Legal Aspects of Buying Property in Bali — What Every Investor Should Know

1. Forms of Ownership: Leasehold, Nominee, PT PMA

Foreigners are prohibited from direct land ownership in Bali. In practice, the following models are used:

• Leasehold — official long-term lease (typically 25–30 years with renewal rights up to 80–100 years). This is a safe and legal method of property ownership.
• Nominee — the property is registered in the name of a local resident. Although not formally banned, this carries significant legal risks: ownership cannot be proven, and there is a high risk of losing the asset.
• PT PMA — a foreign-owned company in Indonesia through which land can be owned for business purposes. Requires registration and financial/tax compliance.

Conclusion: For private investments in rentals or personal use, leasehold remains the safest form.

2. Permits: IMB, PBG, SLF

Legal clarity of a deal is not possible without proper permits:

• IMB (Izin Mendirikan Bangunan) — construction permit valid until 2021.
• PBG (Persetujuan Bangunan Gedung) — replaced IMB in 2021. Issued based on architectural, engineering, and legal standards.
• SLF (Sertifikat Laik Fungsi) — confirms the building is fit for occupancy. Mandatory for renting, selling, and connecting to utilities.
  

Important: Absence of PBG or SLF means the building may be illegal and not eligible for legal rent or sale.

Example: In the PGD Aparthotel project:

• PBG is obtained before construction begins.
• SLF will be issued before commissioning.
• The deal is structured as a tripartite agreement: landowner — developer — investor.
• All documents are available before signing and may be reviewed by a notary or lawyer.

3. Land Categories: What Is Allowed for Construction

Land in Bali is categorized by its purpose:

• Residential — suitable for houses and villas.
• Pariwisata (tourism) — suitable for hotels and aparthotels.
• Green Zone / Agricultural — construction is prohibited. Transactions on such plots are illegal and risky.
  

Conclusion: Invest only in projects located on land with approved usage (Residential or Pariwisata).

4. Due Diligence — Mandatory Legal Verification

Before signing a contract, conduct due diligence:

• Check land ownership rights
• Verify IMB / PBG / SLF
• Verify leasehold structure
• Verify zoning compliance
• Ensure the property is free of liens or restrictions
  

In PGD Aparthotel, due diligence is available before reservation. 

The investor receives:

• Copies of all legal documents
• Information about the land and deal structure
• Option to involve an independent lawyer

5. Deal Structure

How a safe property transaction is conducted:

1. Review the project and documents
2. Sign a preliminary agreement and pay the deposit
3. Conduct due diligence
4. Sign the leasehold agreement
5. Register the deal with a notary
6. Hand over for management and begin generating income

PGD uses a tripartite model, ensuring legal security for the investor.

6. Management and Rental

Important: The property must be managed by a licensed operator.
PGD Aparthotel signs an agreement with a professional management company, ensuring:

• Yields of up to 10% annually
• Transparent reporting and legal compliance
• Service and marketing through legal channels
  

Conclusion

Property investment in Bali can be safe and profitable if:

• Leasehold structure is used
• All permits are secured (PBG, SLF)
• The land category is appropriate
• The project passed due diligence
• The transaction is transparent and notarized
• Management is handled by a licensed company

PGD Aparthotel meets all criteria for safe investment in 2025.

Ready to invest in Bali?

PGD Aparthotel is one of the few projects that offers legal transparency, full deal support, and documented guarantees.

Submit a request to receive a consultation and unit selection with the full legal documentation package.