you own the building and the land it stands on. Your name is in the land registry. Foreigners are still not able to obtain freehold property on their own name. The constructions described below enable expats to safely buy and sell their own properties.
Leasehold
Leasehold (Hak Sewa) means you have a lease from the freeholder (the landlord) to use the property for any number of years, up to 25 years. The leaseholder has a contract with the freeholder, defining legal rights and responsibilities of either side. This method offers complete protection to the foreigner during the term of the lease, once the lease term has expired the agreement can be extended or the property reverts to the owner.
Nominee structure
The nominee structure is a contractual agreement between foreigners and Indonesian nationals. The foreigner nominates the Indonesian national to hold the freehold title on his behalf. The typical nominee structure has several agreements, such as the right to use, the right to sell, and a notarised mortgage agreement (stating the nominee has borrowed the money in order to buy the property). The investor is then free to build on the land, and sell or lease the property, the nominee will receive a nominal fee for his responsibilities as the title holder.
Corporate ownership
Indonesian companies are allowed to hold the HGB title (Hak Guna Bangunan), this is the Right to Build title. In this case the freehold title is handed over to the state and the company is given the possession of the property under right to use title for a period of 30 years with the right of extension.
Foreign investors can have 100 % ownership of companies. This is called a PMA (Penanaman Modal Asing), the only form of company allowed for exclusively foreign investment. Foreigners can legally hold property by means of a PMA, without the involvement of an Indonesian nominee or Indonesian shareholder.
Hak Pakai, the ‘Right of use”
Since March 2004 in effect in Bali. This is a very popular arrangement. Hak Pakai can be issued to (foreign) individuals, but also to companies that are domiciled in Indonesia. Hak Pakai is for people living in Indonesia. This does not mean that you can’t leave Indonesia, it just means that you spend a considerable time of the year in Indonesia.
Hak Pakai is an official certificate issued by the land offices. As soon as the Hak Pakai certificate is issued, the certificate has precedent over any other title the property may have.
A foreigner can own only one Hak Pakai title on his or her name at any time. The certificate is valid for an initial 25 years, and can be renewed after that. Some companies offer prepaid renewals for up to a total of 100 years. It’s freely transferable to another name, so you can buy and sell existing Hak Pakai titles.
In conclusion , foreigners can own and acquire a property in Bali, what about you ?
Fortunately, there are plenty legal constructions to own property on Bali. It is generally safe for foreigners to own a real estate in Bali.
Freehold
If you own property freehold (Hak Milik), means you own the building and the land it stands on. Your name is in the land registry. Foreigners are still not able to obtain freehold property on their own name. The constructions described below enable expats to safely buy and sell their own properties.
Leasehold
Leasehold (Hak Sewa) means you have a lease from the freeholder (the landlord) to use the property for any number of years, up to 25 years. The leaseholder has a contract with the freeholder, defining legal rights and responsibilities of either side. This method offers complete protection to the foreigner during the term of the lease, once the lease term has expired the agreement can be extended or the property reverts to the owner.
Nominee structure
The nominee structure is a contractual agreement between foreigners and Indonesian nationals. The foreigner nominates the Indonesian national to hold the freehold title on his behalf. The typical nominee structure has several agreements, such as the right to use, the right to sell, and a notarised mortgage agreement (stating the nominee has borrowed the money in order to buy the property). The investor is then free to build on the land, and sell or lease the property, the nominee will receive a nominal fee for his responsibilities as the title holder.
Corporate ownership
Indonesian companies are allowed to hold the HGB title (Hak Guna Bangunan), this is the Right to Build title. In this case the freehold title is handed over to the state and the company is given the possession of the property under right to use title for a period of 30 years with the right of extension.
Foreign investors can have 100 % ownership of companies. This is called a PMA (Penanaman Modal Asing), the only form of company allowed for exclusively foreign investment. Foreigners can legally hold property by means of a PMA, without the involvement of an Indonesian nominee or Indonesian shareholder.
Hak Pakai, the ‘Right of use”
Since March 2004 in effect in Bali. This is a very popular arrangement. Hak Pakai can be issued to (foreign) individuals, but also to companies that are domiciled in Indonesia. Hak Pakai is for people living in Indonesia. This does not mean that you can’t leave Indonesia, it just means that you spend a considerable time of the year in Indonesia.
Hak Pakai is an official certificate issued by the land offices. As soon as the Hak Pakai certificate is issued, the certificate has precedent over any other title the property may have.
A foreigner can own only one Hak Pakai title on his or her name at any time. The certificate is valid for an initial 25 years, and can be renewed after that. Some companies offer prepaid renewals for up to a total of 100 years. It’s freely transferable to another name, so you can buy and sell existing Hak Pakai titles.
In conclusion , foreigners can own and acquire a property in Bali, what about you ?
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