How Foreigners Can Legally Own Property in Bali in 2026 – Leasehold, PT PMA, and Land Rights Explained

Buying property in Bali, Indonesia as a foreigner in 2026 is absolutely possible; but only if you follow Indonesia’s land laws and avoid shortcuts like nominee schemes. Foreign buyers must work with specific legal rights (Hak Pakai, Hak Sewa, HGB) and structures such as a PT PMA company to secure villas, land, or apartments safely and compliantly.

What Foreigners Can and Cannot Own in Bali

Indonesian agrarian law still reserves Hak Milik (Freehold) land ownership for Indonesian citizens and certain local entities, which means a foreign individual cannot legally own freehold land in Bali in their personal name.

Instead, foreigners use these main legal routes:

Hak Pakai (Right to Use). Allows a foreigner or foreign‑owned entity to use land for residential or commercial purposes for up to a total of around 70–80 years via initial grant and extensions (often structured as 30 + 20 + 30 years).
Hak Sewa (Right to Lease / Leasehold). A long‑term lease agreement (commonly 25–30 years, sometimes longer) between the owner of Hak Milik and a foreign individual or entity, often with extension clauses.
Hak Guna Bangunan (HGB – Right to Build). A right normally held by companies, especially PT PMA (foreign investment companies), that allows construction and ownership of buildings on land for up to 30 years, extendable and renewable for decades (often up to 80 years total).

Flats/apartments can also be owned through specific strata‑title type rights (Hak Milik atas Satuan Rumah Susun / similar), but foreigners must still comply with the underlying land and foreign‑ownership regulations.

Leasehold vs Freehold in Bali (From a Foreign Investor’s Perspective)

Because Hak Milik is not available to foreigners directly, the real comparison for most international buyers is leasehold vs controlling freehold via a PT PMA.

Key points:

Leasehold (Hak Sewa).
- Typically 25–35 years, often with agreed extension options.
- 30–50% cheaper than equivalent freehold in the same area, and more straightforward for individual foreign buyers.
- Suits investors focused on short‑ to mid‑term ROI rather than multi‑generational ownership.
Freehold (Hak Milik) held by locals / PT PMA holding HGB.
- True Hak Milik title can only sit with Indonesian citizens, but a PT PMA can legally hold land under HGB and own buildings for long‑term commercial use.
- Offers stronger control, easier scaling of projects and simpler inheritance/exit through share transfers of the company.
- Higher setup and maintenance costs, plus corporate compliance obligations.

Specialist guides in 2025–2026 emphasise that leasehold can deliver very attractive yields at lower entry cost, while PT PMA + HGB is better for larger, long‑term developments and serious portfolio builders. balivillarealty

Using a PT PMA to Own Property in Bali

A PT PMA (Perseroan Terbatas Penanaman Modal Asing) is a foreign‑owned limited liability company that can legally hold land and buildings for investment and business in Indonesia.

Core features:

A PT PMA can acquire land under HGB (Right to Build) or sometimes Hak Pakai, allowing legal control of land and improvements for 30 years, extendable and renewable (commonly up to 80 years).
The company, not the individual, is the legal landholder; the foreign investor controls the asset through share ownership, which also makes resale via share transfer more efficient.
PT PMA status allows you to legally run a rental or hospitality business (villas, hotels, restaurants) within the scope of its licensed activities.

A typical PT PMA must have at least two shareholders, a director and a commissioner, obtain investment and business licenses (e.g., via BKPM / OSS), and maintain regular corporate reporting and tax compliance. For many foreign investors planning multiple villas or a branded operation, the PT PMA route is considered the most robust medium‑to‑long‑term structure.

Why You Must Avoid Nominee Structures in Bali

Academic and legal studies from Bali repeatedly warn about the use of nominee agreements, where a foreigner informally “owns” Hak Milik land through an Indonesian individual acting as a front.

Key issues:

Nominee arrangements conflict with the Basic Agrarian Law and can be deemed void, leaving the foreigner without enforceable rights if a dispute arises.
They contribute to gentrification and social tension by pushing land prices beyond local affordability, and are therefore increasingly scrutinised by regulators.
Courts have, in various cases, prioritised the formal Indonesian title holder over the foreign beneficial owner, underscoring the risk.

Current 2025–2026 guidance from legal and investment specialists strongly recommends using leasehold, Hak Pakai or PT PMA + HGB rather than nominee schemes in order to maintain legal certainty and protect capital.

FAQs: Foreigners Owning Property in Bali in 2026

Q1: Can foreigners own freehold (Hak Milik) land in Bali?
No. Indonesian law reserves Hak Milik for Indonesian citizens and eligible local entities, so foreigners cannot directly hold freehold land in their personal name.

Q2: What legal options do foreigners have to buy property in Bali?
The main options are Hak Sewa (leasehold), Hak Pakai (Right to Use) and HGB (Right to Build) via a PT PMA, plus regulated strata‑type rights for certain apartments or flats.

Q3: Is leasehold in Bali safe for foreign investors?
Properly drafted leasehold agreements, passed through a reputable notary and registered against valid land certificates and zoning, are widely used and legally recognised; due diligence is essential.

Q4: Why do many investors set up a PT PMA?
A PT PMA can legally hold land under HGB, own buildings, and operate rental or hospitality businesses, giving foreign investors long‑term control, better scalability and cleaner exit strategies via share transfers.

Q5: How long can a foreigner control land with Hak Pakai or HGB?
Hak Pakai and HGB are generally granted for an initial period (often around 30 years) and can be extended and renewed, with total control potential commonly reaching 70–80 years, subject to approvals and compliance.

Q6: Are nominee agreements a good shortcut to freehold ownership?
No. Nominee schemes are risky and contrary to the spirit of Indonesian land law; research highlights that they offer weak legal protection and contribute to regulatory and social problems in Bali.

Q7: Can foreigners own apartments or condos in Bali?
Yes, but subject to specific regulations on flat/strata rights and zoning; foreigners typically hold units via rights compatible with foreign ownership rather than pure Hak Milik land titles.

Q8: What due diligence steps are essential before buying?
Verify the land certificate with BPN, confirm zoning (RTRW), check building permits (IMB/PBG or PBG), ensure the seller’s legal authority, and use an independent notary and legal adviser experienced with foreign buyers.

Q9: Does a PT PMA fully replace personal tax and legal obligations?
No. A PT PMA is a separate legal entity with its own tax and reporting requirements; foreign shareholders still have personal tax and compliance obligations in Indonesia and their home country.

Q10: What is the safest overall structure for a first‑time foreign buyer?
Most first‑time investors choose either a well‑drafted leasehold on prime land or a PT PMA holding HGB for larger, business‑oriented projects, always avoiding nominee setups and relying on professional legal and tax advice.

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How Foreigners Can Legally Own Property in Bali? Leasehold, PT PMA, and Land Rights Explained