Leasehold vs Hak Pakai Bali – Simple Guide for Foreign Buyers
Confused about leasehold vs Hak Pakai in Bali? Learn the key differences, pros and cons, and the safest options to buy property in Bali for foreigners.
Fresh Leaf Consulting – Bali Property Advisors
8/20/20252 min read
Leasehold vs Hak Pakai in Bali – A Simple Guide for Foreign Buyers
Why Foreign Buyers Need to Understand Ownership Options
Buying property in Bali can be confusing for foreigners. Unlike in many countries, freehold ownership is not open to non-Indonesians. Instead, you must choose a legal structure such as Leasehold or Hak Pakai.
Both are legal, both are common — but they serve very different purposes. Choosing the wrong one can cost you money and limit your rights.
Leasehold is the most common way foreigners buy property in Bali. It is essentially a long-term rental agreement.
Duration: Usually 25–30 years, with possible extensions.
Rights: You can use the property during the lease period, rent it out, or live in it.
Renewal: Extensions are usually negotiated before signing the first contract.
Pros of Leasehold
Lower upfront cost than Hak Pakai.
Easier to find in Bali’s property market.
Common choice for holiday rentals and investment villas.
Cons of Leasehold
You do not own the property forever.
Value decreases as the lease gets shorter.
Extension terms depend on landlord agreement.
What is Leasehold?
Hak Pakai means “Right to Use” in Indonesian law. It is available to foreigners under certain conditions.
Duration: Up to 30 years, renewable up to 80 years total.
Rights: You may use the property for personal or business purposes.
Registration: Must be approved by the Indonesian government.
Pros of Hak Pakai
Longer-term security compared to Leasehold.
Recognized legal title registered with government.
Can be used for residence permits (KITAS/KITAP).
Cons of Hak Pakai
Higher cost and more paperwork.
Limited availability compared to leasehold villas.
Rules may change with government regulations.
What is Hak Pakai?
Key Differences Between Leasehold and Hak Pakai
Which Option is Best for You?
• Investors (rental villas): Leasehold is often best due to flexibility and lower cost.
• Retirees / long-term residents: Hak Pakai is safer for stability and immigration purposes.
• Families planning legacy: Hak Pakai gives more security for future generations.
• Buying through a “nominee” arrangement — risky and can void ownership.
• Not securing extension terms in writing.
• Believing an agent’s verbal promise without legal documents.
Common Mistakes to Avoid
Fresh Leaf’s Role
We guide clients step-by-step in choosing Leasehold vs Hak Pakai, ensuring the structure fits their goals, budget, and legal safety.
👉 Contact Fresh Leaf for a consultation before signing any agreement.