Australian owning Property in Bali

So I heard starting my own business/company in bali would assist in solidifying a deal to purchase land (well kind of purchase land at least). If I started a PMA and found a good notarist how safe am I with purchasing freehold land; obviously with the correct documents people have posted about before. Or is it still basically up to the trust of having an honest Indonesian to work with.

Furthermore, I have met another Australia who has done something similar with an indonesian family he has known for a 15 years where they are buying and selling houses together. Just how feasible is it to join in with these guys or am i just asking for a shot load of trouble. I'm mean I want to have my own piece of paradise and be financially secure but is it really possible.

Using a PMA to purchase property here is not viable anymore.  Minimum PMA investment start ups have increased greatly (do some searching on that) and you need an Indonesian partner anyway.

Moreover, a PMA cannot be used for the sole purpose of buying land. 

What your friend is doing is called using an Indonesian nominee as the name holder on the Hak Milik land deed.  Your friend then "leases" the land from the nominee.  That can be very risky, although some expats have used that approach with success.  The problems usually come up when the person in whose name the Hak Milik is made, dies. 

Get the idea of owning land in Bali freehold out of your mind.  Go the Hak Pakai lease route and you'll be fine.   

Also, don't just use a notaris.  Use a good lawyer...such as Peter Johnson who also happens to be an Australian.

Thanks for responding so quickly. Actually they have been working as a team buying land developing small houses and selling to other aussies looking to move over. Does this sound just as risky he has known them for around 20 years and grew up with them and I was thinking about getting involved to try and build a little nest egg. Have you got some further advice, obviously the land isn't in his name long only about 6 months to a year between building and selling. Still a bad idea if you look at it from this perspective?

After this i would most likely lease for myself exclusively. Really I would like to try and build my own places and then on sell them later. Or is everyone trying to do that now and i have royally missed the boat. Ive read all most of your posts ubudian and you seem pretty honest. Whats your thoughts and what I'm thinking about doing

Right now it all depends on which regency in Bali you have these land development plans.

I can tell you that things in my regency, which is Gianyar (and that includes Ubud) are really tightening up on property development.  In fact there was a big meeting in Gianyar just two weeks ago with all the heads of villages in Gianyar (over 600 of them) and the key note speaker was my cousin (a full professor/doctor) who delivered an address basically intended to educate his audience on the consequences of selling off Bali's land. 

New restrictions will soon be implemented here in Gianyar Regency including a total moratorium on any sort of villa, commercial or hotel building on current sawah lands.

Moreover the push here includes refusing to sell land outright to other than non Balinese Indonesians.  Free hold ownership is being replaced by leasing, even to other Indonesians.  The idea is that with a lease eventually the land (and its heritage for which it stands) will come back to the Balinese family, and ancestors will be pleased with that outcome. 

Frankly I am pleased with these changes beyond words.  My wife and I both want something of the same Bali for our boys that we had when raising them.  A whole lot of Balinese feel the same way.  Land is vital to Balinese culture and preserving it should be of key concern. 

You are coming to the game in the “third quarter” regardless of where in Bali you want to pursue your idea.  The mood here overall is that Bali is already bursting at the seams and far too much unacceptable pressure on the local Balinese culture has already occurred.

To be honest I am totally against foreign development of land for profit on Bali.  Foreigners who want a private house in which to live is one thing…foreigners who want to exploit Bali's most valuable resource is quite another. 

Nothing personal here…just my views which are being embraced by more and more Balinese each and every day.

Selamat Pagi Pak
Saya guru bahasa Indonesia dari Perth, Australia dan saya mengajari anak-anak di SD.  Saya sudah tinggal di Missouri, America pada tahun 2001-2004. 
My Indonesian is so rusty now because I don't get enough opportunities to converse with Indonesian adults but I love my job nonetheless.
Pak I would very much like to retire to Bali and continue teaching on a voluntary basis although it will not be for several years yet.  However, I would like to start researching the possibility now.
I am coming to Bali in July, 2014 during the school break and I was wondering whether you would allow me to visit you as you seem so knowledgeable about this subject?
Salam Hangat.

July seems like ages from now.  There are two universities in the US sending over large groups of students that I will be involved with that month.  Also, the daughter of close friends in California will be here doing some volunteer teaching at an NGO that I work with.  As she will be staying with us we will be very involved with her as well.  On top of that we are planning for additional certification for our three boys with John Huxley of Eco Dive in Amed this July. 

In short, July is going to be nutty month for us, but I'd be happy to meet you for a coffee and chat if you plan on being in the Ubud area.

Send me a PM once you are here and I'll reply with my phone number.

(Moderated: Please post in the section housing in Bali)

Terima kasih banyak Pak.  Ya, suami saya dan saya akan datang ke Ubud sesudah mengunjungi Pulau Menjangan.  Saya akan blog Pak kalau kami dekat Ubud dan jika Pak bisa dijumpi kita bisa bertemu dan minum kopi.
Does that make sense?      Thank you for taking time out from your very busy schedule.  I will contact you again when we are close to Ubud and if you are able, it would be lovely to meet for coffee.
Salam Hangat

Property prices often quoted in US Dollars  and excessively high in my opinion. Might be interesting to lease some land and build your own place.

"Property prices often quoted in US Dollars  and excessively high in my opinion."

Actually property prices here are most often expressed in IDR, and not dollars.  As for being excessively high, it's all about what the market will bear, and for certain, land prices all over Bali have sky rocketed in recent years.

In my own village, land which used to sell, Balinese to Balinese for 30 to 40 million an are is now going for 350 to 400 million an are...Balinese to Balinese. 

Some folks say this is an arbitrary bubble, but the fact is that each year waves upon waves of new expats arrive, all looking to lease and build.

give me a an email [email protected], I will try and help you

Ubudian wrote:

"Property prices often quoted in US Dollars  and excessively high in my opinion."

Actually property prices here are most often expressed in IDR, and not dollars..

Anything priced in Dollars is aimed at foreigners, so the price will probably be far higher than anything aimed at the local market.
Sadly, foreigners with more cash than they have clues, will force prices higher and higher, removing most locals from the market.
This is where I have to support the Indonesian law that excludes foreigners from buying land in this country.

The laws governing foreign ownership of property are clear, and both these links pretty much explain the laws:

http://www.bali-information.com/Indones … ership.phphttp://www.baliproperty.com/own_property.html

I totally agree about not allowing foreigners to buy freehold property in Bali otherwise within a short number of years most of Bali would probably be owned by rich foreigners and the already high prices would sky rocket. Then, Bali would become a completely different place with every Tom, Dick or Harry starting their own business and changing the very nature of this island paradise.

However, it is interesting to note that other countries in the region such as Singapore and Malaysia allow Indonesians, including Balinese, to purchase property in their countries, and Malaysia allows any foreigner to purchase landed property or apartments as long as the cost is RM1 million (Rp. 3.5 Milyar) or above.

Malaysia and Bali and to a lesser extent Thailand have non-xenophobic governments comprising officials that recognize the value that retirees bring to the country.

For most of Malaysia under My Second Home program the threshold lies with RM 500'000. Popular areas like Penang & Kl and I think now Johore the threshold for foreign purchases is like the aforementioned poster said RM 1'000'000.

This supports the local building industry and offshoots. Does not prevent strong-arming by the government, though. Just look at UMNO moving on Setia Berhad, but I digress...

Singapore has also instituted impediments through financial measures. Has cooled down the market somewhat and is I think the best way to influence prices - Though I strongly dislike government intervention in the markets.

Hi all. I am new to this forum. Finding this thread very interesting and helpful.
I live in Hong Kong, however my wife is Javanese and we love Bali. So in tbe future we might consider buying land or a small house there.
So my questions is, given that we do have the indonesian prenup, does she have the full property rights of an Indonesian citizen or is she in any way restricted in her right because she married a foreigner?
Also, does it make a difference if we buy property in Bali and she is not Balinese but Javanese? I read in an earlier post that it could at least make a difference in some districts of Bali in the future, namely in Ubud.

Hi modo
Balinese or javanese or lombok they are indonesian citizen so no problem to buy land or property.
But in your case depend if you signed a contract before you marry to separe all properties.
If no she can not buy because you can not own 50% of this property.

There is an increasing trend in some of the villages that make up Ubud to only sell local land to local Balinese and use lease arrangements with all other non locals including other non local Balinese, Indonesian and foreigners.

Hey,  I am planning to go through  all this process  but I want to make sure I don't screwed  over.
Can you tell me a bit about your experience  please?

Hi, all.
Once you build a villa in Bali, i believe that taxes are payable on completion and to be paid every 3 years. Is this correct?

4748jim wrote:

Hi, all.
Once you build a villa in Bali, i believe that taxes are payable on completion and to be paid every 3 years. Is this correct?

Impressive introduction for a first time poster....

Thanks Happyhour. Good to be a part of Expat.com.

How about you tell a little more about yourself, your story etc ??

It will make a good impression to long time members here and easier to get response from others.

To answer the question about real estate taxes, in Bali they are paid every year, at the end of the year.  The tax is paid to the appropriate regency tax office, and it's based on their assessment of the value of the land and the structures built upon the land, as well as the use of the land...agriculture, residential, commercial.  The tax rates are consistent by regency, but obviously there are considerable variations of values of land (and structures) from one regency to another.

Compared to places in the US where I have lived, and owned property, the real estate taxes here are modest.

Hi Matt MY name is vic ive got a villa in jimbaban and also own land in west bali,its easy to own land and villa in bali,if u are still not sure get back to me vic

vicwas wrote:

Hi Matt MY name is vic ive got a villa in jimbaban and also own land in west bali,its easy to own land and villa in bali,if u are still not sure get back to me vic

Foreigners can not own land / properties in Indonesia...

Thus it is NOT easy to own land and villa as what you say here.

Totally agree with happyour,YES ,it's not easy to own land and villas in Bali

Karim, what I actually wanted to say is......it's not possible.

vicwas is a part owner according to his profile.

stumpy wrote:

vicwas is a part owner according to his profile.

I do not check profiles only what people post and if you read it, it's just not correct.

"vicwas is a part owner according to his profile."

Unless he's "converted" and has become an Indonesian citizen, it ain't his name on the Hak Milik...so he ain't no land owner!   

Ubudian wrote:

"vicwas is a part owner according to his profile."

Unless he's "converted" and has become an Indonesian citizen, it ain't his name on the Hak Milik...so he ain't no land owner!   

Perhaps that's the case Roy....I did not think about it 

Hi Happyhour.
We are currently building a villa in Canggu, it seems everyone has a different view regarding taxes etc. this also appears to be normal for Bali. I guess time will tell. our plan is to retire there early next year, we are in process of obtaining Kitas etc.

Canggu is a good choice.  It's one of the few areas down south where all the land hasn't already been paved over and developed.  With land conservation and preservation becoming an increasingly important issue for the Balinese, there is a chance that some parts of Canggu will remain undeveloped. 

" it seems everyone has a different view regarding taxes etc."

Not really.  The only view that matters is the view held by the Kantor Pajak (tax office) for each Regency. That's the view you need to know.   

Thanks for the advise Ubudian, it has given me something to work on.

Hi.  Thanks for the great info in this thread.  I have the dreaded nominee contract with a local in Lombok.  I have known them for years now, and know many of the locals and expats in the area, and feel quite comfortable.  At this stage it's the norm in Lombok.  However I am wondering if it is possible to change a nominee agreement into Hak Pakai for security?  If so, how would I go about it?
Thanks

Just a little “heads up” or “hati hati” in Bali, the government is going after nominee arrangements as an illegal way of trying to circumvent tax payments.

In Lombok…who knows (for now).

According to a recent government release, only about 25% of the Indonesian population that should be paying taxes, are paying them.  The new government is "hell bent" on changing that...and for foreigners involved with locals where the local hasn't paid the tax...they are coming to see you...sooner or later.

Thanks Ubudian.  Yes I saw the article in Bali Discovery.  So no idea about converting to Hak Pakai at this late stage?  I will check that my nominees have paid their taxes.
Cheers

Converting to a hak pakai lease will be entirely up to your current nominee.  If he or she is willing, then you and your nominee need to meet with a notaris and see how much it will cost to set up the hak pakai.  You might also think about what incentive might be needed to persuade your nominee to go along with this change.

Good luck!

Hello Matt,
My husband and I lived in Bali for two years, and while there we purchased a villa.  You would have to use a nominee, and also a notary. ( we could provide you with both, if need be).  We have returned to Canada, as that is where we are from, and are selling our villa, in Bali, if you are interested. 
We have paid all the taxes, and are also up to date with the Banjar and the Sabah. 

Frae