Last Updated on February 2, 2025 by Yasmina
Uncover the truth about whether foreigners own freehold property in Lombok, Indonesia. Explore legal options, restrictions, and alternative ownership structures available for foreign investors.
Table of Contents
Understanding Freehold Property in Indonesia
In Indonesia, freehold property (Hak Milik) represents the most complete and permanent form of land ownership. However, this title is exclusively available to Indonesian citizens, making it inaccessible for foreign investors under Indonesian law. Despite this limitation, there are alternative legal pathways that allow foreigners to invest in Lombok’s property market.
Why Can’t Foreigners Own Freehold Property?
Legal Framework
Indonesia’s property laws are designed to prioritize the rights of Indonesian citizens, ensuring that land remains under local control. The Basic Agrarian Law of 1960 explicitly prohibits foreigners from holding freehold titles.
Implications for Foreigners
While freehold is not an option, foreigners can still legally acquire property in Indonesia through other ownership structures, such as leasehold agreements or establishing a PT PMA (foreign-owned company).
Pro Tip: Stay updated on any regulatory changes by consulting with local legal professionals.
Alternative Ownership Options for Foreigners
1. Leasehold Property (Hak Sewa)
- Definition: Allows foreigners to lease land or property for up to 25 years, with renewal options.
- Best For: Long-term residential or commercial projects.
- Legal Protections: Leasehold agreements are governed by Indonesian law, ensuring security for foreign investors.
2. Right to Build (Hak Guna Bangunan – HGB)
- Definition: Provides foreigners with the right to own structures on leased land for up to 30 years, renewable.
- Flexibility: HGB can be converted to leasehold agreements for additional security.
3. Establishing a PT PMA (Foreign-Owned Company)
- Definition: A corporate entity that allows foreigners to acquire freehold property indirectly.
- Key Advantage: Full ownership of land and structures under the company’s name.
- Requirements: Legal setup and compliance with Indonesian business regulations.
Bonus Tip: For investors planning large-scale developments, PT PMA is often the best route as it offers the most flexibility.
How Foreigners Can Secure Property in Lombok
Step-by-Step Guide:
- Engage Legal Experts: Work with property lawyers and notaries experienced in Indonesian law.
- Identify the Right Ownership Structure: Choose between leasehold, HGB, or PT PMA based on your investment goals.
- Conduct Due Diligence: Verify land titles, zoning regulations, and the property’s legal standing.
- Negotiate Terms: Clarify lease periods, renewal clauses, and other contractual details.
- Sign and Register Agreements: Finalize the deal with legal oversight to ensure compliance.
Additional Insight: It’s essential to visit the property in person to verify its condition, accessibility, and proximity to amenities.
Popular Areas for Foreign Investment in Lombok
- Kuta Lombok: Known for its thriving tourism and vibrant nightlife.
- Selong Belanak: Perfect for eco-tourism and premium developments.
- Tampah: An up-and-coming area with beautiful beaches and development potential.
- Are Guling: A quiet spot ideal for surfers and boutique developments.
Insider Tip: Emerging areas like Tampah often offer better value for long-term investments due to rising demand.

Tips for Foreigners Considering Property in Lombok
- Understand Legal Restrictions: Familiarize yourself with Indonesian property laws to avoid misunderstandings.
- Choose Reputable Partners: Work with licensed agents, developers, and legal professionals to safeguard your investment.
- Evaluate Long-Term Goals: Select ownership structures that align with your plans for the property.
- Plan for Renewal: If using leasehold or HGB, negotiate favorable renewal terms during the initial agreement.
- Prioritize Location: Invest in areas with robust tourism infrastructure and growing demand, such as Kuta and Selong Belanak.
- Leverage Local Knowledge: Speak to local experts to understand market trends, pricing, and future development plans.
FAQ: Freehold Property for Foreigners in Lombok
Can foreigners own freehold property in Lombok?
No, freehold ownership is restricted to Indonesian citizens. However, foreigners can use leasehold, HGB, or PT PMA structures to secure property.
What is the difference between freehold and leasehold?
Freehold provides permanent ownership, while leasehold grants usage rights for a specific period.
How secure are alternative ownership options?
Leasehold agreements, HGB titles, and PT PMA structures are legally recognized and provide security when managed correctly.
What are the renewal options for leasehold properties?
Renewal terms depend on the agreement, but most leasehold contracts allow for extensions up to 20-25 years.
About Nour Estates
We started Nour Estates with a simple idea: to make finding your dream land in Lombok as easy and enjoyable as a day at the beach. Our team is a mix of local folks and people from around the world who fell in love with Lombok like you. We’ve been in your shoes, faced the challenges of buying land here, and learned all the ins and outs. Now, we’re here to share that knowledge with you.
We are here to find you the perfect land to invest in. Contact us today, and let’s start this exciting journey together!
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