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Buying Land and Property in Indonesia for Foreigners

Property Ownership and Buying Land in Indonesia

Indonesia is Asia’s next big opportunity and one of the fastest-growing among the G-20 countries. Indonesia’s construction market was valued at $267 billion at 2015, currently the largest economy in Southeast Asia and the fourth biggest in Asia after China ($1.78 trillion), Japan ($742 billion) and India (427 billion). In 2016, the construction market projected to grow 14.26 percent, or about Rp 446 trillion.

Indonesia is a developing country with a wide range of business opportunities for beneficial investment. It also has characteristics that can frustrate investors and harm the investment climate. Such as the often-mentioned government corruption and regulation of ownership of foreign investment.

House Ownership of Foreigners Residing in Indonesia

Property ownership in Indonesia by CekindoAs part of efforts to boost Indonesia’s economy, the current Indonesian Government had released a regulation that signed by President Jokowi (Government Regulation No. 103/2015 on House Ownership of Foreigners Residing in Indonesia) to allows foreigners or expats living in Indonesia to own land and houses in Indonesia (find out the complete guide for foreigners to buy and own property in Indonesia).

According to Government Regulation No. 103/2015 on House Ownership of Foreigners Residing in Indonesia, it allows foreigners who reside (legally) in Indonesia to own landed houses in Indonesia for a period up to 80 years.

The regulation informed that an expat can buy a landed house in Indonesia under the right-of-use category for an initial period of 30 years. After this period, he can extend the ownership twice, once by another period of 30 years and then by a 20-year period, hence foreign ownership can reach a total of 80 years.

Regarding the price, it depends on the specific rules per zone. In the capital city of Jakarta, for example, a foreigner can only buy a landed house that has a price tag of least IDR 10 billion (approx. USD $700,000). For apartments in Jakarta the price tag needs to be at least IDR 5 billion.

Price Mechanism for Foreign Ownership of Landed Houses and Apartments in Indonesia

Zone  Landed House Apartment
Minimum value that can be purchased by foreigner Minimum value that can be purchased by foreigner
Jakarta IDR 10 billion IDR 5 billion
Banten, West Java IDR 5 billion IDR 2 billion
East Java IDR 5 billion IDR 1.5 billion
Bali IDR 3 billion IDR 2 billion
Central Java, Yogyakarta IDR 3 billion IDR 1 billion
NTB, North Sumatra, East Kalimantan, South Sulawesi IDR 2 billion IDR 1 billion
Other Regions IDR 1 billion IDR 750 million

The price mechanism was taken from attachment of government regulation no.13 year 2016.

Cekindo will professionally arrange the most suitable and safety plan for your land property ownership investment in Indonesia

Foreigners Can Also Lose the Right to Own Land and Apartments

When the foreigners or their heirs move to another country and no longer stay in Indonesia within one year, they have to relinquish or transfer the ownership rights to someone who meets all the requirements to own the land in Indonesia.

If the ownership is not relinquished within one year after the foreigners leave Indonesia, consequently the Indonesian government will seize the land regarding the government regulation No. 103/2015.

You don’t have to worry, cause Cekindo will assist you to keep your land and property investment safe in Indonesia.

Renting the Property

According to the government regulation No. 103/2015, foreigners have no right to rent their land and property in Indonesia as individual. But Cekindo can help you to find a perfect solution for this problem. Foreigners can rent their property through a local company.

Cekindo will assist you to establish a suitable company in Indonesia. So you are not only renting your property, but you can also do another business activity through this form of company.

Property & Land Ownership: The Business Investment

Cekindo Provides The Necessary Information And Guides You Through All The Steps Of The Business Investment Process Below:

  • Prepare a list of potential investments based on your requirements. We have local knowledge about the scope of investment opportunities (find out the updated negative investment list). That includes information about local master plans as well as public and private projects. Which including new roads, airports, business centers, etc. These are important issues that will impact the value of your investment in the future.
  • Provide analysis for shortlisted investments. Your selected projects will be investigated and we will perform a detailed analysis to ensure all required parameters.
  • Conduct local negotiation to start up the investment. We will help you locally negotiate and purchase the target of your investment. We check and ensure the authenticity of all documents.
  • Manage your ownership. Individual foreign ownership of land is prohibited in Indonesia. To own property, foreign investors are required to buy it through a business entity. Cekindo can help you to set up a company in Indonesia.

Cekindo will assist you in setting up your land and property investment plan in the most secure way. Feel free to contact us for a free quotation on investing in land and property ownership in Indonesia.

Fill out the contact form and we’ll get back to you with a quote and an overview of the process customized for your industry.

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