While the Covid-19 pandemic limited the operations of international flights globally, Lombok’s tourism sector maintained a 20% y-o-y growth, with over a million tourists observed in 2020. Moreover, the Indonesian government’s efforts to develop Lombok’s infrastructure like the construction of a new international airport and several resorts acted as a catalyst to boost the tourism scene on the island.
Lombok presents a lucrative property investment prospect for foreign investors, as it is considered to be the fastest-growing tourism spot in Indonesia with a large part of it still underdeveloped.
In this article, we will discuss various aspects of buying land in Lombok as a foreigner and things to be aware of while investing.
Why Foreign Investors Should Buying Land in Lombok
Following are the reasons why investing in Lombok is profitable for foreign investors:
- Indonesia welcomed 16 million tourists in 2019, with Bali attracting over a third of them. As a result, the government is inclined towards attracting tourists to other islands, wherein Lombok features prominently on its “10 New Balis” blueprint.
- Situated between Bali and Komodo Island, Lombok is endowed with magnificent natural beauty, peaceful beaches, and one of the planet’s most striking climbs, Mount Rinjani.
- As Bali suffers from over-tourism, Lombok, an alternative to Bali, is poised to offer cheap and lucrative property investment opportunities.
- Compared to steep land prices in Bali, USD 1000 per sq. meter, Lombok’s land prices are very reasonable, being USD 230 per sq. meter.
- After the development of Lombok’s most popular destinations along the north-western coastline, the southern coast witnessed large-scale development with the USD 3 billion Mandalika Project, and the new international airport in Praya.
The culmination of the above points makes investing in Lombok an ideal opportunity for foreign investors.
Things To Consider While Buying a Land in Lombok
Who is the Owner of The Land?
Ensure the rightful owner of the land by confirming their valid land certificates and inheritance documents.
Duly confirm if all the taxes are paid by the previous owner, as unpaid taxes could keep them from obtaining a building permit (Izin Mendirikan Bangunan).
Make sure that the purchased land lies in a commercial zone, as some zones prohibit commercial activities.
Acquire a building permit IMB (Izin Mendirikan Bangunan) and ensure compliance with the zoning law before building on the purchased land. Otherwise, the building will be prone to demolition by law.
Land Infrastructure and Border
Double check the actual size of the bought land, confirm the legal accessibility of the linking road, and eradicate the possibility of any boundary overlapping to avoid any dispute with neighbors in the future.
Limited Property Access
At the time of buying, foreigners must make sure that they possess the right to use the road linked to the property, and are not subjected to future disputes or charges.
Sales and Purchase Agreement
Conduct the transaction in the form of a Sales and Purchase Agreement (SPA), signed by both the parties involved. The SPA requires a valid document, like a Marital Agreement, or Prenup or Postnuptial document, and these must be lodged at the land registry office for further proceedings.
Buying Land in Lombok Securely with Cekindo
It is essential to have a clear understanding of land acquisitions and investing in Lombok. Cekindo offers quality due diligence that will help you gain insights into the land values and potential issues, giving you confidence in making a final decision for closing the deal.
Furthermore, Cekindo provides the necessary information and guides you through all the steps of the Business Investment Process like preparing a list of potential investments, and analyzing the shortlisted investment. Cekindo will assist you in setting up your land and property investment plan in the most secure way.