Townhouse 2BR in Canggu
Canggu · 2 bedrooms
Rp 4.716.464.393
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Leasehold vs Freehold in Bali and Indonesia (2026): Who Can Own
Freehold (Hak Milik) is for Indonesians only. A foreigner takes a leasehold (Oct 2026 median IDR 4.0B vs 8.1B freehold), Hak Pakai, or HGB through a PT PMA.
Published 21 September 2026 · Updated 29 October 2026 · Rules checked 13 October 2026 · 17 min read
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Leasehold vs freehold at a glance
The two are different things, not two grades of the same thing. Freehold is a permanent registered title to the land; a leasehold is a contract to use someone else's land for a fixed number of years. Most of what separates them in price, resale and risk follows from that. Title is what the land certificate says; contract is what you agreed with the seller. Almost every confusing Bali listing mixes the two.
| Leasehold (Hak Sewa) | Freehold (Hak Milik) | |
|---|---|---|
| Who can hold it | Anyone, foreigners included, by notarial deed | Indonesian citizens only (UUPA art 21) |
| How long | The years in the deed; a median 26 years over 744 partner listings for sale on 18 October 2026 | Permanent |
| What it is | A contract with the landowner | A title registered at the land office (BPN) |
| Median asking price, homes for sale, 18 October 2026 | IDR 4.0 billion, over 742 listings | IDR 8.1 billion, over 143 listings |
| Share of homes for sale that state a tenure | 84% (760 of 905) | 16% (145 of 905) |
| At the end | Land and building return to the owner unless the deed gives an extension | Nothing ends |
| Selling it on | Only the years left, and only if the deed allows assignment | The land itself |
| Mortgage | No registered mortgage (Hak Tanggungan) over a lease | Yes, for an Indonesian holder |
| Acquisition duty (BPHTB) | Not charged: a lease is not a registered right | Up to 5% of the price, after the regency threshold |
| What decides its value | Years remaining, the extension clause, the right to sublet and assign | Location, size, zoning and access |
Property for sale in Canggu
See all 198 →- About the same as the median price of 20 similar leasehold 2-bd homes in Canggu (±30% size, lease 19.5–32.5 yrs): Rp 4.754.000.000.
Villa 4BR in Canggu
Canggu · 4 bedrooms
6% below the median price of 8 similar leasehold 4-bd homes in Canggu (±50% size, lease 16.5–27.5 yrs): Rp 8.692.000.000.Rp 8.163.111.449
Villa 2BR in Canggu
Berawa · 2 bedrooms
22% below the median price of 20 similar leasehold 2-bd villas in Canggu (±30% size, lease 19.5–32.5 yrs): Rp 4.844.500.000.Rp 3.791.311.762
Which structure fits which foreign buyer
If the villa is a holiday home you will not rent out, a leasehold is the normal answer; a leasehold can also be let through a PT PMA if the deed allows subletting. If you live in Bali on a KITAS or KITAP and want the house registered in your own name, Hak Pakai is built for exactly that, but it is for residence, not for letting. If the villa is a business, with nightly rentals, several units and staff, the route is a PT PMA holding Hak Guna Bangunan, with the cost of running a company every year.
What leasehold and freehold cost in each area
Median asking prices of homes for sale, finished and off-plan, listed by Baliestate's partner agencies on 18 October 2026, with the number of listings behind each. A median over fewer than 10 listings is not shown. The two columns are rarely the same house: in Pererenan the median freehold home for sale stands on 296 m² of land with four bedrooms, the median leasehold on 126 m² with two; in Canggu, where both sit on about 155 m² with two bedrooms, the medians are level.
Compare a leasehold by its price per year left. Across Bali the median leasehold for sale asked IDR 150 million per year of its stated term, over the 729 that state both a price and a term. A year of lease cost most in Canggu, IDR 190 million, and least in Nusa Dua and Seseh, under IDR 100 million; Seseh's leases were also the shortest, a median 18 years. The area pages and the price index recompute these medians every hour.
| Area | Leasehold median | Leasehold per year of term (median term) | Freehold median |
|---|---|---|---|
| Canggu | IDR 4.8 billion (164) | IDR 190 million (25 years, 161) | IDR 4.7 billion (40) |
| Uluwatu | IDR 4.2 billion (222) | IDR 151 million (27 years, 220) | IDR 7.5 billion (42) |
| Tabanan | IDR 4.4 billion (67) | IDR 146 million (27 years, 66) | IDR 13.4 billion (24) |
| Pererenan | IDR 3.8 billion (31) | IDR 165 million (25 years, 30) | IDR 15.2 billion (16) |
| Ubud | IDR 3.8 billion (90) | IDR 137 million (29 years, 90) | – |
| Sanur | IDR 3.5 billion (41) | IDR 116 million (30 years, 40) | – |
| Nusa Dua | IDR 2.9 billion (28) | IDR 96 million (30 years, 28) | – |
| Seminyak | IDR 2.7 billion (27) | IDR 146 million (24 years, 27) | – |
| Seseh | IDR 2.6 billion (40) | IDR 98 million (18 years, 37) | – |
The four land titles, and who can hold each
A Bali buyer meets four titles. Three are rights registered at the land office (BPN, the National Land Agency) and evidenced by a certificate. The fourth, a lease, is a contract with the landowner and is not a land title at all. A foreigner can hold one registered right in their own name, Hak Pakai, with a residence permit, and one through a company, HGB held by a PT PMA. A lease needs neither.
| Title | Who can hold it | How long | Registered at BPN? | Legal basis |
|---|---|---|---|---|
| Hak Milik (freehold) | Indonesian citizens only, plus legal entities the government designates | Permanent | Yes, with a certificate | UUPA arts 20–21 |
| Hak Guna Bangunan (HGB, right to build) | Indonesian citizens and companies set up under Indonesian law, including a PT PMA; not foreign individuals | 30 years, extendable by 20, renewable by 30 | Yes, certificate in the holder's name | UUPA art 36; PP 18/2021 arts 34 and 37 |
| Hak Pakai (right to use) | Indonesian citizens and entities, and foreigners domiciled in Indonesia | Over state land 30 + 20 + 30 years; over Hak Milik land, set by the grant deed and commonly reported at up to 30 years | Yes, registered to the holder | UUPA art 42; PP 18/2021 arts 49–53 |
| Hak Sewa (lease) | Anyone, by contract with the landowner | Whatever the deed says; Bali leases are typically 25–30 years | No: a notarial deed, not a land title | UUPA arts 44–45; Civil Code arts 1548–1600 |
Leasehold: buying time, and the clause that decides its value
A leasehold buys the right to use the land and whatever stands on it for a fixed term. The land keeps its Indonesian owner; at the end of the term the land and the building go back to them unless the deed says otherwise. That is not a defect, it is the deal, and it is why a leasehold villa costs a fraction of the same house on freehold land.
Two numbers decide what a leasehold is worth: the years remaining and the extension terms. In partner listings on 6 October 2026, completed leasehold villas with under 20 years left asked a median IDR 26.8 million per m² of building, against IDR 31.1 million for 25–30 years: about 14% cheaper for a third fewer years, so per year of use the short lease was the most expensive way to buy time. An extension agreed in the original deed, with a price or a formula, is worth a great deal. An extension to be negotiated 'at the time' is worth nothing, because by then the owner knows exactly what the house is worth to you. Article 1576 of the Civil Code carries an existing lease over to a new landowner if the land is sold, but it protects the term already agreed, not an extension option you have not exercised.
Land is leased the same way: by notarial deed, for a fixed term, with the building you put up returning to the landowner at the end unless the deed says otherwise. Of the 142 plots partner agencies listed on 18 October 2026 that state a tenure, 105 were leasehold, with a median term of 25 years; the land guide covers zoning, access and what the deed must allow before you build.
- Read the years remaining, not the years originally granted: a 30-year lease sold in its ninth year is a 21-year asset.
- Divide the asking price by the years remaining before comparing two leaseholds.
- Check the extension price is fixed or formula-based. 'To be agreed' is not a term.
- Check you may sublet and assign. Without both you cannot rent the villa out or sell the rest of the lease.
Hak Pakai: the home in your own name, while you live here
Hak Pakai is a registered right to use land, available to a foreigner domiciled in Indonesia with a valid KITAS or KITAP. Over state land, PP 18/2021 sets an initial 30 years, a 20-year extension and a 30-year renewal, up to 80 years. Over land still held as Hak Milik by an Indonesian owner it is granted by a registered agreement, and its term is set by that agreement.
Two conditions decide whether it suits you. It is for residence, so it does not carry commercial letting. And it depends on your residence permit: stop qualifying and you have one year to transfer the right to someone who does. A minimum purchase price for a house owned by a foreigner, IDR 5 billion in Bali under ATR/BPN Ministerial Decree 1241/SK-HK.02/IX/2022, also rules it out for cheaper villas; the threshold is set by decree and can change, so confirm the current figure with the notary.
HGB through a PT PMA: when the villa is a business
A PT PMA is an Indonesian limited company with foreign shareholders. It can hold Hak Guna Bangunan for 30 years, extendable by 20 and renewable by 30 under PP 18/2021, and it can hold the business licences a rental villa needs. The price is the company itself: minimum capital (IDR 2.5 billion paid up per business line under BKPM Regulation 5/2025, against an investment plan above IDR 10 billion), an accountant, monthly and annual tax filings and licences, whether or not the villa earns anything that year. For one villa used a few weeks a year that cost rarely pays; for a rental business it is the structure that makes the income lawful.
Freehold land is listed far above leasehold for the same building because it is permanent. For a foreigner that premium buys nothing directly: you reach freehold land only through a PT PMA, which converts it to HGB, or by leasing it from its owner. So compare like with like: a leasehold's price per year remaining against what the company route costs to buy into and to run for the same number of years, including land-office conversion, company set-up and the buyer's acquisition duty.
Why 'freehold for foreigners' is a nominee, and why it fails
A nominee arrangement puts an Indonesian citizen's name on a Hak Milik certificate while side agreements (a loan, a power of attorney, a statement of debt) promise the foreign buyer control. Article 26(2) of the Basic Agrarian Law voids any arrangement that passes ownership of Hak Milik to a foreigner, directly or indirectly, and where these structures have been tested the person on the certificate has been treated as the owner.
Bali's Perda 4/2026 on controlling productive land conversion and prohibiting nominee land ownership, signed by Governor Wayan Koster on 24 February 2026, adds a provincial prohibition. DNT Lawyers, quoting its text, places the ban on brokering a nominee arrangement in Article 14 and the sanctions in Article 20: administrative sanctions (permit revocation, demolition, restoring the land, fines), with criminal liability left to national law. Much coverage, and earlier versions of this guide, said the Perda carries up to five years' imprisonment and an IDR 1 billion fine; we could not source that. Those figures match Article 72(1) of Law 41/2009 on protecting sustainable food farmland, a national offence about land use, and a regional regulation cannot set them itself: Article 15 of Law 12/2011 caps a Perda's own penalties, and Law 1/2026, in force since 2 January 2026, leaves regional regulations with fines only, as Hukumonline reads it. We could not find the Perda's full text on jdih.baliprov.go.id or peraturan.bpk.go.id on 13 October 2026, so its wording is reported here, not read by us.
If a listing says 'freehold' and the buyer is a foreigner, ask whose name goes on the certificate. Any answer other than yours, your company's or a lease in your name is the problem.
Four things you will hear, checked
- 'Freehold is safe if the nominee is family or a trusted partner.' The arrangement is void under Article 26(2) of the Basic Agrarian Law whoever the nominee is.
- 'It is a 99-year lease.' Indonesian law sets no maximum term for a lease, but a lease is only as good as the landowner's title and the deed. A long term from someone whose title you have not checked is a long promise, not ownership.
- 'If the owner sells the land, the lease ends.' It does not, unless the lease says so: Article 1576 of the Civil Code keeps an existing lease in force against a new owner.
- 'Hak Pakai lets me rent the house out.' It is granted for residence. A villa that earns rent belongs in a PT PMA holding HGB, with the business licences that needs.
Taxes and fees at their statutory rates
These are the rates national law sets. Each regency fixes its own BPHTB and PBB rate and tax-free threshold within the national ceiling, so ask the notary for the local figure before you budget. The notary's fee is a ceiling on a falling scale, not a flat 1%: on a PPAT deed at IDR 3 billion the fee may not exceed 0.25%, IDR 7.5 million, under ATR/BPN Regulation 33/2021.
| Cost | Who pays | Rate | Rule |
|---|---|---|---|
| BPHTB acquisition duty | Buyer of a registered title (Hak Pakai, HGB, Hak Milik) | Up to 5% of the price, or of the assessed value (NJOP) if higher, after a regency tax-free threshold of at least IDR 80 million. A lease is not one of the rights it is charged on. | Law 1/2022 arts 46–47 |
| Seller's final income tax (PPh) | Seller of a registered title | 2.5% of the gross transfer value | PP 34/2016 art 2 |
| Tax on lease payments | Landowner receiving the rent | 10% final, on the gross rent | PP 34/2017 |
| PPAT fee for a Hak Pakai or HGB transfer deed | Usually the buyer, by agreement | At most 1% up to IDR 500 million; 0.75% to IDR 1 billion; 0.5% to IDR 2.5 billion; 0.25% above | PP 24/2016 art 32(1); ATR/BPN Regulation 33/2021 art 1 |
| Notary fee for a lease deed | By agreement between the parties | At most 2.5% up to IDR 100 million; 1.5% to IDR 1 billion; above that agreed, at most 1% | Law 30/2004 art 36(3), as amended by Law 2/2014 |
| PBB annual land and building tax | The holder or user each year; the lease should say which party pays | Up to 0.5% of the taxable assessed value, at a rate each regency sets | Law 1/2022 art 41 |
Outside Bali: leasehold and freehold across Indonesia
Everything above except Perda 4/2026 is national law, so it holds in Lombok, Jakarta or anywhere else in Indonesia: freehold (Hak Milik) for citizens only, Hak Pakai for a resident foreigner, HGB for a company, a lease for anyone, and a nominee void under Article 26(2) of the Basic Agrarian Law. What changes between places is local: the regency's BPHTB and PBB rates, its zoning plan, and the minimum price for a foreigner's house, which ATR/BPN Decree 1241/2022 sets province by province.
Is a Bali leasehold a good investment in 2026? No public record settles it: Indonesia does not publish sale prices, so every price or yield figure, ours included, is built from asking prices. A 25-year lease uses up a twenty-fifth of its term every year, and any yield has to be set against that. The rental-yield guide sets out what comes off a gross yield, and the area pages carry the current medians.
The rules this guide rests on
Each legal statement above traces to one of these. Article numbers are given so a notary or lawyer can check them directly.
| Rule | What it decides |
|---|---|
| Law 5/1960, the Basic Agrarian Law (UUPA), art 21(1) | Hak Milik is for Indonesian citizens only |
| UUPA art 21(3) | A foreigner who acquires Hak Milik by inheritance or marriage must give it up within one year |
| UUPA art 26(2) | Any transfer that passes Hak Milik to a foreigner, directly or indirectly, is void |
| UUPA arts 36, 42 and 44–45 | Who may hold HGB and Hak Pakai; the lease of land for building |
| PP 18/2021 on land rights | HGB and Hak Pakai terms of 30 + 20 + 30 years; one year to transfer a right once the holder no longer qualifies (arts 35 and 50) |
| ATR/BPN Decree 1241/SK-HK.02/IX/2022 | Minimum price of a house a foreigner may own: IDR 5 billion in Bali |
| BKPM Regulation 5/2025 | A PT PMA's paid-up capital: IDR 2.5 billion per business line |
| Civil Code art 1576 | A sale of the land does not end an existing lease unless the lease says so |
| Law 41/2009 art 72 | Up to five years' prison and an IDR 1 billion fine for converting protected farmland (LP2B) |
| Law 12/2011 art 15; Law 1/2026 | The limits on criminal penalties a regional regulation may carry |
| Bali Perda 4/2026 | Provincial ban on nominee land ownership and control of farmland conversion; text reported, not read by us |
| Law 1/2022 (regional taxes); PP 34/2016; PP 34/2017 | BPHTB, PBB and the income taxes in the cost table |
| PP 24/2016; ATR/BPN Regulation 33/2021 | The PPAT fee ceiling and its price scale |
| Law 30/2004 art 36, as amended by Law 2/2014 | The notary fee ceiling for a lease deed |
Common questions
Can a foreigner buy freehold property in Bali or anywhere in Indonesia?
No. Freehold (Hak Milik) is reserved for Indonesian citizens by Article 21 of the Basic Agrarian Law, which is national law. A foreigner can hold a leasehold, Hak Pakai with a KITAS or KITAP, or Hak Guna Bangunan through a PT PMA company.
Is leasehold or freehold better in Bali?
For a foreign buyer the real choice is leasehold, Hak Pakai or a PT PMA holding HGB, because freehold is not available. Leasehold is simplest and suits most holiday homes; Hak Pakai suits a resident who wants a home in their own name; a PT PMA suits a rental business.
How much cheaper is leasehold than freehold in Bali?
On 18 October 2026 the median leasehold home for sale among Baliestate's partner listings asked IDR 4.0 billion (742 listings) and the median freehold IDR 8.1 billion (143). Like for like the gap is smaller: a two-bedroom asked IDR 3.8 billion leasehold against IDR 4.6 billion freehold, and in Canggu the two medians were level.
How long is a leasehold in Bali?
Usually 25 to 30 years. Among leaseholds listed by Baliestate's partner agencies on 18 October 2026 that stated a term, the median was 26 years: 25 for completed villas and 28 for off-plan.
What happens when a Bali lease expires?
The land and everything built on it return to the landowner, unless the original deed gave you an extension with a price or a formula. An extension negotiated later is at whatever price the owner asks.
Can I rent out a leasehold villa?
Only if the lease allows subletting, and nightly rentals also need the business licences that Bali now enforces. Hak Pakai does not permit commercial letting at all.
Is buying 'freehold' through an Indonesian nominee safe?
No. The arrangement is void under Article 26(2) of the Basic Agrarian Law, so the person on the certificate is the owner the law recognises. Bali's Perda 4/2026 also prohibits brokering one, with administrative sanctions such as permit revocation, demolition and fines; the widely repeated five years' prison and IDR 1 billion fine come from a national farmland-conversion law (Law 41/2009), not from the Perda.
Can a foreigner get a mortgage to buy a villa in Bali?
Rarely. Indonesian banks lend to foreigners only with a KITAS or KITAP, local income and a large deposit, and a lease cannot carry a registered mortgage (Hak Tanggungan), which Law 4/1996 allows only over registered rights such as HGB and Hak Pakai. Most foreign purchases in Bali are paid in cash.
Looking for a home in Bali?
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Prices by tenure, area and bedrooms, the leasehold share, lease terms and land figures are medians over partner-agency listings on 18 October 2026; lease terms by completion status and prices per m² over those on 6 October 2026. Perda 4/2026 is described from Bali press coverage (25–27 February 2026) and DNT Lawyers' reading of its text; we could not find the text on jdih.baliprov.go.id or peraturan.bpk.go.id on 13 October 2026. General information, not legal advice: verify with a licensed Indonesian notary (PPAT) before committing funds.
Sources and further reading
- Law 5/1960, the Basic Agrarian Law (JDIH BPK)
- PP 18/2021 on land rights, Hak Pakai and HGB terms (JDIH BPK)
- ATR/BPN Regulation 33/2021 on PPAT fees, art 1 (State Gazette 2021 No. 1157)
- Law 41/2009 on protecting sustainable food farmland, arts 72–74 (JDIH Kemenkeu)
- Law 1/2026 on the adjustment of criminal penalties (JDIH BPK)
- Kilas Bali, 25 February 2026: Governor Koster enacts Perda 4/2026
- DNT Lawyers: reading Perda 4/2026's nominee ban (Indonesian)
- Leasehold villas for sale in Bali, with today's median and lease term
- Freehold villas for sale in Bali
- Villas for sale in Canggu, leasehold and freehold
- Leasehold land for sale in Bali
- Leasehold against freehold prices in every area, recomputed hourly
- Bali property by area, with live medians
Related guides
- Hak Pakai: the right-to-use title foreigners can hold
- PT PMA: when you need one, and when you do not
- The lease extension clause: the most valuable paragraph in the deed
- Does a Shorter Lease Make a Bali Villa Cheaper? The Data Says Barely
- Nominee Agreements in Bali: What Perda 4/2026 Changed
- Property taxes and fees when buying in Bali: BPHTB, PBB, NPWP
- Can Foreigners Buy Property in Bali? 2026 Legal Guide and Steps
- Buying Land in Bali: Titles, Zoning, Access and What a Foreigner Can Hold
- Can Foreigners Get a Mortgage in Bali? Bank Loans vs Cash
- Bali Villa Rental Yield 2026: Why Net Is 40–60% Below Gross
- Buying Property in Bali as a UK Citizen: Ownership, GBP, UK Tax