Bali continues to attract people from around the world looking for the perfect balance between lifestyle, investment, and natural beauty. One of the most popular ways to enjoy long-term living or rental income on the island is through leasehold ownership. But how exactly do you secure a villa lease in Bali—and do it safely?
What Is a Leasehold Agreement?
A leasehold gives you the legal right to use a property for a fixed period—commonly 25 or 30 years—with the option to renew. This arrangement is completely legal for foreigners and widely used for residential villas and commercial rentals.
It’s important to note that you’re not buying the land itself—you’re leasing the right to use it.
Step-by-Step: How to Lease a Villa in Bali
1. Define Your Needs
Start by clarifying what you’re looking for:
- Location (Canggu, Uluwatu, Ubud…)
- Number of bedrooms
- Budget
- Purpose (living vs investment)
Knowing this will help your agent narrow the search and ensure the lease matches your goals.
2. Work With a Trusted Agency
Always work with a reputable real estate agency that understands the local legal framework. A good agent will help you:
- Verify ownership documents
- Negotiate fair lease terms
- Avoid overpriced or risky deals
3. Check the Land Certificate
Every leasehold should be based on a valid land certificate (Hak Milik), owned by an Indonesian citizen. Your lease contract must clearly refer to this certificate.
Make sure the land is:
- Properly zoned for residential or commercial use
- Free of disputes or encumbrances
4. Draft a Notarized Lease Agreement
The lease must be signed in front of a notary and registered with the Land Office (BPN) to be valid and enforceable. This is the most important legal protection you have as a foreigner.
The agreement should include:
- Lease duration
- Extension terms
- Use limitations (e.g., subletting)
- Payment schedule
- Rights and responsibilities of both parties
5. Negotiate Extensions in Advance
Most leases can be extended, but this must be stated in the contract. If it’s not clearly defined, the landowner is under no obligation to renew the lease—even if you’ve built a home on the land.
Some leases include:
- Pre-agreed extension terms (e.g., +20 years at a fixed rate)
- Right of first refusal if the property is sold
- Options to convert into a PT PMA arrangement later on
Key Tips for a Safe Leasehold Deal
- Never pay in full without a signed, notarized contract
- Avoid handshake agreements or informal deals
- Use a bilingual contract (Indonesian + English)
- Include clear refund and penalty clauses
Final Thoughts
Securing a long-term villa lease in Bali is a smart and accessible way for foreigners to enjoy life on the island or earn rental income—as long as the legal steps are followed properly.
At Mata Property Bali, we guide you from property selection to contract signing, ensuring your investment is safe, compliant, and tailored to your needs.
Ready to find your Bali villa? Contact us for a personalized consultation.
