Lombok is quickly becoming one of Indonesia’s top destinations for real estate investment. With its unspoiled beaches, growing tourism infrastructure, and lower prices compared to Bali, foreign investors and lifestyle buyers are increasingly looking to buy villas in Lombok. But the process of buying property in Indonesia as a foreigner comes with legal restrictions and specific ownership models. This guide explains everything you need to know, including Hak Pakai, PT PMA, and the role of the BKPM and Notaris in making your Lombok property purchase legal and secure.
Can Foreigners Buy Property in Indonesia?
Yes, foreigners can buy property in Indonesia, including in Lombok. However, there are important restrictions on direct land ownership. Unlike Indonesian citizens, foreigners cannot own Hak Milik (freehold) titles in their own names.
That said, there are legal frameworks that allow foreigners to control and use property safely:
- Hak Pakai (Right to Use) – most common for residential buyers.
- Leasehold – long-term leases of 25–30+ years.
- PT PMA – a foreign-owned company that can hold freehold titles.
Each option has different legal and financial implications. Choosing the right structure depends on your purpose — whether you're buying for personal use, investment, or development.
Legal Ownership Structures for Foreign Buyers in Lombok
Hak Pakai (Right to Use)
Hak Pakai is the most secure and government-approved title for foreigners looking to own a residential property in Indonesia.
- Typically valid for 25 years, renewable for up to 80 years.
- Can only be used for residential purposes (not commercial).
- Must be registered through the Indonesia Investment Coordinating Board (BKPM).
- Can only be granted on land with a valid Hak Milik title converted for this purpose.
➡️ Ideal for expats looking to live in Lombok or own a holiday home.
Leasehold (Hak Sewa)
Leasehold (Hak Sewa) allows foreigners to lease property from an Indonesian owner for a fixed period.
- Terms usually range from 25 to 30 years, often extendable.
- Does not require a PT PMA or special permit.
- Common in tourist areas like Kuta Lombok, Senggigi, and Selong Belanak.
➡️ Suitable for those looking for a simpler, faster purchase for vacation or short-term rental.
HGB through PT PMA (Foreign-Owned Company)
Foreign investors can establish a PT PMA (Penanaman Modal Asing), a company registered in Indonesia, to own land under a freehold (Hak Milik) structure. The freehold title is then converted into an HGB (Hak Guna Bangunan) title, which grants your PT PMA the right to build on and commercially use the land.
- Requires company formation and approval by BKPM.
- Allows for full property control under the company’s name.
- Suitable for investments, commercial villas, or development projects.
➡️ Best for investors planning to operate a business or hold multiple properties.
Key Legal Terms You Should Know
HGB (Hak Guna Bangunan) Right to Build – allows a PT PMA to build on and commercially use the land.
Hak Milik Freehold title – only for Indonesian citizens.
Hak Pakai Right to Use title – available to foreigners for residential use.
Hak Sewa (Leasehold) Lease agreement – gives the right to use land for a fixed term.
PT PMA Foreign-owned company that can hold property.
Notaris (PPAT) Licensed legal official who oversees land transactions.
BKPM Government agency regulating foreign investment.
BPN National Land Agency responsible for title registration.
Step-by-Step: How to Buy Property in Lombok as a Foreigner
Here’s a typical legal process for buying a villa or land in Lombok as a foreign buyer:
1. Choose a Property
Decide on your preferred location — such as Kuta Lombok, Mandalika, or Gili Air — based on your goals (residential vs. rental investment). Make sure the land is properly zoned (check RTRW regulations).
2. Due Diligence & Title Search
- Work with a qualified Notaris (PPAT) to:
- Verify ownership documents.
- Check for encumbrances.
- Confirm the land certificate (e.g., SHM, HGB).
3. Set Up PT PMA (if needed)
If buying through a company, your lawyer will register a PT PMA with the BKPM and obtain the necessary permits.
4. Sign the Purchase Agreement
This is done at a Notaris office, where all legal paperwork is finalized and witnessed.
5. Title Transfer & Registration
The transaction is recorded with the National Land Agency (BPN), and the appropriate ownership certificate is issued (Hak Pakai, Leasehold, or Hak Milik under PT PMA).
Risks to Avoid When Buying Property in Lombok
- Illegal nominee arrangements (having a local “own” the land on your behalf).
- Unclear zoning or improperly converted land titles.
- Lack of due diligence on land status or seller legitimacy.
- Unlicensed developers with off-plan risks.
Always use a licensed Notaris (PPAT) and consult a legal advisor familiar with Indonesian property law.
Why Foreigners Are Buying in Lombok
Lombok offers:
- Lower property prices than Bali.
- Strong investment potential via Airbnb and long-term rentals.
- Access to government-backed tourism areas like Mandalika SEZ.
- Growing appeal to digital nomads, retirees, and remote investors.
Frequently Asked Questions (FAQ)
Can foreigners buy land in Lombok?
Foreigners cannot directly own land under Hak Milik but can buy under Hak Pakai, Leasehold, or via PT PMA.
What’s the difference between Hak Pakai and Leasehold?
Hak Pakai is a government-granted title with renewable terms. Leasehold is a private agreement between buyer and landowner.
Do I need a local partner to set up a PT PMA?
No, a PT PMA can be 100% foreign-owned, but must be registered and licensed via BKPM.
How long does it take to buy a villa in Lombok?
The full process (due diligence, legal review, setup) can take 4–8 weeks.
Is it safe to invest in Lombok property?
Yes, with proper legal support and verified titles, Lombok is a safe and growing market for foreign investors.
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