Buying Land in Bali: A Complete Legal Guide

Understanding Land Ownership in Bali Bali’s breathtaking landscapes and investment potential make it a prime location for purchasing property. However, foreign ownership laws in Indonesia are complex. It is crucial to understand the regulations before making any commitments. The legal framework governing land ownership in Bali is primarily based on Indonesian land law, which restricts direct foreign ownership. However, there are legal pathways available for foreign investors.

Types of Land Titles in Bali There are several types of land ownership titles in Indonesia, each with specific rights and restrictions:

  1. Hak Milik (Right to Own) – This is the strongest form of land ownership but is only available to Indonesian citizens.

  2. Hak Pakai (Right to Use) – This title allows foreigners to legally use land for residential purposes, typically for up to 80 years.

  3. Hak Guna Bangunan (Right to Build) – Available for businesses and foreign-owned companies (PT PMA), this title allows construction and ownership of buildings on leased land.

  4. Leasehold Agreements – Foreigners often acquire land through long-term lease agreements, typically lasting between 25 and 80 years.

Legal Ways for Foreigners to Buy Land in Bali Since Indonesian law does not permit foreigners to hold freehold land titles, here are legal alternatives:

  • Leasehold Agreements – A lease agreement between a foreign buyer and an Indonesian landowner allows the use of land for an extended period.

  • PT PMA (Foreign-Owned Company) – Setting up a PT PMA allows a foreign investor to obtain a Hak Guna Bangunan title for business or investment purposes.

  • Hak Pakai Title – Foreigners who hold a valid visa and reside in Indonesia can purchase property under a Hak Pakai title.

  • Nominee Agreement (Not Recommended) – Some investors use an Indonesian nominee to hold the land on their behalf, but this method carries legal risks.

Key Steps to Buying Land in Bali

  1. Legal Due Diligence – Before purchasing land, conduct thorough due diligence to ensure the land has a clear title, is free of disputes, and meets zoning regulations.

  2. Engage a Lawyer – Working with an experienced legal professional ensures compliance with Indonesian property laws and avoids legal pitfalls.

  3. Land Survey and Zoning Check – Verify that the land is suitable for your intended use and complies with local zoning laws.

  4. Draft a Sale and Purchase Agreement – The agreement should outline payment terms, land status, and legal obligations of both parties.

  5. Complete the Transaction – The transfer of ownership or lease must be officially recorded at the Indonesian National Land Agency (BPN).

  6. Obtain the Necessary Permits – Ensure you secure building permits (IMB/PBG) and necessary approvals if you plan to develop the land.

Common Pitfalls to Avoid

  • Unverified Ownership Claims – Always request official land certificates from the BPN.

  • Zoning Issues – Some areas in Bali are designated for agriculture and cannot be developed.

  • Illegal Nominee Structures – The Indonesian government does not recognize nominee arrangements, which can lead to loss of property.

  • Lack of Legal Support – Hiring a legal expert ensures a secure and legally compliant transaction.

Why Choose The Bali Lawyer? At The Bali Lawyer, we provide expert legal assistance for property transactions, ensuring compliance with Indonesian land laws. Our team specializes in land due diligence, title verification, lease agreements, and PT PMA establishment. Whether you’re investing in a villa, commercial property, or long-term lease, we guide you through every legal step to secure your investment in Bali.

Contact Us Today If you are considering buying land in Bali, contact The Bali Lawyer for professional legal advice and seamless property transactions. We help you navigate the legal complexities of Bali’s real estate market with confidence.