Can Foreigners Own Land Ownership Rights in Indonesia?

In Indonesia, land ownership is closely tied to the nationality principle. Therefore, the Basic Agrarian Law explicitly stipulates that foreign nationals are not permitted to own land under Freehold Title (Hak Milik). This provision is set out in Article 21 paragraph (3) of the Agrarian Law and applies without exception.

Nevertheless, this does not mean that foreign nationals are entirely prohibited from residing in or owning homes in Indonesia. Indonesian law continues to provide avenues for foreign nationals to lawfully use land and own residential property. Such control or ownership is only permitted through certain types of land rights, which are exhaustively and strictly regulated under the prevailing laws and regulations.


Right Of Use Over Land (Limited Period)
The Right of Use (Hak Pakai) is the right to use land and/or to collect benefits from land that is directly controlled by the State or owned by another party. This right does not constitute ownership, but rather a right of use that is limited by a specific period of time.

Land that may be granted a Right of Use for a limited period includes:
a. Right of Use over state land
The Right of Use over state land is granted by a decision of the Minister of Agrarian Affairs and Spatial Planning (“ATR”). The maximum term of this right is 30 years, which may be extended for a maximum of 20 years and renewed for a maximum of 30 years.
b. Right of Use over freehold land
The Right of Use over freehold land is granted by the freehold title holder through a deed executed before a Land Deed Official (PPAT). The maximum term of this right is 30 years and it may be renewed through a new deed granting the Right of Use over the freehold land.
c. Right of Use over management rights land
The Right of Use over land under Management Rights (Hak Pengelolaan) is granted by a decision of the Minister of ATR with the approval of the holder of the Management Rights. The maximum term of this right is 30 years.


Right To Lease For Buildings
In addition to the Right of Use (Hak Pakai), foreign nationals may also control land or buildings through a Right to Lease (Hak Sewa). A person is considered to hold a Right to Lease when they use land owned by another party for building purposes and, in return, are required to pay rent to the landowner. The rent may be paid either in a lump sum or on a periodic basis, and it may be made before or after the land is used.
Unlike the Right of Use (Hak Pakai), a Right to Lease (Hak Sewa) is based on a private contractual relationship between the lessee and the landowner. Consequently, it does not grant any ownership rights over the land itself.

Ownership Of Residential Property By Foreign Nationals (Apartments And Landed Houses)
Indonesian laws and regulations allow foreign nationals to own certain types of residential property, including apartment units and landed houses, subject to specific conditions prescribed by law. Such ownership is limited to foreign nationals who legally reside or stay in Indonesia and who hold valid immigration documents, including a passport, visa, and a limited stay permit (KITAS). Foreigners nationals who are not residing or staying in Indonesia cannot purchase apartment units and landed houses, as they are unable to fulfill the mandatory immigration requirements, particularly the possession of a valid visa and KITAS.
Ownership of residential houses or housing units by foreign nationals, as referred to in Article 71 Government Regulation No. 18 of 2021, is granted subject to the following limitations:
a. minimum purchase price;
b. land area;
c. number of land plots or apartment units; and
d. designated use as a residential house or housing unit.

If a foreign national who owns a residential house or housing unit passes away, the property may be inherited by their heirs, however, where the heirs are also foreign nationals, they must hold valid immigration documents. Also, if the owner no longer satisfy the prescribed requirements such as no longer permanently residing in Indonesia they are required to relinquish or transfer the Right of Use within a specified period to another party who meets the applicable eligibility criteria.