Indonesia is a popular destination for foreigners looking to live or invest in property. However, there are legal restrictions regarding property ownership for non-Indonesian citizens. So, can foreigners actually own property in Indonesia under their own name?
Foreign Property Ownership: What’s Allowed?
Foreign nationals are not permitted to own property under Freehold Title (Hak Milik), which is the highest form of ownership in Indonesia. However, the government allows foreigners to own property under two legal frameworks:
1. Right to Use (Hak Pakai)
This is the most common option for foreigners seeking to live in Indonesia long term.
Requirements:
- Foreigners must hold a valid stay permit (KITAS or KITAP).
- The property must be purchased directly from a developer (not from the secondary market).
- The minimum property value must meet government thresholds, for example:
- Jakarta: landed house ≥ IDR 10 billion, apartment ≥ IDR 5 billion.
- Bali: landed house ≥ IDR 5 billion.
The Right to Use is valid for 30 years, and can be extended for another 20 years, and then an additional 30 years, for a total of up to 80 years. This right can be inherited or transferred to an Indonesian citizen.
2. Right to Build (HGB) via a Foreign-Owned Company (PT PMA)
For investment purposes, foreigners can establish a foreign investment company (PT PMA) and acquire property under the Right to Build (HGB).
HGB allows construction and use of property on state or leased land for up to 30 years, extendable to a total of 80 years. This is ideal for commercial properties such as rental villas, offices, and hospitality businesses.
Nominee Arrangements: High Legal Risk
Some foreigners attempt to purchase property under the name of an Indonesian citizen (nominee scheme). This practice is highly risky and not legally recognized. In the event of a dispute, the foreigner has no legal claim, as the property is not registered in their name.
Legal Steps to Buy Property in Indonesia
- Obtain a valid stay permit (KITAS/KITAP).
- Choose a qualifying new property from a certified developer.
- Engage a licensed notary to handle the sale agreement and legal documentation.
- Register the ownership rights with the Indonesian Land Office (BPN).
- For investment, set up a PT PMA through the Investment Coordinating Board (BKPM).
Conclusion
While foreigners cannot hold Freehold Title in Indonesia, they can legally purchase and occupy property through Right to Use or Right to Build under specific conditions. Consulting with a licensed notary or legal advisor is essential before making any property transactions.
If you need assistance with residency permits or legal property ownership in Indonesia, Azra Solutions is here to help with trusted, professional support.
Need Property Advice? Speak to Our Expert Consultant
If you’re uncertain about the process or want to ensure your property acquisition in Indonesia is fully legal and safe, we recommend consulting directly with our trusted legal expert.
He is a highly experienced property consultant specializing in foreign ownership, with a strong track record in assisting expatriates navigate Indonesia’s property regulations.
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