How to Legally Buy Land in Bali as a Foreigner (2025 Update)

Dreaming of owning your slice of Bali? You’re not alone. While buying property in Bali as a foreigner is more accessible in 2025, navigating Indonesian property law can be complex. The crucial reality: foreigners cannot directly own freehold (Hak Milik) land in Indonesia.

But don’t be discouraged! Understanding legal structures like leasehold (Hak Sewa, Hak Pakai), corporate ownership via a PT PMA company (granting Hak Guna Bangunan – HGB), and working with licensed professionals are key to securing your investment legally and safely. This guide cuts through the confusion, revealing how to buy land in Bali legitimately, avoid costly mistakes, and protect your investment under Indonesian law for 2025 and beyond.

Common Pitfalls: Why Foreign Buyers Get It Wrong in Bali

Many foreign investors, lured by paradise, stumble into costly traps. Here’s how to avoid them:

1. The Freehold Illusion: Chasing Hak Milik (Right to Own) is a waste of time and money for foreigners, as it’s exclusively for Indonesian citizens. This often leads to illegal nominee schemes.
2. Skipping Due Diligence: Failing to thoroughly check the land certificate at the Land Office (BPN), verify zoning (ITR/KKPR), and confirm building permits (IMB/PBG) can lead to buying disputed land or property with unusable zoning.
3. “Too Good to Be True” Deals: Unbelievably low prices often hide major issues like lack of access, legal disputes, or outright scams.
4. Verbal Agreements & Handshake Deals: Indonesian property law requires specific, formal documentation (like an Akta Jual Beli from a PPAT). Informal deals are unenforceable.
5. Ignoring Zoning (ITR/KKPR): Building on land not zoned for your intended purpose can result in demolition orders and total loss.
6. Illegal Nominee Schemes: Using an Indonesian citizen’s name to hold freehold title on your behalf is illegal, offers no legal protection, and is actively targeted by authorities.

Step 1: Understand Your Legal Property Options in Bali (2025)

Successful investment starts with knowing what’s legally possible for foreigners.

• Freehold (Hak Milik): Grants complete ownership. Not available to foreigners.
• Leasehold Options for Foreigners:
  • Hak Pakai (Right to Use): Allows a foreigner (often linked to a valid stay permit like KITAS or the Second Home Visa) to use land for a specified period, potentially up to 80 years through extensions and renewals. Best for residential purposes.
  • Hak Sewa (Right to Lease): A contractual agreement to lease land or buildings, typically for 25 years, often with options to extend as per the agreement with the Indonesian landowner.
  • Hak Guna Bangunan (HGB – Right to Build): This title grants the right to construct and own buildings on land. It’s the primary title used by PT PMA companies. Typically granted for 30 years, extendable for 20, and renewable for another 30 (totaling 80 years).

The PT PMA Solution: Secure Corporate Ownership

For investors seeking robust ownership rights and the ability to conduct business, establishing a PT PMA (Foreign Investment Limited Liability Company) is the most secure route. Your PT PMA can acquire property under an HGB title.

• PT PMA Key Aspects (2025 – always verify current specifics):
  • Minimum Investment: Generally IDR 10 billion (approx. USD 625,000-640,000, subject to exchange rates and official BKPM figures).
  • Structure: Requires at least two shareholders, one director, and one commissioner (check latest regulations on foreign/local composition).
  • Ownership: The PT PMA company’s name is on the HGB land certificate.
  • Benefits: Offers long-term control (up to 80 years with HGB) and the ability to legally operate a business and generate income from the property.

Key 2025 Regulatory Updates & Considerations:

• VAT (PPN): Was scheduled to rise to 12% on January 1, 2025. Confirm implementation status as this impacts transaction costs.
• Second Home Visa: Offers long-term stays for affluent foreigners. Requires proof of funds (e.g., IDR 2 billion in an Indonesian state-owned bank) and can be linked to property investment plans.
• Golden Visa: For very substantial investors, offering even longer residency.

Step 2: Due Diligence – Your Non-Negotiable Shield

Indonesian property transactions demand meticulous legal checks.

• Verify the Land Certificate: Authenticate it at the National Land Office (BPN). Ensure clear ownership, no disputes, and the correct title type.
• Confirm Zoning & Permits: Check the ITR (Informasi Tata Ruangan) or the newer KKPR (Kesesuaian Kegiatan Pemanfaatan Ruang) to ensure the land’s zoning matches your intended use. Verify building permits (IMB/PBG).
• The PPAT (Land Deed Official) is Mandatory: Every land transaction must go through a regional-specific PPAT (Pejabat Pembuat Akta Tanah). The PPAT drafts the Akta Jual Beli (AJB – Deed of Sale and Purchase), verifies documents, ensures legal compliance, and registers the transaction.
• Financial Transparency: Declare the full transaction price. Use traceable banking channels. Budget for taxes (Buyer: BPHTB ~5%; Seller: PPh ~2.5%; plus VAT, Notary/PPAT fees).
• Avoid Payment Scams: Never wire full payment directly to unknown sellers. Use the PPAT’s official client account for payments aligned with legal milestones.

Step 3: Assemble Your Trusted Professional Team

Navigating Bali’s property market without experts is risky.

• Licensed Real Estate Agent: Provides market insights, helps find suitable properties, and understands foreign buyer needs. Ensure they are legally registered.
• Independent Property Lawyer (Advokat): Crucial for representing your interests. They conduct thorough due diligence, advise on legal structures, and review all contracts.
• Notary (Notaris) & PPAT: A Notaris handles general legal deeds (like PT PMA establishment). The PPAT is specifically for land transactions. They can sometimes be the same person but must be licensed for the property’s region.

Red Flags to Watch Out For:

• High-pressure sales tactics or “too good to be true” deals.
• Requests for large cash payments or transfers to personal overseas accounts.
• Offers involving illegal nominee structures.
• Dealing with unlicensed or unverified “professionals.”
• Hesitancy to provide clear documentation (certificates, zoning, permits).

Beyond the Transaction: Integrating Successfully

Successful investment includes respecting local culture. Learn basic Bahasa Indonesia, understand local customs (adat), and build positive community relationships.

Conclusion: Your Path to Legal Bali Property Ownership

Buying land in Bali as a foreigner in 2025 is achievable with due diligence and professional guidance. While direct freehold (Hak Milik) is off-limits, leasehold agreements (Hak Pakai, Hak Sewa) and corporate ownership via a PT PMA (with HGB title) offer secure, long-term investment paths.

Key Takeaways:

• Foreigners cannot own freehold land.
• Leaseholds and PT PMA (HGB) are your legal routes.
• Thorough due diligence (certificates, zoning, PPAT) is non-negotiable.
• Engage licensed, independent professionals (agent, lawyer, Notary/PPAT).
• Avoid nominee schemes and be wary of red flags.
• Stay informed on 2025 regulations (visas, taxes).

By following these guidelines, you can confidently navigate the Bali property market and secure your piece of paradise.

Ready to Make Your Bali Dream a Legal Reality?

Navigating Bali’s property market can be complex, but you don’t have to do it alone. Pellago Real Estate Agency specializes in guiding foreign investors like you through every step of the legal property acquisition process.

Why Choose Pellago?

• Specialized Expertise: Focus on foreign investment in Bali.
• Legal Clarity & Up-to-Date Knowledge: Understanding of Bali property law, including 2025 regulations.
• Multilingual Team: Clear communication in English, Bahasa Indonesia, Estonian, Finnish, and Russian.
• Comprehensive Service Network: Land sales, villa representation, and referrals for legal support, investment advisory, and property management.
• Trusted Professionals: Connections with vetted, licensed lawyers and notaries (PPATs).

Contact Pellago Real Estate Agency today for a consultation, and let us help you secure your dream property in Bali – legally and safely.