Leasehold vs Freehold in Bali: property for foreigners explained (2026)

Three regimes, three different uses

Several property regimes coexist in Indonesia. Foreigners have access to only three of them, and each addresses a different use case.

Summary of the regimes accessible to foreigners in Bali.

Regime	Who	Term	What for
Hak Milik (freehold)	Indonesian citizens only	Permanent	Pure ownership
Hak Sewa (leasehold)	Foreigners	25–30 renewable years	Investment / second home
Hak Pakai (use)	Residents with KITAS	30 years + extensions	Primary residence
PT PMA (company)	Indonesian company with foreign capital	Indefinite (company lifetime)	Business operations over assets

Regime Hak Milik (freehold)

Who Indonesian citizens only

Term Permanent

What for Pure ownership

Regime Hak Sewa (leasehold)

Who Foreigners

Term 25–30 renewable years

What for Investment / second home

Regime Hak Pakai (use)

Who Residents with KITAS

Term 30 years + extensions

What for Primary residence

Regime PT PMA (company)

Who Indonesian company with foreign capital

Term Indefinite (company lifetime)

What for Business operations over assets

Hak Sewa: the foreign investor’s main tool

Leasehold is a personal right over a property for a defined term, paid in advance. It is not ownership, but it offers enough control to run a holiday rental villa, a home or a business for decades.

25–30 Typical years

100% Paid in advance

0 Nationality restrictions

2 Typical renewals

PT PMA: when leasehold isn’t enough

If your plan is to operate several assets, generate local revenue, hire staff or acquire land use under a legal entity, the route is to set up a PT PMA (Indonesian company with foreign capital). We cover it in the guide to setting up a company in Indonesia, where you’ll find minimum capital, timeframes and taxes updated to 2026.

How we handle it with you

Choosing the right regime is the first step of the investment; the numbers it produces, you’ll see in the real yield guide, and the full picture in the Bali investment hub.

Support resources for your arrival

These are some external services you will definitely need. We don’t list them for money — we use the same ones.

Wise

Essential

EUR → IDR transfers at the real exchange rate, with no hidden fees. Essential for moving the villa deposit or paying the notary.

Visitar

Revolut

Card and app for daily spending in Bali. Good for small expenses, bad for large transfers.

Visitar

IATI Seguros

Solid travel insurance for stays of up to 3 months during the search and due diligence phase.

Visitar

SafetyWing

Monthly international health insurance subscription. Useful once you're already operating from Indonesia.

Visitar

Frequently asked questions

Can I buy a villa outright (hak milik) as a foreigner?

No. Hak milik (freehold) is reserved for Indonesian citizens. Foreigners operate through leasehold or through a PT PMA.

What happens when the leasehold ends?

Whatever the contract says. The usual option includes a pre-agreed renewal with predefined terms. Without that clause, the property reverts to the landowner.

Is a leasehold an inheritable asset?

Yes. The personal right over the property is inherited like any other asset, within the remaining term of the contract. It should be reflected in an international will to avoid friction.

What if I want to sell the leasehold before it expires?

It is transferable. The new holder takes on the remaining term. The price adjusts downward as the remaining time of use decreases.