When it comes to buying land in Bali, foreigners are at a distinct disadvantage when compared to the rights available to native citizens of the island. Despite the many complications that can arise when trying to invest in buying a villa in Bali, there are ways in which foreign investors can safely purchase the rights to build on this fabulous Indonesian paradise.
The Basics of Buying a Villa in Bali
Unfortunately, at this point in time it is not possible for someone who is not a citizen of Bali to personally own property in Bali. That isn’t to say that a foreign investor can’t think about buying land in Bali, only that to do so they will either need to get a native islander to act as a nominee freeholder, or they will need to form a foreign investment company which will hold the actual deeds to the land in question.
Most people who end up buying land in Bali do so by using an Indonesian native as their nominee freeholder. It does require an immense amount of trust and often quite a bit of legal wrangling, but for people buying a villa in Bali to act purely as a personal holiday home, this is the easiest route to take. There are companies set up specifically for facilitating this kind of arrangement, which does make buying land in Bali a lot easier. However, for those looking to make a return on their investment, it is generally wiser to set up a PMA company to act on their behalf.
Buying Land in Bali Using a Foreign Investment (PMA) Company
Technically foreign investment companies don’t actually own the land they’re investing in. Instead the license gives the right to use the land in a certain way for a predefined amount of time (normally no longer than 25 years), after which the company will need to buy another license in order to maintain control over the building in question.
Whilst this is clearly not the same thing as actually buying land in Bali, it is the closet that a foreign investor can get to actually owning land or buying a villa in Bali. Renewing the license is easy and merely requires the submission of a few bits of paperwork and the applicable fee. As long as the land is being used for the purpose which the original license was granted (say building a set of villas with the intention of renting them out to tourists), continuously extending the companies right of use is not a problem.
Given that tourism on the island is growing steadily year on year, there has never been a better time for buying land in Bali. Whichever method you choose for buying a villa in Bali, there are companies on the island that are well positioned to help make the transaction as easy as possible for you. So make sure to spend time speaking with some of the local investment companies before you decide what route will suit your situation the best.
Before making a massive invest like buying land in Bali, its always a worthwhile investment of time and money to decide whether this is the right decision for you. Why not rent a villa in Bali first to see if you like it?