Buying Property In Bali: Ultimate Guide
Have you ever considered buying property in Bali?
Maybe you’ve just had a fantastic holiday in Bali and are now seriously considering buying property here.
Or maybe Bali has been on your radar of places to move too, and now you are considering moving here.
Why not after all?
So many people just like yourself have done it, which means it definitely is possible for you to do as well, if you are a foreigner or not.
Indeed, the good news is that you can well and truly own property in Bali as a foreigner!
The less exciting news is that it is not as simple as buying property in your home country.
That’s why it’s in your best interest to understand the ins and outs of buying property successfully in Bali.
This guide will guide you along the different steps of this journey so that you are sure to properly invest your hard-earned money!
Why buy property in Bali?
Let’s be real. Bali is a dream!
The main reason many people are attracted to buying a property in Bali is because of the amazing lifestyle that the island offers!
Fun fact, Bali is called the Island of the Gods! Not so surprising now that this island has so much to offer!
Indeed, if we take a step back, where else can you live in such grand style - getting professional help with your kids and your housekeeping, having a chef to cook your favorite meals and entertain your guests and not to forget the driver to do your groceries and drive your kids from home to school?
Even having a pool is not even an option, it’s for granted!
Besides the great lifestyle that Bali offers, you also have the option to get a solid return on your investment by renting it out when you are not living in it yourself.
Bali is busy 365 days a year and renting your villa to tourists from all over the world is very simple and attainable due to the high demands for rental properties.
If you need help with renting your property, there are plenty of companies that can help you out!
Last but not least, there is also a growing demand for property in Bali and prices are not likely to go down anytime soon!
On the contrary, property prices have appreciated over the past decades in a way few other markets have.
So, if you buy right, your Bali property might well become the best investment of your life!
Where to buy property in Bali
If you are set on buying property in Bali, you might be wondering where to buy property in the first place.
To answer this question, you need to ask yourself a few questions first.
Indeed, the answer will depend if the property is for personal use or as an investment.
Let’s say you want to buy property on the island to live in for yourself. To do so, you need to imagine your life in Bali beforehand in order to decide which area you would like to live in, whether that be in Seminyak, Canggu, Ubud or on the coast.
Another important question is whether you have kids that need to go to school. If that’s the case you want to make sure that commuting from home to school is practical and is not going to eat up your day.
There are multiple international schools here on the Island, and I suggest that you visit them one by one and then decide which one is right for your kids.
Once that question is answered, I suggest finding a property within no more than 30 minutes driving distance. If you don’t have to worry about schooling for your kids, you will have more options to decide where to buy.
Let’s talk about a few common locations foreigners like to live in.
Sanur has been and remains a popular area for expats to live in and has great infrastructure.
This means you are not going to face any annoying traffic jams compared to other areas! In Sanur, there are also many star hotels to hang out in, the ocean promenade is beautiful and there are enough restaurants and “warungs” to explore before you get bored any time soon!
It’s good to note that property prices are still reasonable in Sanur and the surrounding areas.
Canggu nowadays is clearly the hot shot area of Bali!
It’s the village of choice for hundreds of digital nomads, home to Bali’s trendiest cafes, vegan restaurants and stylish co-working places.
This is where some of Bali’s most famous beach clubs, like Finns, La Brisa, Café del Mar, and so many more are located.
Canggu has everything you need and sometimes more than wanted as traffic has become a bit of an issue!
If you are considering choosing Canggu as a place to live and don’t have a fixed requirement to be within walking distance to your favorite café, then I recommend you choose a location that is a bit further away from the beach in a quieter location in Canggu.
Consider places like Kaba2, Nyambu, Nyanyi, or even Tanah Lot and beyond, where land prices are a lot more affordable than in Canggu’s busy center.
Concerning the real estate prices in Canggu, we believe here at Exotiq that they are reaching a peak and will start to flatten out soon.
Seminyak and neighboring “Petitenget” is still the place for chic dining and well-known beachfront hotels like the W, Alila, The Oberoi and more.
Take note that in Seminyak, the traffic isn’t as bad as in Canggu but can still be relatively busy at times.
Seminyak’s village is also well developed and mature and has some of Bali’s most iconic villas!
There is also a sizable expat community living there if you wish to meet others from outside Bali.
If you are into shopping, shopping choices are very good in Seminyak and will please the shopping enthusiasts.
It also takes no more than 30 minutes to reach Seminyak from Bali’s international airport.
This makes Seminyak a great choice, If you are commuting to other cities in Indonesia or Southeast Asia.
Ubud has long been a favorite of the art and spiritual community and has attracted a colorful and vibrant expat community.
It has a huge choice of restaurants and shops, art galleries and hip cafes and is home to international events like the Bali’s readers festival and more.
If you have the privilege (And luck) to find a property along one of Ubud’s famous rivers, you have nailed it!
Just make sure that you have proper access rights before you buy it.
Take note that Ubud has a slightly cooler climate than the coastal areas of Bali and which makes air conditioning optional compared to other areas that are hotter and “stuffier” where air conditioning is more than recommended.
But, of course, with cooler temperatures comes more rain which is something to take into consideration.
Concerning driving distance to the airport, it’s about an hour and still manageable if you are a frequent traveler.
The Bukit (the hill, in English) or Bali’s southernmost tip is another very popular destination, famous for its stunning cliff fronts and white sand beaches.
It is a dry patch of land up there and is famous for its surf conditions and nightlife.
Concerning the property market, there is still a lot of empty land on the Bukit at various prices, depending on the view or the remoteness of the plot.
Its proximity to the airport is noteworthy and attractive, but it’s good to take into consideration that there is less infrastructure when it comes to schools, restaurants and shopping than in the other locations mentioned above.
There are many more places here in Bali, where you might want to invest or live, feel free to check out our living in Bali guide to learn more.
Also, if you have a specific location in mind, feel free to contact us to know more about property prices and opportunities. We know the island very well and would be happy to help out!
What types of property to buy in Bali
Now that you have decided on the area you are going to buy your home in, you may be asking what types of property you can buy?
As you may have guessed, villas are the prime property type developed here in Bali.
It’s because of villas that Bali was brought onto the international property map in the first place!
It all started with a few expats leasing land in Seminyak and Ubud, where they developed what came to be known as private villas; uniquely designed Bali style compounds, typically on large estates, with swimming pools, tropical gardens, Balinese art and statues, the mandatory Bale (or gazebo), water features and eclectic furniture.
Various coffee table books appeared documenting Bali’s emerging tropical architecture and inspired so many more to come and explore the famous island living.
Since then, land has become more expensive and harder to buy.
Also, what used to be a villa then, has now shrunk to a much smaller size property – but it’s still called a villa as the same features defining a villa are present.
If you are interested in purchasing a villa, feel free to check out our villa listings for sale all across Bali.
Apartments never really made a big splash on Bali’s shores as that was simply not the dream for most visitors coming from crowded cities, escaping their small apartments in Hong Kong, Singapore or Tokyo.
That’s why there are only a few upmarket condominium developments in Bali until today.
If ever you have in mind to purchase an apartment, feel free to take a look at our apartment listings for sale in Bali.
More recently, “Joglos” became sought after.
A Joglo is a traditional wooden house from Central Java made out of four tall central poles supporting a vaulted ceiling with ornate inner beams, sometimes intrinsically carved and decorated and belonging to the aristocratic tradition.
Made out of teakwood, these amazing structures have become popular but also very expensive…
Some creative minds have built entire complexes with Joglos!
It’s noteworthy to note that the tiny house movement hasn’t really reached Bali yet as land is still relatively affordable and there is no need to reduce the property size to the max.
However, with rising land prices, some developers have designed fancy townhouses, particularly in Canggu, where most people want to live.
These townhouses sell in the tune of $100.000 - $200.000 and are becoming more and more popular.
If you are considering going for this solution feel free to check out our large choice of townhouse listings in Bali!
For those that come to Bali to invest, there is also the option to purchase Hotels & Resorts in Bali.
As mentioned above, due to the high influx of tourists, this can be a great option to maximize your property returns as these types of property often perform very well but grants are hard to find & costly!
If your pockets are bigger, take a look at our hotels & resort listing for Sale in Bali.
If ever you can’t find the property you are looking for (Or if it simply doesn’t exist), you may have to opt for Plan B and buy a piece of land and build your own dream home in Bali !
Building in a foreign country can be tricky and isn’t recommended as a first option unless you are a builder by profession and know the ins and outs of a building project.
If you are considering this option, feel free to look at our land parcels for sale in Bali.
What is the cost of property in Bali
Answering this question is similar to answering the question: how long is a piece of string?
Well it depends…
Indeed, it’s all about location.
This old real estate mantra is true in Bali as it is anywhere in the world!
And what makes a location desired and hence expensive?
Well proximity to the beach, to the airport, restaurants, shopping, natural and cultural attractions, schools…etc
The most expensive real estate in Bali is on Bukit's western sunset cliff and on the beach in Seminyak and Canggu.
Here is an example.
A beachfront piece of land in Canggu may cost as much as $1500 - per square meter.
But if you were to move inland and 10 km away from the coast. Now, the square meter costs only $150!
If you were to move another 20 km inland, now you would be looking at $15,- per square meter.
As you can see, beachfront property is always the most expensive real estate in Bali.
Of course, the added benefit is that you can’t go wrong when buying beachfront land.
It will never decrease in price! NEVER!
Just make sure that your piece of dream land is large enough to build on it. The general setback rule from high tide is a 100 m distance.
Bali ownership titles
Let’s talk about Bali ownership titles.
This is where things get confusing and are often misunderstood by most (Which is understandable).
What title you qualify to buy depends on your nationality, your legal status and your residential permit.
The titles you should know about are:
- Freehold (‘Hak Milik’ in Balinese)
- Leasehold (‘Hak Sewa’ in Balinese),
- Right to build (‘Hak Guna Bangunan’ in Balinese)
- Right to use (‘Hak Guna Pakai’ in Balinese).
Let’s go over each one of these briefly.
Freehold title or ‘Hak Milik’
In Indonesia, and therefore in Bali, foreigners don’t qualify to buy freehold (‘Hak Milik’) property.
Only Indonesian citizens may own freehold titles!
Not even a domestically owned company can own a ‘Hak Milik’ title.
It is that simple and there is nothing to do to get around this!
Leasehold title or ‘Hak Sewa’
The leasehold title is very popular in Bali but isn’t very well known in other parts of Indonesia.
It is the only title a foreigner can buy if his stay permit is based on either a tourist visa or another short-term visa type.
A leasehold title, is typically offered by an Balinese freehold owner, who wishes to keep his freehold title intact but is happy to part with his land for a certain fixed duration, the leasehold term.
This is typically around 20 – 30 years and carries a clause that regulates a possible extension of the term.
The leasehold title is acquired by making a payment at the signing of the lease agreement, typically for the entire term, sometimes for part of the term only with subsequent fixed payments in the future.
During the leasehold term, the foreigner is free to build on the land as long as he or she follows the building code and gets the required permit. At the end of the lease term, all fixed structures that are not removable, fall back to the Balinese landowner.
Right of Use title or ‘Hak Pakai’
The “right of use” title is very interesting, especially for foreigners that have a long stay permit under a Kitas/Kitap or a retirement visa.
This title allows the foreigner to hold a title in his name that is then converted from freehold to right of use.
The interesting part is that when selling the right of use title, the property can be converted back to a freehold title if the buyer is Indonesian.
In that manner, one participates indirectly in the appreciation of the freehold title, even without owning it.
A ‘Hak Pakai’ title comes with an initial validity of 30 years and can be extended for another 20 years against payment of a fee to the government.
Once the 50 years are over, the title can be renewed for another 30 years and extended by 20 years, like in the first round.
And this can go on multiple times.
Right to Build title or ‘Hak Guna Bangunan’
The title “right to build” acts very much like the above described right of use title, but typically applies for companies established under Indonesian law.
This may be an entirely foreign owned company or a domestic one in Indonesia.
Now that we have an overview of the upfront work involved in searching for a property, let’s cover the buying process in detail.
Indeed, it is indispensable to have an idea of the entire buying process, its duration, the various steps, tasks and the costs associated with each step, from start to the end.
Remember, don’t rush things and don’t let anyone rush you!
Do each step properly and you will be happy with the outcome at the end of the buying process!
Step 1# - Start with your budget
First of all let’s start by identifying your budget.
The budget is the big limiting factor and you need to stick to it, as you won’t be able to secure finance from commercial lenders being a foreigner buying in Bali.
This is important to keep in mind, as many forget they won’t have access to financing here in Bali.
This is why you should make sure to set the limit of what you are willing and able to commit to right from the beginning.
Your budget should also allow for costs associated with the buying process, namely, notary fees up to 1%, stamp duty (5% for ‘Hak Pakai’) and lawyer fees, if you decide you need one to guide you through the due diligence process.
Step 2# - Determine your needs & wants
Having an initial wish list is a helpful tool.
Try to differentiate between what you really need and what would be nice to have.
Usually, a compromise will have to be found to make ends meet.
In our experience, your initial brief will change quite substantially once you have visited a few listings and get more familiar with different locations.
This is why we recommend to keep your ideas open to start with, and to fine tune your needs & wants as you visit more properties.
Step #3 - Find a real estate agent
Finding a real estate agent is certainly one of the most important factors in the entire process!
You need to find an agent that you can trust and who has the experience under his hood to guide you safely through the entire buying journey process.
Take a look round, interview a few agents and go with your gut feeling and recommendations from previous clients if you have any.
Here at Exotiq we are trusted Balinese real estate experts with over 20 years of experience here in Bali and know our way round the market like the back of our hand.
We would be very happy to help you find a gem property that fits your needs.
Unlike other agents, we align our incentives with yours so that you truly find the best property even if it takes some time!
Step 4# - Visit listings & perform due diligence
Here is where the fun starts. This part involves all the driving around and looking at properties.
You will learn a lot and soon realize that your original brief is changing quite a bit after having seen a few properties.
At this stage, you need to do some initial due diligence with the support of your agent.
Find out more about the neighborhood, gather more info on where your dream property is located.
- What is the access like?
- Is it private or public?
- How well is the property built?
- Is it worth calling a building inspector to check the roof and make sure there are no termites?
- What is the reason for the owner to sell?
- Is there a rental performance that the owner is willing to share with you?
All these questions are crucial to doing a successful due diligence process.
If you are currently at this stage feel free to check out our property listings in Bali.
Step 5# - Negotiate & close the sale
Once you know as much as possible about the property, you need to assess the value of it, in order to prepare your offer!
Your agent should be guiding you very closely at this stage.
What kind of recent sales in the area have been transacted is an important question to ask your agent.
For context, in Bali, property negotiations are usually started some 10% below the asking price. (This of course is if the asking price is indeed realistic and not inflated).
As a general rule, expect to meet the seller in the middle!
Step 6# Conclude the transaction
Now that your offer and your terms have been accepted, it is crucial to sign the sale and purchase agreement in the most detailed and clear way possible.
This is the role of your agent! They should heavily assist you here!
Normally, a 10% deposit is due upon signing the agreement with the deposit being held by the notary or the agent.
After that, you have around 30 days to conduct legal due diligence and make sure all the paperwork is kosher and clean.
This is the job of the notary or of your lawyer.
All once all this is done and checked, the final payment is due and the property becomes yours.
Well done, you are now an owner on the island of the gods!
Buying property as a foreigner
Last of all, let’s quickly cover the challenges of buying property in Bali as a foreigner, which is the case of most people looking to buy in Bali.
So as you can guess, buying in Bali as a foreigner has its challenges. It is well and truly possible, but it has its technicalities.
As mentioned above, one main technicality is that as a foreigner you don’t qualify to buy freehold property!
Indeed, as a non-resident of Indonesia, you can buy leasehold titles and a special title created for foreigners, called ‘right of use’ or ‘hak pakai’ in Bahasa Indonesia in order to buy property.
Next, if you plan on buying and living here, you will need of course a visa to stay here in Bali.
The type of visa you have will depend on your personal situation.
Feel free to check out our guide on moving to Bali for extra details on how to go about things.
Next, the most important point to keep in mind over key cornerstones of the buying process is that you are operating in a foreign environment with its own rules, a language you may not fully understand but above all a culture that sometimes says ‘yes’ when it really means ‘no’...
Faced with these challenges, what should you do?
Well, this is where having an experienced guide you can trust and who acts on your behalf with your best interests in mind is extremely useful!
Perhaps your best option may be to work with a friend who has done it before and knows the rules. That can be an option.
The main idea to keep in mind is that you shouldn’t cut any corners!
Use professionals when it comes to legal contracts, building inspections and property knowhow.
This is where a local real estate agent is extremely useful!
Here in Bali, property agents are normally paid by the vendor and represent the vendor and his or her interests.
This is not an ideal situation for you, the buyer.
Here at Exotiq we have come up with a solution!
As a buyer you can engage the services of a buyer’s real estate agent that acts for yourself and gets paid by yourself.
This avoids the typical conflicts of interest that dominate the Bali property market, where agents work with the sellers to inflate prices.
Exotiq Property is the first agency in Bali to introduce exclusive buyer’s agency services.
Do your bank account a favor and check out the benefits of this service before you go any further in your buying journey.
Interested in buying property in Bali?
In this guide we have covered all the ins and outs of buying property in Bali.
As you can see, Bali’s real estate market isn’t the simplest of landscapes to navigate but is attainable to everyone, even foreigners!
Now that you know exactly what to expect when searching to buy, you need to take the first step and talk to a qualified and experienced agent which can help you get your feet wet in Bali’s market.
Feel free to look at our listed properties and get in touch so we can help you along your journey in finding your golden gem!