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HOW TO BUY / INVEST A PROPERTY IN INDONESIA FOR FOREIGNER?

Make a Foreign Owned Company


(PMA)

 Prepare company name (minimum three words)


 Business activity of the company
 Prepare company address
 Minimum investment value 10 billion rupiah. Tobe exact 25% of this – 2,5 billion rupiah
needs to be paid up capital
 Repare structure of shareholder, directors and commissioners. PT PMA is required to have at
least 2 local shareholders (individual /legal entity), 1 director and 1 commissioner
 Shareholder documents requirement

Notes:

It is possible for a foreigner to serve as the director of a PMA. However, before doing so, the director
of the PMA must first have obtained a work permit which is valid in Indonesia.

To prove that such an amount exists, the PMA can deposit all of it as paid-up capital or send a
financial balance sheet of the total amount to any relevant authorities. The amount of capital will be
stated in the Deed of Establishment and confirmed by a notary. The paid-up capital can be used to
pay for employees salaries, operational fees, product costs, or any other necessary business
expenses.

PMA could buy a property as company assets and could be inherited / re-sell.

Individual Ownership

Hak Pakai (HP)

Hak Pakai is the ‘right-to-use’ title and can be received from a person who owns the Hak Milik
(freehold title). By having a Hak Pakai title, you can construct residential property on the land that is
owned by the person having the Hak Milik title.

The lease term is set for 25 years and can be renewed for a maximum period of 80 years.

Worth mentioning: If you get hold of a Hak Pakai as an individual, you need to reside in Indonesia,
or have Indonesia as your domicile. In this case, you need to apply for a KITAP (permanent stay
permit) or a KITAS (temporary/limited stay permit) to keep the title.

Hak Pakai is one of the strongest titles and you’re allowed to sell and transfer the title to another
person who’s eligible to own the title in Indonesia.
So, here are several requirements and consequences for foreigners who own property in Indonesia,
and it has been stipulated in Regulation 29 as follows:

1. There is a set fixed minimum price for the property per region.
2. The property can only purchase property in Indonesia directly from the developer (also can
be purchased from second-hand sellers with certain criteria).
3. Foreigners and their families are only allowed to have a maximum of one property.
4. Limited to a maximum of 2000 Sqm land size (for houses).
5. Property can be mortgaged in a bank or Indonesian financial institution.
6. Must maintain their stay permit visa during their property ownership period.
7. When leaving Indonesia, the foreigner must release or transfer the Right of Use to another
person who meets all requirements to own property in Indonesia (this can be another
foreigner or an Indonesian citizen) within one year after his or her departure from Indonesia.
8. Foreigners can buy a house in Indonesia for an initial period of 30 years, which can be
extended by another period of 20 years and then can be renewed for another 30 years.
Minimum Price for a Minimum Price for
Location of Province House Apartment

DKI Jakarta Rp10.000.000.000,- Rp3.000.000.000,-

Banten Rp5.000.000.000,- Rp2.000.000.000,-

West Java Rp5.000.000.000,- Rp1.000.000.000,-

Central Java Rp3.000.000.000,- Rp1.000.000.000,-

Yogyakarta Rp3.000.000.000,- Rp1.000.000.000,-

East Java Rp5.000.000.000,- Rp1.500.000.000,-

Bali Rp5.000.000.000,- Rp2.000.000.000,-

West Nusa Tenggara Rp3.000.000.000,- Rp1.000.000.000,-

North Sumatera Rp3.000.000.000,- Rp1.000.000.000,-

East Kalimantan Rp2.000.000.000,- Rp1.000.000.000,-

South Sulawesi Rp2.000.000.000,- Rp1.000.000.000,-

Other Provinces Rp1.000.000.000,- Rp750.000.000,-