How Can a Foreigner Buy Property in Bali?
Foreign investors increasingly see Bali as an attractive place to invest in real estate. However, the buying process may differ from standard procedures due to local legal restrictions. In this guide, we’ll cover the main steps that will help a foreigner successfully purchase property in Bali.
1. Understanding Legal Restrictions
In Bali, foreigners cannot own land directly. Instead, they have access to two forms of ownership: long-term leasehold and right to use. Leasehold allows foreigners to own property for up to 80 years, which is convenient for rental and long-term investments.
2. Choosing Property Type and Location
Depending on investment goals, you can choose a villa, townhouse, or apartment. Location is also important. For example, Canggu is a popular area among tourists and expats, where apartments are in high demand, providing a stable rental income.
3. Conducting Legal Due Diligence
Before purchasing, it is essential to ensure the property’s legal status is clear. Working with a trusted developer and lawyer helps avoid risks and ensures proper transaction documentation. Legal due diligence includes reviewing ownership rights, construction permits, and other necessary documents.
4. Signing a Long-Term Lease Agreement
For a foreigner to buy property in Bali, a long-term lease agreement (leasehold) needs to be signed, usually through a notary. This lease can be set for 25-30 years with an option to extend, giving the owner full usage rights, including renting and reselling.
5. Finalizing and Paying Taxes
The notary fee for drafting the lease agreement is about 1% of the property value. Taxes include an 11% sales tax and a 10% rental income tax, paid by the landlord. These expenses should be considered in the investment plan.
6. Property Maintenance and Management
Many foreign investors choose to use a property management company to handle maintenance. This is convenient for those planning to rent the property remotely. Property managers in Bali handle technical maintenance, cleaning, and tenant relations.
7. Benefits of Leasehold for Foreigners
Leasehold in Bali is a reliable way for foreigners to own property with minimal risks. This form of ownership is easy to arrange, doesn’t require complex legal structures, and allows access to rental income. It’s especially convenient for those planning to rent out apartments in high-demand areas like Canggu.
For more information, feel free to contact our managers — they will provide a free consultation and help you find the most profitable properties for investment in Bali.