Is Foreign Citizens Permitted to Buy an Apartments in Indonesia?

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By:

Team of Hukumindo

Previously, the www.hukumindo.com platform has talk about "Variety of Apartment Ownership Rights in Indonesia", "What Types of Land Ownership May Company Obtain In Indonesia?", you may read also "How To Buy Land In Indonesia?" and on this occasion we will discuss about 'Is Foreign Citizens Permitted To Buy an Apartments in Indonesia?'.

As we know that vertical housing such as apartments offers various conveniences to its consumers, especially for the upper and middle segment, which generally prioritizes premium locations. Its strategic location, such as in the middle of the city, is also supported by various capable facilities, making it a residence that is the target of the economically well-off. This kind of housing targets one of its segments, namely expatriates.

What Is Foreign Citizens?

A foreign citizen is a person who lives and domicile in a certain country but is not a citizen of that country, nor is he officially registered as a citizen, such person has various purposes, for example in the context of pursuing education, business or other things. Even though the status of a person is a foreign citizen in Indonesia, that person still has rights and obligations to the country he lives in.[1]

Thus, what is meant by foreign nationals are citizens who hold citizenship outside their current domicile, for example Indonesia, for certain purposes such as study, business, work or other legitimate interests. In the context of this article, what is often the share of the apartment market in Indonesia is expatriates. Expatriate is often used to refer to a highly educated and wealthy foreign worker. Generally work as top management of a particular company.

What Is Apartments According To Indonesia Law?

The definition of flats according to Article 1 point 1 of Law Number 16 of 1985 concerning Flats are: “Bangunan gedung bertingkat yang dibangun dalam suatu lingkungan, yang terbagi dalam bagian-bagian yang distrukturkan secara fungsional dalam arah horizontal maupun vertikal dan merupakan satuan-satuan yang masing-masing dapat dimiliki dan digunakan secara terpisah, terutama untuk tempat hunian, yang dilengkapi dengan bagian bersama, benda bersama, dan tanah bersama”. When translated into English, it roughly has the following meanings:[2]

"Multi-storey buildings built in an environment, which are divided into functionally structured parts in horizontal and vertical directions and are units that each can be owned and used separately, especially for residential areas, which are equipped with shared parts, common things, and common land."

In simple terms, an apartment is a multi-storey building, the term apartment is often distinguished from a landed house, for the author the difference is that the function of the building is made up, not to the side.

Is Foreign Citizens Permitted to Buy an Apartments in Indonesia?

The answer to the question "Is Foreign Citizens Permitted to Buy an Apartments in Indonesia?" is YES legally allowed. The legal basis is Law Number: 1 of 1974 concerning Agrarian Principles, then Law Number: 11 of 2020 concerning Job Creation. 

President Joko Widodo has issued Government Regulation (PP) Number 18 of 2021 concerning Management Rights, Land Rights, Flat Units, and Land Registration. This Government Regulation has been officially enacted since February 2, 2021. This Government Regulation Number 18 of 2021 states that foreigners or foreign citizens can own a condominium unit (flat unit). A number of articles that regulate the ownership of condominiums or apartments by foreigners are included in Chapter V which regulates Flat Units.[3]

Article 67 which is included in the first part explains the subject of property rights to the apartment unit, this article has three paragraphs, the rules read:[4]

1. “Ownership rights to apartment units are given to Indonesian citizens (WNI); Indonesian legal entity;
2. Foreigners who have permits in accordance with the provisions of laws and regulations; foreign legal entities that have representatives in Indonesia;
3. Or representatives of foreign countries and international institutions that are or have representatives in Indonesia".

There are several important requirements for a foreign citizen to be able to buy an apartment in Indonesia, as for these conditions are as follows:[5]

1. Have immigration documents in accordance with the provisions of the legislation;
2. For apartments that can be owned, the property is built on usufructuary rights (hak pakai) or building use rights on state land, land with management rights, or property rights;
3. The apartment is located in a special economic area, a free trade area and free port, an industrial area, and other economic areas;
4. This government regulation also stipulates that foreigners who buy property in Indonesia have a minimum price limit, land area, number of plots, and allotment.

If we look at some of the conditions above, the most important thing here is that foreign nationals living in Indonesia are those who enter legally with official immigration documents. Apartments that can be purchased are also only those that stand on certain rights, such as use rights, building rights, management rights and property rights. The apartment in question is built in a special area, such as a special economic zone or free trade. Not only that, apartments that can be purchased also have their own rules such as minimum price, area of ​​land, number of fields and also their designation. This rule is further regulated in a Ministerial regulation. And if you have any legal issue with this topic, contact us then, feel free in 24 hour, we will be happy to assist you. 

*) For further information please contact:

Mahmud Kusuma Advocate

Law Office

Jakarta - Indonesia.

E-mail: mahmudkusuma22@gmail.com

________________

References:

1. "Pengertian Warga Negara Asing di Indonesia", guruppkn.com., Diakses pada tanggal 6 Agustus 2022, https://guruppkn.com/pengertian-warga-negara-asing

2. Law number: 16 of 1985 concerning Flats.

3. "WNA Beli Properti di Indonesia? Boleh Saja Tapi Ada Syaratnya. Yuk, Cari Tahu", rumah123.com., Diakses pada tanggal 6 Agustus 2022, https://artikel.rumah123.com/wna-beli-properti-di-indonesia-boleh-saja-tapi-ada-syaratnya-yuk-cari-tahu-82623

4. Ibid.

5. Ibid.