As the Bali real estate market evolves, many investors are asking: is leasehold property still worth it in 2025? With rising prices, changing regulations, and growing demand from digital nomads and expats, the answer isn’t one-size-fits-all. But one thing is clear — leasehold remains one of the most accessible and flexible options for foreign buyers in Indonesia.
What Is Leasehold?
In Indonesia, leasehold (Hak Sewa) means you don’t own the land, but you have the legal right to use it for a set number of years (usually 25 to 30), with options to extend. It’s commonly used by foreigners buying villas, commercial spaces, or land.
Unlike freehold (Hak Milik), which is restricted to Indonesian citizens, leasehold is 100% legal and does not require setting up a company or nominee.
Why Leasehold Remains Attractive in 2025
1. Legally Safe for Foreigners
Leasehold agreements can be secured through clear contracts, notarized locally, and even registered with the Land Office. It’s a legal framework that gives foreigners long-term use and peace of mind.
2. Lower Upfront Costs
Leasehold properties are usually 30–50% cheaper than equivalent freehold options. For the same budget, investors can get a better location, larger villa, or higher rental return.
3. Strong Demand for Mid-Term Rentals
Thanks to Bali’s popularity among digital nomads and long-stay visitors, mid-term rentals (1 to 6 months) are booming. Leasehold owners can tap into this demand and generate steady income—without needing to own the land.
4. Renewable & Transferable
Most leasehold contracts include options to extend and sometimes to resell. This gives flexibility to adapt your strategy over time, especially in hot zones like Canggu, Berawa, Uluwatu, or Ubud.
5. PT PMA Not Required
Unlike other ownership structures (like Hak Guna Bangunan), leasehold does not require setting up a company. This simplifies both the setup and the tax implications for individual investors.
What to Watch Out For
- Some older leasehold contracts don’t include clear extension terms — always review the agreement with a notary
- As lease terms decrease, so does resale value — it’s better to buy with 20+ years remaining
- Prices are rising fast in popular areas — act early to secure the best deals
Best Areas to Invest in Leasehold in 2025
- Canggu & Pererenan – high rental returns, lifestyle appeal
- Uluwatu & Bingin – growing infrastructure, surfing crowd
- Ubud – wellness market, long-term living
- North Bali – affordable prices, future growth potential
Conclusion
In 2025, leasehold remains a smart, legal, and flexible way for foreigners to invest in Bali’s booming real estate market. It offers a balanced mix of lower entry cost, solid rental income, and long-term potential — when structured correctly.
At Mata Property Bali, we help you identify the best leasehold opportunities, negotiate fair terms, and secure your investment with full legal clarity.
Thinking about buying a leasehold villa? Let’s talk.
