Can Foreigners Own Land in Bali? The Complete 2025 Legal Guide to Property Ownership in Indonesia

Bali, known for its breathtaking landscapes, serene beaches, and vibrant culture, has long attracted people from around the world who dream of owning a piece of paradise. Many foreigners wish to buy land or property in Bali, either as a holiday home, retirement retreat, or investment opportunity. However, Indonesian law places specific restrictions on land ownership by foreign nationals, making the process more complex than in many other countries.

At The Bali Lawyer, we specialize in helping foreigners navigate Indonesia’s property and land laws. Our team provides clear, legal solutions that allow foreigners to invest or reside in Bali safely and in full compliance with Indonesian regulations. This guide explains everything you need to know about how foreigners can legally own or control land in Bali, the types of property rights available, and how to protect your investment.

Understanding Land Ownership Laws in Indonesia

Under Indonesian law, land ownership (Hak Milik) is a constitutional right granted only to Indonesian citizens. This means that, by law, foreigners cannot directly own freehold land in Indonesia, including Bali. However, the government provides several legal alternatives that allow foreigners to control, use, or invest in property without breaching ownership laws.

To understand how foreigners can legally hold property in Bali, it’s important to know the main land titles recognized under Indonesian law.

Main Types of Land Titles in Indonesia

  1. Hak Milik (Right of Ownership)
    This is the strongest form of land ownership in Indonesia, similar to freehold ownership. It can only be held by Indonesian citizens. Foreigners are strictly prohibited from holding Hak Milik land directly.

  2. Hak Pakai (Right of Use)
    This title allows foreigners and foreign legal entities to use and occupy land for residential or business purposes. It’s one of the most common and safest ways for foreigners to legally hold property in Bali. Hak Pakai can be granted for an initial period and extended based on government regulations.

  3. Hak Guna Bangunan (Right to Build)
    This right allows individuals or companies to construct and own buildings on land owned by another party, typically under a lease or government agreement. Foreign-owned companies (PT PMA) can obtain this right for business and investment purposes.

  4. Hak Sewa (Right to Lease)
    Foreigners can lease land from an Indonesian owner for a specific duration under a private agreement. While it does not provide ownership rights, it allows foreigners to use and develop the land legally within the agreed period.

  5. Hak Guna Usaha (Right to Cultivate)
    This title applies mainly to agricultural land used for farming or plantation purposes. It is generally not relevant for residential or commercial property buyers.

Can Foreigners Own Land in Bali Directly?

In short, no — foreigners cannot legally own land under the Hak Milik title. However, foreigners can legally control property through structured ownership methods such as:

  • Acquiring a Hak Pakai (Right of Use) over land.

  • Establishing a PT PMA (Foreign Investment Company) to hold a Hak Guna Bangunan (Right to Build).

  • Entering into a leasehold agreement (Hak Sewa) with an Indonesian landowner.

Each of these methods offers different benefits, durations, and legal protections depending on the foreigner’s goals — whether for residence, investment, or business purposes.

Legal Ways for Foreigners to Own or Control Property in Bali

1. Through Hak Pakai (Right of Use)

The Hak Pakai title is the most straightforward way for foreigners to acquire legal control over property in Bali. It allows foreign nationals or foreign companies to use land owned by the state or an Indonesian citizen for residential or commercial purposes.

Key points about Hak Pakai:

  • Can be granted to foreigners with a valid stay permit (KITAS or KITAP).

  • Allows full residential use and legal residence registration.

  • Can be extended according to Indonesian property laws.

  • Provides a certificate from the National Land Agency (BPN) proving the right.

Hak Pakai offers security and is recognized by the Indonesian government as a legitimate form of property ownership for foreigners.

2. Through a PT PMA (Foreign-Owned Company)

Another legal and commonly used method for foreigners to own land or property in Bali is by establishing a PT PMA (Perseroan Terbatas Penanaman Modal Asing) — a foreign investment company.

A PT PMA can legally acquire land under the Hak Guna Bangunan (Right to Build) title, allowing it to construct and operate buildings for business activities. This option is ideal for investors who want to:

  • Develop villas, hotels, or resorts.

  • Purchase property for business operations.

  • Secure long-term rights under Indonesian law.

Advantages of using a PT PMA:

  • Full legal ownership under a corporate entity.

  • Ability to generate income from rental or commercial use.

  • Renewable long-term rights to build and operate property.

Setting up a PT PMA requires compliance with Indonesian company laws, and The Bali Lawyer provides full legal assistance for company registration and land acquisition under this structure.

3. Through Leasehold (Hak Sewa)

Leasing land is another practical way for foreigners to enjoy property rights in Bali without direct ownership. Under Hak Sewa, foreigners can lease land or property for a long-term period based on a private agreement with the landowner.

Key features of Hak Sewa:

  • The lease is formalized through a notarial agreement.

  • Lease duration is negotiable and can often be extended.

  • The lessee can build, renovate, or sublease within agreed terms.

While leasehold doesn’t offer ownership, it provides flexibility and security for residential or investment purposes, making it a popular choice among foreigners.

Important Legal Considerations

Foreigners must be cautious when purchasing or leasing property in Bali. Misunderstanding land laws can lead to legal disputes or property loss. Here are essential considerations:

  1. Avoid Using a Nominee Arrangement
    Some foreigners use an Indonesian nominee (local citizen) to hold land under their name. While this may appear convenient, it is illegal and highly risky. Such agreements are not recognized by Indonesian law and can result in losing your investment.

  2. Always Verify Land Certificates
    Before entering any transaction, ensure that the property has a valid certificate from the National Land Agency (BPN) and is free from disputes or encumbrances.

  3. Check Zoning Regulations
    Bali has specific zoning laws that define land use (residential, commercial, or agricultural). Make sure the land’s zoning aligns with your intended purpose.

  4. Obtain Legal Due Diligence
    Conducting due diligence through a qualified legal service like The Bali Lawyer ensures that your transaction complies with all legal and administrative requirements.

  5. Stay Compliant with Immigration Status
    If you’re purchasing Hak Pakai property, you must hold a valid residence permit (KITAS or KITAP) as required by law.

The Role of The Bali Lawyer in Land Ownership for Foreigners

Navigating Indonesian property laws can be complex for foreign nationals, but The Bali Lawyer provides expert legal guidance and representation to make the process transparent, compliant, and secure.

Our services include:

  • Legal consultation on property ownership and investment structures.

  • Drafting and reviewing sale, lease, and use agreements.

  • Verification of land certificates and due diligence.

  • Establishment of PT PMA for property or business ownership.

  • Assistance with Hak Pakai and Hak Guna Bangunan applications.

  • Notarial documentation and registration with the National Land Agency (BPN).

By working with The Bali Lawyer, you ensure that your investment in Bali property follows the proper legal framework and remains fully protected.

Steps to Acquire Property Legally as a Foreigner

  1. Consult a Legal Expert
    Start by consulting a professional legal service to determine the most suitable ownership method for your goals (Hak Pakai, PT PMA, or leasehold).

  2. Choose the Property and Conduct Due Diligence
    Verify the property’s legal status, ownership certificate, and zoning classification.

  3. Prepare Legal Agreements
    Draft and review contracts under Indonesian law, ensuring they clearly define ownership rights, usage terms, and extension options.

  4. Register and Obtain Land Rights
    Complete the registration of land rights through the National Land Agency (BPN) with legal assistance to ensure compliance.

  5. Maintain Compliance and Renewals
    Keep your land rights, licenses, and immigration documents up to date to avoid legal complications.

Long-Term Benefits of Legal Property Ownership

Owning or controlling land in Bali through legal means offers significant benefits:

  • Security: Legal recognition of your property rights.

  • Profitability: Ability to develop or rent property for income.

  • Longevity: Renewable rights for long-term use.

  • Peace of Mind: Compliance with Indonesian laws ensures stable ownership.

Many foreign investors who follow the legal route find that Bali offers excellent opportunities for lifestyle and business, supported by a strong tourism industry and growing demand for property.

Common Misconceptions About Land Ownership in Bali

  1. “Foreigners can own land using a local nominee.”
    False. This arrangement is illegal and unenforceable in court.

  2. “Hak Pakai is temporary and not secure.”
    Incorrect. Hak Pakai can be extended under Indonesian law and provides recognized legal ownership for foreign residents.

  3. “Setting up a PT PMA is only for big investors.”
    Not true. Any foreigner intending to conduct business or invest in property can establish a PT PMA with the proper structure.

  4. “Leasing is not worth it because it’s temporary.”
    Leasehold rights can extend for decades and be renewed, making them practical for long-term living or investment.

While Indonesian law does not allow foreigners to directly own land under the Hak Milik title, there are several legal and secure alternatives that enable foreigners to invest, build, and live in Bali safely. By choosing the correct legal structure — such as Hak Pakai, PT PMA, or Hak Sewa — you can fully enjoy the benefits of owning property in one of the world’s most desirable destinations.

At The Bali Lawyer, we are committed to helping you achieve your property goals in Bali with full legal protection. Our team ensures that every step of your property acquisition — from consultation to documentation — is handled with precision and compliance.

If you’re planning to purchase or invest in property in Bali, contact The Bali Lawyer today. We’ll guide you through Indonesia’s property regulations and help you secure your piece of paradise — legally and confidently.

The Bali Lawyer
Trusted Legal Experts in Property, Business, and Immigration Law in Bali
Helping Foreigners Invest and Live Legally in Indonesia