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OWNERSHIP
There are a few types of land ownership in Indonesia for both foreigners as well as Indonesian citizens. At Heavenly Dream, we can assist you in obtaining your land or property promptly and legally through established institutions. This can be done through a lawyer's office in conjunction with the land department of Indonesia and legal experts.
Freehold Title (HM or Hak Milik)
Freehold title is the most highly regarded and sought after title in Indonesia. This title can only be held by Indonesian citizens, or by
Indonesian legal entities that are entirely owned and controlled by
Indonesian citizens.
Leasehold Title (HS or Hak Sewa)
Leasehold rights are normally granted to tenants in the name of a foreigner or lessee. Acquiring the leasehold of property is straightforward and common where lease periods vary between 30 to 50 years. Extensions of leaseholds in Indonesia are normally agreed in advance before the current leasehold period is due.
Building Rights Title (HGB or Hak Guna Bangunan)
A Building Rights Title (HGB) gives an individual the right to own and build buildings on a land parcel that an Indonesian citizen rightfully owns. This title is
granted for a period up to 30 years, which however can be extended for an additional 20 years if requested. HGB title is granted to Indonesian citizens or legal
entities (including PMA companies), and can also be used as collateral
or transferred to a third party. A foreign investment company ("Penanaman Model Asing" - PMA) allows a foreigner to fully control the property as the property would be held under the company's name. The HGB expires after 30 years and can be renewed
several times. However, there are tax implications to be considered and
the Department of Trade will review PMA companies after 30 years so it
may be necessary to re-apply for the PMA license.
Right to Use Title (HP or Hak Pakai) – Freehold Title for Foreigners
Hak Pakai title is the government approved method for foreigners to
purchase the exclusive use over a Hak Milik land which is registered in a
separate certificate of title in the name of the foreigner. Hak
Pakai title is granted for an intitial term of 25 years, which can
then be extended up to a further three times giving a total tenure of
100 years. Not to be confused with Leasehold title (Hak Sewa),
Hak Pakai is a registered proprietary interest in the Hak Milik land
rather than an unregistered interest. A foreigner is permitted to hold
only one Hak Pakai title in Indonesia at any time. Hak Pakai is transferable or renewable if sold to another foreign purchaser.