Due Diligence Part 3: get to know your legal options – leasehold
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Due Diligence Part 3: get to know your legal options – leasehold
Defining your payment terms for extensions is a safer way to go on long leasehold property options in Bali.
This article is intended as a preliminary guide only and refers to some but not all elements required to consider in detail prior to starting any property dealings or due diligence. Property dealings are often complex, especially in foreign countries and we highly recommend you seek independent professional advice... read more...
In the first two parts on Due Diligence, I talked about getting to know your agent and the neighborhood of where you'd like to buy a property in Bali.
Today, we're going to take the next step.
Let's assume you're happy with the agent; the neighbourhood is perfect for you and your young family, close to schools and shops; and you're in love with something you really want to buy. So are the kids, by the way!
Before we begin, let me state that I am not a lawyer and don’t intend to give legal advice here. What I'm saying comes from observations of actual cases we have witnessed at Exotiq Property over the past 15 years. We advise all our clients to seek professional legal assistance and we're more than happy to put you in touch with those we trust and have had good experiences with.
Let's get started.
Being a foreigner you have several options to legally own a property in Bali – or in fact anywhere in Indonesia.
The simplest form of ownership is leasehold.
Here the law is pretty easy to understand: all you need to show the transacting notary on the day of signing the deed is a valid passport with a valid visa for Indonesia. This can be any kind of visa, tourist, social, business, or permanent stay. And please note you have the right to own as many leasehold properties as your money can buy.
The trickier parts about leasehold are the terms or the extensions thereof.
Typically, leasehold terms in Bali vary between 25 to 30-years. They can be shorter and they can be longer. I have seen anything up to 99-year lease terms.
Is that legal?
Well, I am told that the law doesn’t stipulate a minimum nor a maximum term for leasehold. So this is all back to jurisprudence or the interpretation of the law and its intentions. And that's where we have different views as you might expect.
Let me say this, I am not aware of any leasehold being challenged in court because it was deemed to be for too long of a term.
Similar to this:
Due Diligence Part 1: know your agent and save yourself a lot of trouble
Due Diligence Part 2: get to know your property and neighborhood
This article and the above linked articles are not complete and are intended as preliminary guides only. These guides refer to some elements to consider prior to starting any property dealings or due diligence. Property dealings are often complex areas, especially in foreign countries and we highly recommend you seek independent professional advice... read more...
Dominique Gallmann
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