Why is freehold in Indonesia considered a rare form of property ownership?

Indonesian law provides several forms of property ownership. For foreign buyers, two formats are most common – freehold and leasehold. Both are actively used in transactions but have their own specifics.

Freehold (Hak Guna Bangunan) is ownership of land and property without any time limit. This format is usually registered through an Indonesian company and allows not only ownership but also transfer of the property by inheritance. Essentially, it is equivalent to full ownership as commonly seen in Europe or the US.

Freehold is rarely found, especially in resort and investment-attractive areas. Most new projects there are implemented in the leasehold (long-term rental) format. Therefore, every freehold property on the market can be considered a limited resource.

Leasehold (Hak Sewa) is long-term rental. The agreement is signed directly to an individual, including a foreigner. The lease period usually ranges from 25–45 years with an option to extend. The cost of leasehold properties is around 25–30% lower compared to freehold, which makes them more affordable for entry.

Thus, the choice depends on your goals: whether you need a long-term asset without a time limit or a more flexible and affordable option with a fixed rental period.

Why is freehold in Indonesia considered a rare form of property ownership?

What properties are currently available in the freehold format?

We have compiled a catalogue of projects where freehold ownership is available. This is a rare opportunity to enter premium locations in Bali and nearby islands with full ownership rights.

•   Villas from $182,000

•   Locations: Canggu, Jimbaran, Islands of Lombok and Gili

•   Yield: 8–15% p.a.

•   In a number of projects you can choose between freehold and leasehold – this gives flexibility of strategy

Example: beachfront villas on Gili Island

On Gili Island, the only 5* resort located directly on the seafront is being developed. This combines high passive rental income with capital appreciation driven by land value growth and limited supply.

Location: nearby beach clubs, hotels, bars, and restaurants, as well as top diving spots. The island remains one of the most sought-after destinations for premium tourism in Indonesia.

Project amenities:

restaurants and spa complex
gym
private beach club

Commercial terms:

Prices: from $375,945 for villas of 78–332 sq.m
Price includes: full fit-out and furniture, private pool
Projected yield: 9–12% p.a.
Ownership formats: freehold or leasehold for 100 years with extension for 50 years
Status: phase 1 already completed, phase 2 completion – Q3 2026

Who is freehold in Indonesia suitable for?

For investors who want a long-term asset with inheritance rights
For those who view property as a stable source of income and capital growth
For families planning relocation or a second home by the ocean
For those who value limited ownership formats with high liquidity

Free Freehold in Indonesia is a one-off product. It combines prestige, long-term capital protection, and stable rental income. With limited supply, such properties are especially valued on the market and demonstrate price growth faster than leasehold equivalents.

Get the catalogue with current freehold projects – and we will help you choose a solution tailored to your goals and strategy.

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Oct 24, 2025

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