Step-by-Step Guide to Building a House in Bali
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🏠 Step-by-Step Guide to Building a House in Bali
Bali is one of the most sought-after destinations for homeowners and investors worldwide. Its unique mix of tropical beauty, vibrant culture, and growing real estate opportunities make it a dream location to build a home. However, the process involves several legal, architectural, and logistical steps that are crucial to understand before starting.
🌴 1. Understand Land Ownership Rules
Foreigners cannot directly own land in Bali under Indonesian law. However, there are legal structures that allow property rights:
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Hak Pakai (Right to Use): Allows foreigners to use land for up to 30 years, extendable up to 80 years.
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Hak Sewa (Leasehold): You lease land from the owner (usually for 25–30 years) and can build your property on it.
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PT PMA (Foreign-Owned Company): If you set up a PT PMA, the company can hold land under a “Right to Build” (Hak Guna Bangunan).
💡 Tip: Always consult with a notary (PPAT) or legal advisor specializing in Bali property law before signing any land agreement.
🧱 2. Conduct Land Due Diligence
Before buying or leasing:
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Verify the land certificate (Sertifikat Tanah) from the National Land Agency (BPN).
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Check zoning regulations (Zonasi) — certain zones only allow residential or tourism-related buildings.
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Ensure no disputes or overlapping ownership claims.
🧩 3. Obtain Building Permits (IMB or PBG)
As of 2021, Indonesia replaced the IMB (Izin Mendirikan Bangunan) with PBG (Persetujuan Bangunan Gedung).
You must secure:
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PBG (Building Approval)
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SLF (Feasibility Certificate) after construction completion
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Environmental Impact Approval (AMDAL) if your project is large-scale
⚙️ These are mandatory for connecting utilities and obtaining legal recognition of the building.
🏗️ 4. Hire a Professional Team
Your project should include:
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Architect & Structural Engineer: To design according to local climate and cultural aesthetics.
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Notary: To handle land transactions and document validation.
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Contractor & Project Manager: To manage on-site work and timelines.
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Surveyor: To confirm boundaries and terrain levels.
Choose professionals with proven experience in Bali to navigate local building codes and materials.
🪵 5. Design & Construction Phase
Consider:
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Balinese architectural harmony: Tri Hita Karana philosophy emphasizes harmony between humans, nature, and the divine.
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Materials: Teak wood, bamboo, and volcanic stone are popular sustainable materials.
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Weatherproofing: Adapt designs for tropical humidity, rain, and salt air if near the coast.
Ensure periodic site inspections and clear payment schedules with your contractor.
🪙 6. Budgeting & Taxes
Your total cost may include:
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Land lease/purchase
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Permit and legal fees
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Architect and contractor fees
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Construction costs (typically USD 600–1,500/m² depending on quality)
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Taxes: 10% VAT for new builds, and income tax (2.5%) on property sales.
💰 Pro tip: Have a contingency of at least 10–15% for unforeseen expenses.
🧾 7. Register the Completed Building
After completion:
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Obtain the SLF certificate
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Register your property with the BPN (National Land Agency)
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Set up utility connections (electricity, water, internet)
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For rental properties, apply for tourism licenses (if applicable)
❓ FAQ: Building a House in Bali 🏡 Can foreigners legally own property in Bali?
Not directly — but foreigners can lease land or own through a PT PMA company.
⏳ How long does it take to build a house in Bali?Typically 12–18 months, depending on design complexity, permit processing, and weather.
💵 How much does it cost to build?Around USD 600–1,500 per square meter, excluding land costs.
🧾 Do I need a local partner?If you’re using a leasehold or Hak Pakai title, not necessarily. But for a PT PMA, an Indonesian notary and legal representative are required.
⚖️ Is it safe to invest in Bali real estate?Yes — with proper legal due diligence and verified land titles. Avoid informal agreements or “nominee” ownership structures.
🌿 Can I build an eco-friendly villa?Absolutely! Bamboo architecture and green building materials are widely supported in Bali’s design community.
🧭 Final Thoughts
Building a house in Bali can be a fulfilling journey — combining tropical living with smart investment. The key is thorough preparation: understand the legal framework, hire trusted local professionals, and maintain clear documentation from start to finish.
