Property Ownership for Foreigners in Indonesia: Driving Market Growth and Investment

Since the enactment of the Job Creation Law, the Government has placed significant emphasis on regulations governing property ownership for foreigners. Beyond preventing nominee arrangements, this policy aims to attract and facilitate foreign direct investment in Indonesia.

Currently, foreigners can own residential properties, including landed houses and condominium units, provided they meet specific requirements such as land size, number of properties, and minimum price thresholds.

Landed House
For the ownership of landed houses, the purchased property must meet the following conditions:
(i) the property must be classified as a luxury house,
(ii) ownership is limited to one plot per individual or family, and
(iii) the maximum land area must not exceed 2,000 m².

The Government will grant a right of use certificate for the ownership of the landed house, which may be over state land, ownership land, or management rights land. The right of use is valid for 30 years, can be extended for 20 years, and renewed for another 30 years.

Condominium
Meanwhile, for condominium units, the property must meet the following conditions:
(i) the property must be classified as a commercial apartment, and
(ii) it must be located in a special economic zone, free trade zone, free port, industrial area, or other designated economic areas.

The ownership is granted under a right of ownership of the condominium unit (hak milik atas satuan rumah susun – HM Sarusun), which is separate from shared areas, common areas, and joint land.

Minimum Price Requirement
In addition to the above requirements, the Government imposes a minimum price for the property to be owned, based on its location. For example, in Jakarta, the minimum price for a landed house is IDR 5,000,000,000, and for a condominium unit, it is IDR 3,000,000,000.

Furthermore, after acquiring the property, the foreigner holding the rights cannot leave Indonesia for one year or more. If this condition is violated, the foreigner is required to relinquish or transfer the property rights to another eligible party.