Property Sales
Foreigner's Safest Way of Buying Villa in Bali
February 27, 2023 •
3 min read
Foreigner’s Safest Way of Buying Villa in Bali

Buying villa in Bali as a foreigner is possible. Bali is not only a comprehensive travel and holiday destination, but an increasing number of foreigners are also investing in the island by buying villa in Bali.

However, foreigners often acquire villa in a risky way. It’s common practice for foreign investors to acquire villa using a local individual nominee. It gives the foreigner essentially no protection over their investment.

In this article, we will show you on how to safely buy villa in Bali. It is by setting up a foreign-owned company (called PT PMA).

Bali villa ownership by foreigners

Law 5 of 1960 regulates property and real estate ownership in Indonesia. There are three types of right relevant to the article:

  • Right to Own (Hak Milik)
  • Right to Build (Hak Guna Bangunan)
  • Right to Use (Hak Pakai)

Many foreign investors think the way to purchase villa in Bali is by using an Indonesian citizen (nominee). It is used to act on their behalf to acquire the Hak Milik certificate.

However, it is a tremendously risky practice as the local nominee. They possibly can overtake the villa and there is not much a foreigner buyer can do to protect their investment.

Then, how to buy villa in Bali safely?

The safest way for a foreign to invest villa in Bali is to do it through foreign-owned company (PT PMA). You will then acquire the ‘Right to Build’ (Hak Guna Bangunan) certificate.

A PT PMA is a foreign limited liability company in Indonesia. With PT PMA, you have the right to acquire Right to Build (Hak Guna Bangunan/HGB) and Right to Use (Hak Pakai/HP) certificates.

Essentially both licenses make you the owner of the property. Your family members can inherit them and you can sell the property. If the buyer is an Indonesian citizen, they are also able to convert the certificate to a Hak Milik (right to own).

If you wish to hold the property after the 80 years (which would potentially be the 22nd century by then), you can acquire a new certificate once the old one expires.

Note that you can hold Hak Pakai only if the land already has a building on it. Also, there are limitation for operating a property with a Right to Use (Hak Pakai) certificate as a business. There is also minimum value to property and it must be located in touristic, residential, or trading area. It is because you cannot acquire land in Bali in agricultural or greenbelt zones.

Since the purpose of Hak Pakai is acquiring property for personal use, a person can hold only one Hak Pakai. However, it is possible to acquire several properties with the Right to Build.

The process of buying villa in Bali

To acquire Right to Build or Right to Use, you will need to:

  1. Submit completed forms to the Indonesian National Land Office (BPN) requesting a certificate over the property, including relevant supporting documents.
  2. Provide proof of land payment and the conditions for hak Guna Bangunan or Hak Pakai are met
  3. Acquire the right to build the the building permit (IMB)
  4. The BPN will issue the certificate under your company’s name.

Why you should not buy villa in Bali using a local nominee

Since foreign nationals (or even local companies) cannot acquire Hak Milik (land ownership, also called freehold), many foreign investors believe they have to use local nominees.

Sometimes, foreign national believe that they have found a local person they can 100% trust. Another hand is that they think it’s better or easier to buy land under that person’s name.

While you might have all the trust and the local person can have the best intentions, it’s still an investment on shaky ground as you will have no legal rights to control the property.

Interested in buying villa in Bali?

The purpose of this article is to show you the right way of buying property in Bali as a foreigner.

The only way foreigner can safely invest villa in Bali is owning an Indonesian legal entity- PT PMA. Property owned by a foreigner may not be freehold ownership, but the Right to Build and Right to Use tiles give you clear legal grounding.

If you consider to go with the lease hold or short lease as the other preference before you decided to own one, our consultant “buddy” can provide a consultation space for you and we will make sure you get the best deal.

By acknowledging the safest way to buy villa in Bali, are you ready enough to purchase now? Get started by browsing our selected properties or send us a message at:

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Type of property ownership dedicated for local investors or foreigners under legal cooperation in Indonesia. The freeholder of a property owns it outright, including the land it is built on. If you buy freehold, you’re responsible for maintaining your property and land, so you’ll need to budget for these costs and taxes.


Surat Hak Milik (SHM) / Surat Hak Guna Bangunan (SHGB)


Lifetime, or until it’s sold to a new owner

owner status

Indonesian individual only or foreigner who has a company in Indonesia (PMA) to buy the property under that company’s name



Type of property ownership for foreign investors who are willing to purchase the property as an individual. With leasehold, you own the property (subject to the terms of the leasehold) for the length of your lease agreement with the freeholder. When the lease ends, ownership returns to the freeholder, unless the contract states guaranteed lease extension at future market price.


Akta Sewa / Right to use – Right to rent


Average 20-30 years, with possible extension. Maximum 99 years

owner status

All people including Indonesian and foreigner with KITAS-Visa status