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Ada Pertanyaan? Hubungi Kami Marcell Sihombing, Kartini L. Makmur
Foreign Citizens in Indonesia. Photo by: RES.
The Minister of Agrarian Affairs and Spatial Planning/Head of the National Land Agency has finally issued Regulation No. 13 0f 2016 on Procedures for Obtaining, Relinquishing, or Transferring Ownership of Residential Property for Foreign Citizens Domiciled in Indonesia (2016 Regulation), in order to further regulate the matter of property ownership for foreign citizens.
According to an official statement made on the Secretariat of the Cabinet’s website on Monday, 18 April 2016, the 2016 Regulation has been issued in order to implement Government Regulation No. 103 of 2015on the Ownership of Residential Property for Foreign Citizens Domiciled in Indonesia (2015 Regulation).
In essence, the 2016 Regulation stipulates that foreign citizens domiciled in Indonesia may possess right-to-use (hak pakai) property titles, provided that said property is built on land designated with a management-right title (hak pengelolaan) or a freehold title (hakmilik), or if the property in question is built on government-owned land. Furthermore, foreign citizens are also allowed to purchase apartment units which have been built on government-owned land designated with right-to-use titles.
However, certain restrictions have to be observed regarding the prices of residential property or apartment units which are allowed to be purchased by foreign citizens, and these prices vary in different regions across the country. Specifically, foreign citizens may only purchase residential property of a value of IDR 10 billion or higher in Jakarta; residential property of a value of IDR 5 billion or higher in Banten, West Java, and East Java, residential property of a value of IDR 3 billion or higher in Central Java, Yogyakarta, and Bali; residential property of a value of IDR 2 billion or higher in Nusa Tenggara Barat Province (NTB), North Sumatra, East Borneo, and South Sulawesi; and residential property of a value of IDR 1 billion or higher in all other provinces aside from those mentioned above.
Meanwhile, prices for apartment units available for purchase by foreign citizens has been set at IDR 5 billion or higher in Jakarta; IDR 2 billion or higher in Bali; IDR 1.5 billion or higher in East Java; IDR 1 billion or higher in Banten, West Java, Yogyakarta, NTB, North Sumatra, East Borneo, and South Sulawesi; and IDR 750 million or higher in all other Indonesian provinces aside from those mentioned above.
The 2016 Regulation further stipulates that foreign citizens may only purchase new residential property or apartment units. In other words, a property has to be bought directly from its developer or first owner. Foreign citizens are therefore prohibited from purchasing property which has been transferred to another party.
Moreover, the 2016 Regulation also allows for foreign citizens to use such property as mortgages (hak tanggungan) in order to obtain loans. However, a foreign citizen must first obtain approval from the owner of the land/freehold-estate title holder or the management-right title holder in question if they wish to use their property as collateral.
Furthermore, the 2016 Regulation also regulates for the transfer of ownership through inheritance, provided that the bequeathed party or parties first secures a valid Indonesian stay permit. Additionally, the 2016 Regulation also prohibits foreign citizens from owning property in Indonesia if they intend to then lease said property on to other parties.
Eddy Hussy, Chair of Indonesia Real Estate (REI), told hukumonline that he appreciated the government’s move to regulate property ownership for foreigners in greater detail. However, Mr. Hussy also leveled several criticisms at the government regarding the various provisions set out in the 2016 Regulation.
By way of example, Mr. Hussy highlighted the new prohibition on foreign citizens being able to lease their property. Mr. Hussy believes that the 2016 Regulation will prove less attractive to the property market in general as a result of this prohibition. This is due to the fact that most foreign citizens tend to be highly mobile and many leave Indonesia for lengthy periods of time and would thus be looking to lease their property while they are away.
“I predict that this prohibition on renting property to third parties will ultimately make the 2016 Regulation less attractive to foreign citizens. The ability to own property in Indonesia which cannot then be rented to any other parties hardly makes for an appealing proposition,” asserted Mr. Hussy on Monday, 18 April 2016.
Mr. Hussy believes that most foreign citizens want their property investments to generate income for them when they have to leave said property due to frequent travel commitments. Mr. Hussy therefore asserts that if the government is intending to formulate a regulation which will ultimately improve foreign investment in the property sector, then foreign citizens should inevitably be allowed to rent out any property that they purchase. Such a provision would, according to Mr. Hussy, be far more attractive to foreign citizens who are intending to purchase property within Indonesia.
Mr. Hussy concluded his statement to hukumonline by asserting that it was considered normal around the world for property owners to rent out their property, as many view property as a form of investment. It is therefore seen as a waste to leave such an asset empty, neither being used nor generating income.
“After all, it is common practice for people to purchase property which they can easily sell or rent when it is not being used by them personally,” Mr. Hussy concluded.
According to an official statement made on the Secretariat of the Cabinet’s website on Monday, 18 April 2016, the 2016 Regulation has been issued in order to implement Government Regulation No. 103 of 2015on the Ownership of Residential Property for Foreign Citizens Domiciled in Indonesia (2015 Regulation).
In essence, the 2016 Regulation stipulates that foreign citizens domiciled in Indonesia may possess right-to-use (hak pakai) property titles, provided that said property is built on land designated with a management-right title (hak pengelolaan) or a freehold title (hakmilik), or if the property in question is built on government-owned land. Furthermore, foreign citizens are also allowed to purchase apartment units which have been built on government-owned land designated with right-to-use titles.
However, certain restrictions have to be observed regarding the prices of residential property or apartment units which are allowed to be purchased by foreign citizens, and these prices vary in different regions across the country. Specifically, foreign citizens may only purchase residential property of a value of IDR 10 billion or higher in Jakarta; residential property of a value of IDR 5 billion or higher in Banten, West Java, and East Java, residential property of a value of IDR 3 billion or higher in Central Java, Yogyakarta, and Bali; residential property of a value of IDR 2 billion or higher in Nusa Tenggara Barat Province (NTB), North Sumatra, East Borneo, and South Sulawesi; and residential property of a value of IDR 1 billion or higher in all other provinces aside from those mentioned above.
Meanwhile, prices for apartment units available for purchase by foreign citizens has been set at IDR 5 billion or higher in Jakarta; IDR 2 billion or higher in Bali; IDR 1.5 billion or higher in East Java; IDR 1 billion or higher in Banten, West Java, Yogyakarta, NTB, North Sumatra, East Borneo, and South Sulawesi; and IDR 750 million or higher in all other Indonesian provinces aside from those mentioned above.
The 2016 Regulation further stipulates that foreign citizens may only purchase new residential property or apartment units. In other words, a property has to be bought directly from its developer or first owner. Foreign citizens are therefore prohibited from purchasing property which has been transferred to another party.
Moreover, the 2016 Regulation also allows for foreign citizens to use such property as mortgages (hak tanggungan) in order to obtain loans. However, a foreign citizen must first obtain approval from the owner of the land/freehold-estate title holder or the management-right title holder in question if they wish to use their property as collateral.
Furthermore, the 2016 Regulation also regulates for the transfer of ownership through inheritance, provided that the bequeathed party or parties first secures a valid Indonesian stay permit. Additionally, the 2016 Regulation also prohibits foreign citizens from owning property in Indonesia if they intend to then lease said property on to other parties.
Eddy Hussy, Chair of Indonesia Real Estate (REI), told hukumonline that he appreciated the government’s move to regulate property ownership for foreigners in greater detail. However, Mr. Hussy also leveled several criticisms at the government regarding the various provisions set out in the 2016 Regulation.
By way of example, Mr. Hussy highlighted the new prohibition on foreign citizens being able to lease their property. Mr. Hussy believes that the 2016 Regulation will prove less attractive to the property market in general as a result of this prohibition. This is due to the fact that most foreign citizens tend to be highly mobile and many leave Indonesia for lengthy periods of time and would thus be looking to lease their property while they are away.
“I predict that this prohibition on renting property to third parties will ultimately make the 2016 Regulation less attractive to foreign citizens. The ability to own property in Indonesia which cannot then be rented to any other parties hardly makes for an appealing proposition,” asserted Mr. Hussy on Monday, 18 April 2016.
Mr. Hussy believes that most foreign citizens want their property investments to generate income for them when they have to leave said property due to frequent travel commitments. Mr. Hussy therefore asserts that if the government is intending to formulate a regulation which will ultimately improve foreign investment in the property sector, then foreign citizens should inevitably be allowed to rent out any property that they purchase. Such a provision would, according to Mr. Hussy, be far more attractive to foreign citizens who are intending to purchase property within Indonesia.
Mr. Hussy concluded his statement to hukumonline by asserting that it was considered normal around the world for property owners to rent out their property, as many view property as a form of investment. It is therefore seen as a waste to leave such an asset empty, neither being used nor generating income.
“After all, it is common practice for people to purchase property which they can easily sell or rent when it is not being used by them personally,” Mr. Hussy concluded.
(rfs/sp)
Marcell Sihombing, Kartini L. Makmur
Foreign Citizens in Indonesia. Photo by: RES.
The Minister of Agrarian Affairs and Spatial Planning/Head of the National Land Agency has finally issued Regulation No. 13 0f 2016 on Procedures for Obtaining, Relinquishing, or Transferring Ownership of Residential Property for Foreign Citizens Domiciled in Indonesia (2016 Regulation), in order to further regulate the matter of property ownership for foreign citizens.
According to an official statement made on the Secretariat of the Cabinet’s website on Monday, 18 April 2016, the 2016 Regulation has been issued in order to implement Government Regulation No. 103 of 2015on the Ownership of Residential Property for Foreign Citizens Domiciled in Indonesia (2015 Regulation).
In essence, the 2016 Regulation stipulates that foreign citizens domiciled in Indonesia may possess right-to-use (hak pakai) property titles, provided that said property is built on land designated with a management-right title (hak pengelolaan) or a freehold title (hakmilik), or if the property in question is built on government-owned land. Furthermore, foreign citizens are also allowed to purchase apartment units which have been built on government-owned land designated with right-to-use titles.
However, certain restrictions have to be observed regarding the prices of residential property or apartment units which are allowed to be purchased by foreign citizens, and these prices vary in different regions across the country. Specifically, foreign citizens may only purchase residential property of a value of IDR 10 billion or higher in Jakarta; residential property of a value of IDR 5 billion or higher in Banten, West Java, and East Java, residential property of a value of IDR 3 billion or higher in Central Java, Yogyakarta, and Bali; residential property of a value of IDR 2 billion or higher in Nusa Tenggara Barat Province (NTB), North Sumatra, East Borneo, and South Sulawesi; and residential property of a value of IDR 1 billion or higher in all other provinces aside from those mentioned above.
Meanwhile, prices for apartment units available for purchase by foreign citizens has been set at IDR 5 billion or higher in Jakarta; IDR 2 billion or higher in Bali; IDR 1.5 billion or higher in East Java; IDR 1 billion or higher in Banten, West Java, Yogyakarta, NTB, North Sumatra, East Borneo, and South Sulawesi; and IDR 750 million or higher in all other Indonesian provinces aside from those mentioned above.
The 2016 Regulation further stipulates that foreign citizens may only purchase new residential property or apartment units. In other words, a property has to be bought directly from its developer or first owner. Foreign citizens are therefore prohibited from purchasing property which has been transferred to another party.
Moreover, the 2016 Regulation also allows for foreign citizens to use such property as mortgages (hak tanggungan) in order to obtain loans. However, a foreign citizen must first obtain approval from the owner of the land/freehold-estate title holder or the management-right title holder in question if they wish to use their property as collateral.
Furthermore, the 2016 Regulation also regulates for the transfer of ownership through inheritance, provided that the bequeathed party or parties first secures a valid Indonesian stay permit. Additionally, the 2016 Regulation also prohibits foreign citizens from owning property in Indonesia if they intend to then lease said property on to other parties.
Eddy Hussy, Chair of Indonesia Real Estate (REI), told hukumonline that he appreciated the government’s move to regulate property ownership for foreigners in greater detail. However, Mr. Hussy also leveled several criticisms at the government regarding the various provisions set out in the 2016 Regulation.
By way of example, Mr. Hussy highlighted the new prohibition on foreign citizens being able to lease their property. Mr. Hussy believes that the 2016 Regulation will prove less attractive to the property market in general as a result of this prohibition. This is due to the fact that most foreign citizens tend to be highly mobile and many leave Indonesia for lengthy periods of time and would thus be looking to lease their property while they are away.
“I predict that this prohibition on renting property to third parties will ultimately make the 2016 Regulation less attractive to foreign citizens. The ability to own property in Indonesia which cannot then be rented to any other parties hardly makes for an appealing proposition,” asserted Mr. Hussy on Monday, 18 April 2016.
Mr. Hussy believes that most foreign citizens want their property investments to generate income for them when they have to leave said property due to frequent travel commitments. Mr. Hussy therefore asserts that if the government is intending to formulate a regulation which will ultimately improve foreign investment in the property sector, then foreign citizens should inevitably be allowed to rent out any property that they purchase. Such a provision would, according to Mr. Hussy, be far more attractive to foreign citizens who are intending to purchase property within Indonesia.
Mr. Hussy concluded his statement to hukumonline by asserting that it was considered normal around the world for property owners to rent out their property, as many view property as a form of investment. It is therefore seen as a waste to leave such an asset empty, neither being used nor generating income.
“After all, it is common practice for people to purchase property which they can easily sell or rent when it is not being used by them personally,” Mr. Hussy concluded.
According to an official statement made on the Secretariat of the Cabinet’s website on Monday, 18 April 2016, the 2016 Regulation has been issued in order to implement Government Regulation No. 103 of 2015on the Ownership of Residential Property for Foreign Citizens Domiciled in Indonesia (2015 Regulation).
In essence, the 2016 Regulation stipulates that foreign citizens domiciled in Indonesia may possess right-to-use (hak pakai) property titles, provided that said property is built on land designated with a management-right title (hak pengelolaan) or a freehold title (hakmilik), or if the property in question is built on government-owned land. Furthermore, foreign citizens are also allowed to purchase apartment units which have been built on government-owned land designated with right-to-use titles.
However, certain restrictions have to be observed regarding the prices of residential property or apartment units which are allowed to be purchased by foreign citizens, and these prices vary in different regions across the country. Specifically, foreign citizens may only purchase residential property of a value of IDR 10 billion or higher in Jakarta; residential property of a value of IDR 5 billion or higher in Banten, West Java, and East Java, residential property of a value of IDR 3 billion or higher in Central Java, Yogyakarta, and Bali; residential property of a value of IDR 2 billion or higher in Nusa Tenggara Barat Province (NTB), North Sumatra, East Borneo, and South Sulawesi; and residential property of a value of IDR 1 billion or higher in all other provinces aside from those mentioned above.
Meanwhile, prices for apartment units available for purchase by foreign citizens has been set at IDR 5 billion or higher in Jakarta; IDR 2 billion or higher in Bali; IDR 1.5 billion or higher in East Java; IDR 1 billion or higher in Banten, West Java, Yogyakarta, NTB, North Sumatra, East Borneo, and South Sulawesi; and IDR 750 million or higher in all other Indonesian provinces aside from those mentioned above.
The 2016 Regulation further stipulates that foreign citizens may only purchase new residential property or apartment units. In other words, a property has to be bought directly from its developer or first owner. Foreign citizens are therefore prohibited from purchasing property which has been transferred to another party.
Moreover, the 2016 Regulation also allows for foreign citizens to use such property as mortgages (hak tanggungan) in order to obtain loans. However, a foreign citizen must first obtain approval from the owner of the land/freehold-estate title holder or the management-right title holder in question if they wish to use their property as collateral.
Furthermore, the 2016 Regulation also regulates for the transfer of ownership through inheritance, provided that the bequeathed party or parties first secures a valid Indonesian stay permit. Additionally, the 2016 Regulation also prohibits foreign citizens from owning property in Indonesia if they intend to then lease said property on to other parties.
Eddy Hussy, Chair of Indonesia Real Estate (REI), told hukumonline that he appreciated the government’s move to regulate property ownership for foreigners in greater detail. However, Mr. Hussy also leveled several criticisms at the government regarding the various provisions set out in the 2016 Regulation.
By way of example, Mr. Hussy highlighted the new prohibition on foreign citizens being able to lease their property. Mr. Hussy believes that the 2016 Regulation will prove less attractive to the property market in general as a result of this prohibition. This is due to the fact that most foreign citizens tend to be highly mobile and many leave Indonesia for lengthy periods of time and would thus be looking to lease their property while they are away.
“I predict that this prohibition on renting property to third parties will ultimately make the 2016 Regulation less attractive to foreign citizens. The ability to own property in Indonesia which cannot then be rented to any other parties hardly makes for an appealing proposition,” asserted Mr. Hussy on Monday, 18 April 2016.
Mr. Hussy believes that most foreign citizens want their property investments to generate income for them when they have to leave said property due to frequent travel commitments. Mr. Hussy therefore asserts that if the government is intending to formulate a regulation which will ultimately improve foreign investment in the property sector, then foreign citizens should inevitably be allowed to rent out any property that they purchase. Such a provision would, according to Mr. Hussy, be far more attractive to foreign citizens who are intending to purchase property within Indonesia.
Mr. Hussy concluded his statement to hukumonline by asserting that it was considered normal around the world for property owners to rent out their property, as many view property as a form of investment. It is therefore seen as a waste to leave such an asset empty, neither being used nor generating income.
“After all, it is common practice for people to purchase property which they can easily sell or rent when it is not being used by them personally,” Mr. Hussy concluded.
(rfs/sp)