Step-by-Step Guide: Buying Your First Villa in Bali

Can Foreigners Buy Property in Bali?

Yes — but not through direct freehold ownership. Indonesian law (Undang-Undang Pokok Agraria) prohibits foreigners from owning land with Hak Milik (freehold) title. However, foreign buyers have two well-established legal pathways to own property in Bali:

1. Leasehold (Hak Sewa) — A long-term lease agreement (typically 25-30 years with extension options) directly with the landowner. Simpler, more affordable, and the most common choice for villa buyers.
2. PT PMA (Foreign-Owned Company) — Establish an Indonesian company with foreign ownership that can hold Hak Pakai (Right to Use) title. More complex and expensive (~$170K USD minimum capital) but provides stronger legal standing and full control.

Step 1: Define Your Goals

Before you start browsing properties, clarify your objectives:

• Personal use: Holiday home? Retirement villa? Leasehold is usually sufficient.
• Rental investment: Airbnb income? You'll need a Pondok Wisata rental licence.
• Business use: Running a hospitality business? PT PMA is the way to go.
• Budget: Villas range from $100K to $600K USD. Land from $60K.

Step 2: Choose Your Area

Each area in Bali has a different character, price point, and investment profile. Here's a quick comparison:

Step 3: Find & Verify Properties

This is where most buyers face the biggest risk. Bali's property market is largely informal — many listings don't have proper documentation, and scams targeting foreign buyers are not uncommon.

At Horizon Bali Property, we address this with:

• AI-powered discovery: RUDI monitors 247 Telegram groups 24/7, finding properties before they hit the open market.
• 8-point document verification: Every property we list has been checked for SHM, lease agreements, PBB tax receipts, building permits, and zoning.
• Personal assistant in Bali: Kristine personally inspects each property and coordinates with landowners.

Step 4: Due Diligence

Never skip due diligence. Our in-house legal team conducts thorough checks including:

• Land certificate (SHM) verification at BPN (National Land Agency)
• Zoning confirmation (ITR) — ensuring the land is zoned for your intended use
• Building permit (PBG/IMB) verification
• Tax payment history (PBB)
• Ownership chain verification
• Encumbrance and dispute checks

Cost: IDR 15,000,000 (~$950 USD) for Gianyar, Badung, or Denpasar areas. Timeline: 14 working days.

Step 5: Negotiate & Sign

Key points during negotiation:

• Prices are almost always negotiable — 10-20% off asking is common
• Agree on what's included (furniture, fixtures, staff contracts)
• For leasehold: negotiate extension terms upfront (e.g., 25+25 years)
• Deposit is typically 10% to secure the property
• All agreements should be notarised (Akta Notaris)

Step 6: Complete the Purchase

Final steps:

1. Lease agreement drafted by notary (or PT PMA setup if that route)
2. Full payment — typically by international bank transfer
3. Notarisation and registration
4. Handover — keys, documents, staff introductions

Costs to Budget For

Tax Considerations

Most countries require you to declare worldwide income, including rental income from overseas property. Indonesia has Double Tax Treaties with many countries to prevent double taxation. We recommend consulting a tax advisor familiar with overseas property in your home jurisdiction.

Read our Tax Guide for Foreign Property Owners →