There are several special regulations made by Indonesia for ownership, both for citizens and foreigners. The rule is made to give benefits for both parties, namely the state and investors. However, there are some rules that you must know if you choose land for sale in Bali. It is because there are two options, namely buying rental property or property rights. Check out this information!

About the Property in Bali

Foreigners get the right to own property rights documents. It is the most sought-after option and demanded by foreigners. Although they have to use an Indonesian entity or nominee as a land certificate holder, this is illegal under Indonesian law. In addition, it relates to defense regulations for the purchase of property in Indonesia by foreigners.
When you are deciding whether to buy freehold land or lease rights, you should be aware of the consequences of each of these rules. It is also related to the potential value of the investment you choose. When choosing whether to purchase freehold land or leasehold land for sale, you should be aware of the consequences of each concerning the potential value of the investment.

Property Ownership Rules

1. Freehold or Ownership

To get big profits, investors often buy Freehold land rights. It allows you to enjoy profits overtime at a high price increase. With freehold, any appreciation in the value of the property that is undergoing repairs will give you a significant advantage in the investment. With this in mind, you can get the benefit in easy ways.
Hak Milik is the strongest and most comprehensive form of land ownership certificate in Indonesia. Only Indonesian nationals can obtain and have a Freehold certificate. However, this results in limited companies (PT) or foreigners being unable to obtain a Hak Milik land for sale certificate. Freeholds are unrestricted and can be sold, even inherited, and can be used in the form of a mortgage.

2. Right of Use

As is well known, foreigners cannot use Hak Milik or Freehold certificates as proof of property. They can only obtain land under a Hak Milik certificate in another form, namely the Hak Use. It allows foreign parties to get legal recognition and benefits in owning property in Indonesia, especially in Bali.

3. Bali Leasehold

On the other hand, there is Rent which means after a certain period the property and any repairs return to the owner. In simple terms, your investment in rental property depreciates, as the lease becomes less attractive to buyers. Terms and conditions land for sale extension of lease by a foreigner usually evidenced in the original agreement.

If you decide to purchase a lease, prepare the lease agreement with the help of a third-party legal advisor. It is essential to guarantee renewal and limit rent increases to be cost-effective. Also, the lease agreement or contract must be documented at the PPAT notary for due diligence on the property. As a result, all documentation has met the requirements under applicable law.