How to buy Villa in Bali

How to buy Villa in Bali

Bali is different compared to other places in Indonesia, both culturally and demographically.

With many foreigners going to Bali for vacation or to reside there, a common question is whether regulations to foreign ownership is different as well.

In fact, regulations don’t differ much, except for the limit set to the height of the building that can be constructed.

Normally, a building can’t be taller than 3-4 levels (15 meters). One of the tallest buildings, Grand Bali Beach Hotel, was built in the 60’s and reach 10 floors, as it managed to avoid the new regulations.

Freehold vs leasehold

In total, you have two options when buying a villa or other property:

  • Buying a property with a freehold title
  • Buying a property with a leasehold title

So what are the differences and benefits between these two? Let’s have a look:

Buying a freehold property

Although risky, most foreigners want to buy property with a freehold title, as this gives a feeling of more freedom and higher price appreciations.

So why is this risky?

As explained in my separate guide about buying property in Indonesia,foreigners can’t buy and directly own freehold property. This is against Indonesian laws.

Still, there are ways for you to buy and indirectly control freehold property, through local contractual setups.

You need to assign an Indonesian corporation or individual (so called nominee, or representative) as the owner of the title, which means you’re not protected.

Pros with buying freehold is that you’ll experience a bigger price appreciation, freehold property is in big demand and it will always be attractive. A leasehold property will lose its attractiveness the closer you get to the expiry date.

Buying a leasehold property

Going for a leasehold property means that you won’t need to put up that much money, but you’ll have more limitations in the usage of the property.

Also, the value of the physical structure won’t increase as much as the freehold ditto, which is in a bigger demand among foreigners.

You’ll also miss out on the price appreciation of the land itself, something that “owners” of freehold property can enjoy.

Where should I buy property in Bali?

Even if you’ve visited Bali before, it’s not always easy to know where you should invest in property.

Below, I’ve included some of the most popular places where foreigners tend to buy.

Sanur

Located along a 5 km long coastline at the Southeast parts of Bali, Sanur is a bit overlooked and more relaxed compared to other areas.

You’ll find many restaurants, bars and meet more locals as the streets are not overcrowded by foreign tourists.

Sanur property prices

The price of a 3 bedroom freehold villa usually starts at USD 400,000 and continue upwards.

Canggu

With a coastline that’s twice as long as Sanur’s, Canggu is located in the Southern parts of Bali. It’s one of the most popular places for property buyers and travelers.

Similar to Sanur, Canggu is fairly relaxed with many cafes, it’s also popular among surfers.

With a beautiful landscape with rice paddies, many foreign expats decide to buy villas here.

Canggu property prices

The price of a 3 bedroom freehold villa starts at around USD 750,000.

Ubud

Ubud is one of the oldest areas in Bali that becomes increasingly popular. It’s located in the mountains, where the weather is cooler. You’ll find temples and

It’s famous for having a relaxed lifestyle, but also an abundant local culture with many arts.

Ubud property prices

The price of a 3 bedroom freehold villa usually starts at USD 250,000-300,000.

Kuta

Kuta beach is probably the most popular area for resort travelers, especially among Australians. It’s located in the Western parts of Bali and a stone’s throw away from Ngurah Rai international airport.

If you go to Kuta, you’ll find everything from shopping, bars and many restaurants.

Kuta property prices

A 3 bedroom freehold villa usually starts at USD 300,000.

Seminyak

Seminyak is located a bit north of Kuta and the place to be if you have deeper pockets. Previously an undeveloped and sleepy area, it’s now the most upscale area in Bali.

Seminyak is more relaxed compared to Kuta, you’ll find less surfers in this area.

Seminyak property prices

The price of a 3 bedroom freehold villa usually starts at around USD 500,000.

Other places with growth potentials the coming years

  • Nusa Lembongan Island
  • Lombok and the Gili Islands
  • Tanah Lot, and other areas on the coast further north

Real estate agents

As one of the most popular resorts for travelers in the world, it’s not strange that Bali has many real estate agencies to choose between.

Some of the most popular real estate agencies include:

  • Ray White Property Group
  • PPBali
  • Sevenstonesindonesia
  • Villabalisale

Real estate commissions usually land at 5%.

Conclusion

Bali is one of the most visited resort islands in the world and attract tons of visitors from worldwide.

Foreigners can’t own freehold property, but some still decide to indirectly own freehold property through local contractual setups. You should keep in mind that you won’t be protected if you decide to go for this option.

Prices have increased much the past 10-15 years, especially in the luxury segment and for vacant land. Due to hefty increases, the prices have stagnated.

Some of the most popular areas to buy property in Bali include: Sanur, Uduk, Canggu, Kuta and Seminyak, all offering different lifestyles.

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