With its stunning beaches, tropical climate, and relaxed way of life, Bali is a prime location for Australians looking to invest in property. However, buying property in Bali as a foreigner requires navigating a legal landscape that differs significantly from Australian property laws.
Leasehold vs Freehold: Understanding Your Options
Foreigners in Bali are not permitted to own freehold property. Instead, the most common route for Australians is to purchase property under a leasehold agreement. A leasehold allows you to lease the land for a set period, typically between 25 and 99 years, with the possibility of renewal.
Although some Australians attempt to use nominee structures—where an Indonesian national holds the freehold title on their behalf—this is legally risky. Nominee agreements do not provide adequate legal protection, and disputes with the nominee could lead to the loss of your investment.
Leasehold offers a safer, more straightforward path. Make sure to work with a notary to draft a lease agreement that includes provisions for renewal and protects your interests.
Hiring a Notary for Legal Representation
One of the most important steps when buying property in Bali is hiring a local notary. The notary will ensure that the property is free of legal disputes and that the seller has the legal right to sell or lease the property. They will also help ensure that all paperwork is in order, including land titles and lease agreements.
Notaries in Indonesia play a similar role to solicitors in Australia. They are responsible for conducting legal checks and ensuring that the transaction is above board.
Property Management and Rentals
If you’re purchasing a property for rental income, hiring a local property manager can help you maintain the property and manage tenants. Bali’s thriving tourist industry makes it an ideal location for short-term vacation rentals, but property management can be time-consuming, especially if you’re not based in Bali year-round.
A property manager can handle everything from tenant check-ins to maintenance, making your investment more manageable and stress-free.
Buying property in Bali requires careful consideration and legal guidance, but with the right approach, it can be a rewarding investment for Australians.
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Send us an email to find out more, hello@balirealestate.com.au.
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