Buying Villa in Bali with Confidence

Freehold vs Leasehold Property in Indonesia

Ownership, Legal Terms, and How We Support You

Buying property in Indonesia does not need to be complicated.
It only becomes difficult when things are unclear or structured incorrectly.

This guide explains, in plain language:

  • Freehold vs Leasehold ownership

  • The key Indonesian terms you will see during purchase

  • How rental income is handled legally

  • How we support you from start to finish

What Is Already Done (So You Are Not Taking Early Risk)

Before any villa is offered to buyers, we complete the critical legal and permitting work.

This means you are not buying into uncertainty.

Already completed:

✓ Zoning is confirmed and approved
✓ Land is legally subdivided
✓ PBG (building approval) is issued
✓ Legal rental pathway is in place (hotel / accommodation KBLI)
✓ SLF is in progress and finalized near completion
✓ Initial due diligence has already been completed

How Buying a Villa With Us Works

Step 1: Choose Your Villa and Ownership Type

We confirm whether your villa is Freehold or Leasehold and align it with your goals:

  • Personal use

  • Rental income

  • Or both

Step 2: Receive the Buyer Document Pack

You receive a clear summary of all key documents, including:

  • Land subdivision

  • Zoning confirmation

  • PBG documentation

  • SLF status and timing

  • Rental licensing pathway

No hidden steps. No missing information.

Step 3: Notary Setup

We introduce a trusted notary (PPAT) who prepares and explains all transaction documents.

Step 4: Payments and Legal Transfer

Payments follow the agreed schedule.
The notary handles all formal transfer and government filings.

Step 5: Handover and Rentals (If Applicable)

We coordinate handover.
If you plan to rent, we align the villa with a lawful accommodation structure.

Ownership Options Explained Simply

Freehold Villas (For Eligible Buyers)

Some villas are available as Freehold, subject to Indonesian law.

What Freehold Means

The strongest ownership title in Indonesia is SHM (Hak Milik).
It is generally available to Indonesian citizens.

In some cases, Freehold land can be upgraded to SHM through the notary and land office.

Why Buyers Choose Freehold

  • Long-term ownership security

  • Ideal for legacy or family ownership

  • Easier resale to Indonesian buyers

Leasehold Villas (Most Common for Foreign Buyers)

Leasehold is the most practical and widely used structure for foreign buyers.

What Leasehold Means

You receive the legal right to use and control the property for a long, fixed period.
Extension terms are clearly written into the contract.

When drafted correctly, Leasehold provides strong protection and control.

Why Buyers Choose Leasehold

  • Clean and accepted structure for foreigners

  • Faster and simpler process

  • Clear extension and resale options

Rental Income: How It Works Legally

If you want rental income, the villa must operate under the correct license.

We already have a hotel / accommodation KBLI in place.
This allows the villas to be rented legally under Indonesian law.

Why this matters:

  • The license must match actual use

  • It reduces operational risk

  • It protects your investment

PT PMA (Optional for Foreign Buyers)

Some foreign buyers choose to set up a PT PMA (foreign-owned Indonesian company).

You may want a PT PMA if you:

  • Prefer a company structure

  • Plan long-term rental operations

  • Want clearer administration and accounting

What a PT PMA Is

A PT PMA is an Indonesian company that can be owned by foreigners and licensed to operate specific business activities.

How Setup Works

  • Choose the correct business activity (KBLI)

  • Notary prepares company documents

  • Government registrations are completed

  • Ongoing compliance is set up if required

We introduce qualified consultants (such as Celerity) to handle this properly and quote accurately.

Key Indonesian Terms (Plain English)

PBG – Building Approval

Government approval to build a specific design on a specific plot.

Why it matters:
It confirms the project is legally approved.

SLF – Certificate Fit for Use

Confirms the completed building is safe and ready to be used.

Why it matters:
Required for lawful operation and rentals.

KBLI – Business Activity Code

Defines what a company is legally allowed to do.

Why it matters:
Rental villas must operate under a hotel / accommodation KBLI.

Notary / PPAT

The legal authority who prepares and registers property transfers.

Why it matters:
All clean property transactions go through a notary.

How We Support You

We guide you through the entire process and coordinate trusted professionals, including:

  • Licensing and compliance consultants

  • Notary (PPAT) referrals

  • Optional tax, legal, and rental support

You stay in control.
We provide clarity, structure, and coordination.

What You Will Receive as a Buyer

✓ Confirmation of Freehold or Leasehold
✓ Land subdivision documents
✓ Zoning confirmation
✓ PBG documentation
✓ SLF status and timing
✓ Rental licensing pathway summary
✓ Clear payment schedule and handover terms

Disclaimer

This page provides general information only and is not legal advice.
Ownership structures depend on the buyer profile and specific unit.
We coordinate qualified professionals for all legal and compliance steps.