One of the most common questions we hear from buyers is: “Can foreigners own property in Bali?” The short answer is: yes—with some important distinctions. Bali’s real estate market operates under two primary ownership structures: freehold (Hak Milik) and leasehold (Hak Sewa). Each comes with its own advantages, limitations, and legal considerations. Whether you’re planning to invest, retire, or build your dream holiday villa, understanding these terms is essential before signing anything.
What is Freehold (Hak Milik)?
Freehold means the buyer owns the land outright. However, only Indonesian citizens can legally hold Hak Milik titles. Foreigners can access freehold land only by using legal structures such as:
- Buying through an Indonesian nominee (risky and often discouraged)
- Setting up a foreign-owned company (PT PMA), which allows ownership under the Right to Build (Hak Guna Bangunan)
What is Leasehold (Hak Sewa)?
Leasehold gives you the right to use the land and property for a fixed period—typically 25 to 30 years, with renewal options. It’s the most common and safest path for foreign buyers.
Pros of Leasehold:
- Fully legal and transparent
- Lower upfront costs
- Flexibility for short- to mid-term investments
Cons of Leasehold:
- No ownership of the land
- Must negotiate renewals at the end of term
- Potential depreciation if not renewed
What’s Best in 2025?
For most foreign investors, leasehold remains the most straightforward and secure option. If you’re making a long-term commitment or developing multiple properties, a PT PMA may be worth exploring with a legal advisor.
Always work with reputable agents and legal teams to ensure full compliance with Indonesian property laws.
