Foreigners cannot directly own freehold land in Indonesia. However, they can acquire property through leasehold agreements or by establishing a foreign-owned company (PT PMA), which allows for certain ownership rights under titles like Hak Pakai (Right to Use) or Hak Guna Bangunan (Right to Build).

Returns vary based on location, property type, and management. On average, investors can expect annual rental yields ranging from 8% to 15%, with some areas offering even higher returns due to strong tourism demand.

Freehold (Hak Milik) grants full ownership but is generally restricted to Indonesian citizens. Leasehold allows foreigners to lease property for a set period, typically 25–30 years, with options to extend. Leasehold properties are often more affordable and can offer higher ROI.

Investors should be aware of various costs, including land and building acquisition duty (BPHTB) at 5% of the property’s value, notary fees, and income taxes on rental income. Leasehold transactions may have different tax implications compared to freehold.

The timeline varies. Purchasing an existing property can take a few weeks to a few months, depending on due diligence and legal processes. Developing a new property typically takes 10–14 months from land acquisition to completion.

Investing in off-plan properties can be safe if due diligence is conducted. It’s crucial to work with reputable developers, ensure clear contractual agreements, and understand the terms related to construction timelines and guarantees.