Makasih :)

Hi, Adeel, this villa was sold. We mentioned in the description that it is available as a rental through airbnb :) But also yes, the roof top can also support additional bedrooms!

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No problem! Did the video give you some valuable information?

Hi, Thanks for your insightful comment! Let's explore the comparison between freehold and leasehold properties in Bali, focusing on market prices, appreciation potential, and the financial dynamics over time. Market Price Comparison Freehold properties typically command higher prices than leasehold properties. For example, let's compare two comparable plots in a prime location: Freehold Plot: $550,000 Leasehold Plot (30 years): $300,000 Leasehold Premium While leasehold plots have a lower initial cost, they can offer a substantial ROI if managed correctly. The key advantage is the lower upfront investment, allowing you to allocate capital towards developing and maximizing the property's rental income. Appreciation Potential Freehold: Freehold properties do offer appreciation potential. However, the higher initial investment means it may take longer to see significant returns. Plus, the market can be unpredictable over long periods. Leasehold: Leasehold properties can provide impressive returns in a shorter time frame. With a strategic approach, such as focusing on high-occupancy rates and rental income, you can achieve strong ROI. When the lease term gets closer to ending, you can negotiate an extension with the landowner, often at a cost-effective rate compared to the initial cost. Conclusion Leasehold properties can be a savvy investment, especially if you're looking to maximize returns in a shorter time frame. The lower upfront cost, combined with the potential for high rental income, makes leasehold a compelling option. Plus, with the right strategy, negotiating an extension can be both feasible and beneficial. It's crucial to consider your investment goals and time horizon. If you have any more questions or need further details, feel free to ask! And for more insights on Bali real estate, don't forget to like and subscribe to our channel. Thanks for engaging with our content! 🌴🏡📈 Best,

@@dss3113 I can answer this question as my family just went through this issue last year. My son, who is an Indonesian citizen/WNI bought SHM or freehold property in one of the most sought after areas in Bali. A friend of ours, who is not Indonesian, was offered an adjacent plot of land (roughly the same size for the same price per sqm) but it had to be designated as ‘leasehold’ or HGB. The problem in Bali is that, for prime areas, Balinese landowners aren’t offering the property freehold but, rather hak sewa or HGB or leasehold. It’s smart for them as they get paid up front and in 25-30 years their heirs get paid again at the current market rate or the land reverts back to them. But if you are an Indonesian citizen it is much to your advantage to purchase SHM/ freehold as you realize the appreciation of the asset (both land and Villa) AND you control your operating license for short term leasing which also has to be acquired and held by an Indonesian citizen. In fairness to the original poster it doesn’t mean acquiring leasehold property in Bali isn’t still a good investment. As long as it’s a good location with a high occupancy rate you can easily get a 12-15% ROI. But you have to be VERY careful who you lease from and make sure the contract is very well written with adequate protections and provisions for the future extension. Best of luck to you 🙏🏻

@@jonlbdg Hi there, thanks for sharing and the insightful advice. Yes, me and my wife (Indonesian citizen) have both options and from an investment perspective I just see an appreciating asset vs a depreciating one. As we intend to keep the property long term I definitely think freehold is the way to go. And yes, I agree, leasehold still offers the potential for a decent ROI while opening up the possibility to a broader audience. However, if you have the option, I think it’s wise to capitalize on the full potential of the investment

@@thehousebali Thank you for getting back to me so quickly and the detailed answer 🙏🏻 Do you guys actually only specialize in villa sales or sell individual land plots as well?

@@dss3113 100% in your situation freehold/ SHM is the way to go… the foreigners who are opting for leasehold don’t realize the full value of the appreciating asset and will likely pay a very steep renewal fee. Good luck finding an SHM / freehold property in a desirable area. My son was lucky to find one 2km from bingin beach - our favorite area in Uluwatu. Make sure you also check the zoning to ensure it’s eligible for parawisata (I think that’s pink zone) and avoid the green zones as they don’t allow non- agricultural development… your wife can apply for the short term rental license… And lastly do your due diligence on the Hak Milik freehold certificate to make sure who the owners are and avoid any future claims from spouses… enjoy the process!

Hi, no it's sold and is now available as an airbnb rental!

Thankyou so much! Are you a fan of this type of interior design?

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Would you live in a villa like this?

@@thehousebaliabsolutely

haha, Bali is waiting for you!

Glad you liked it🥰😊

It’s a 5 bedroom villa, are you interested?😊

Thankyou so much for your input! You are absolutely correct. Even though nominee agreements are illegal and were very common in the past they are still being used today 😔 We hope that one day ressources and information will be made more transparent and accessible to Foreign investors!

Hi, the land tax can be paid through the land owner and the building tax as well with his NPWP number. In a standard leasehold contract he agrees to assist you with his ID number not only for the land/building tax but also for the commercial rental permit that will be needed for your future villa! Just FYI, Land/building tax is a cost much lower than what foreign investors expect. We just paid a year of land+building tax on one of our two bedroom villas and the total cost was less than 150 usd!

@@thehousebali If i make my own PT PMA this is also needed with the landlord NPWP number or can i then use the Tax id of the PT PMA company? Is there also and option 30 years leasehold + 30 years guaranteed extension at market rate. That have extra cost or not? If full furbished what would be the extra cost? The leasehold contract day will be the day when the construction is finished. Or it starts allready before in the contract?

@@GlobaladviceWorldwideif you are going to go through the trouble of setting up a PT/PMA then you have an option of acquiring land Hak Guna Bangunan (HGB) which gives you, under current law, 30 years + 20 years + 30 years for a total of 80 years… in this case, you are acquiring a right to develop the land and the land owner is the government. The only risk to the extension would be if the law were changed for the extension. As always, consult your legal advisor but it is an option you have and the extension is potentially must less expensive than paying a Bali landowner a ‘future market rate’ for an extension on a Hak Sewa leasehold…. Good luck in your property search 🙏🏻

Hi Jon! Thanks for your feedback, just wanted to get back to you concerning your points. 1) Absolutely correct, however, if the value of the land increases, the value of your property will also increases significantly. It goes hand in hand :) 2) Correct, you can't resell but you can Sublease the property. However you can absolutely resell with appreciation of the asset, especially with a 30 years leasehold. This is why we strongly advise acquiring a 30-year leasehold rather than a 25-year leasehold. Many brand-new properties on the market offer 25-year leaseholds, but we always push for 30-year leaseholds. Here’s why: First, properties tend to devalue when the leasehold drops below 20 years. A 19-year lease is considered a short leasehold, so 20 years is a mental barrier for many buyers. If you buy a 25-year leasehold and rent it out for 5 years, you’ll be left with 19 years. Even if market prices increase, your property’s value will struggle against the devaluation of a shorter leasehold. On the other hand, there’s no significant value difference between a 25-year and a 30-year leasehold in the market. This means you can rent out your property for 5 years and sell it with 25 years left, avoiding devaluation and benefiting from both the rising market price and the IRR (Internal Rate of Return). Furthermore, selling a property with proven income from the past 5 years is a great deal. Today, you’re buying a house, but in 5 years, you’re selling a business. The best strategy is to rent out your property for 5 years, reach a decent ROI, and then resell at market value, taking into account the business income and the increased market value. A 30-year leasehold period is more than enough time to maximize your ROI. You can fully capitalize on your investment well within this period. So, even if you do have to negotiate for an extension, the initial investment period gives you ample time to make a substantial return. To conclude, here is why we think leasehold opportunities are a much better investment than freehold in Bali, Indonesia: 1. Leasehold is a much more liquid investment, It will always be easier to resell or sublease a leasehold property for 3 reasons. One, there is a higher demand for leasehold properties among foreign investors. Two, The selling price will be at a more affordable price, which means a higher segment of the market will have a similar budget. Three, a leasehold property can be held under personal name, which means that it can easily be subleased. 2. Leasehold will pretty much always have a higher yearly ROI 3. A leasehold acquisition is a much easier and low-risk process for any foreigners regardless of their nationality. To acquire a leasehold villa, you do not need to create a PT.PMA and you can own it under your personal name. Hope this gives you an idea of our point of view concerning the current real estate market and leasehold investment in Bali. We'd love to hear your thoughts!

@@thehousebali well as I said in my earlier post it’s ALWAYS better to hold property freehold / SHM as you directly realize the appreciation of the asset and can sell the land/ villa anytime you want - and for a MUCH higher value in the future than sub leasing leasehold property which is a depreciating asset. But for foreigners they can’t hold SHM- only Hak Sewa or HGB if they setup a PT/PMA - and both are still leasehold. In the case of my son (who is WNI) he bought freehold/ SHM 2km from Bingin beach for the same price they were offering org asing a 30 year lease AND when he develops the land he will be able to lease it out short term, long term or sell it for a considerable profit. As I said before, I do think a 12-15% ROI is still a good investment for foreigners as long as they are comfortable paying a very high renewal fee in the future or don’t have plans to leave the property to their heirs… so I guess we can agree on that point 🙏🏻

@jonlbdg Was this contract negotiated in the beginning before you bought the place? Like you put that clause into the contract? Or was this contract Later on, when you have to deal with the renewal process? I just want to be clear because i'm actually very serious about owning property here. Thirty years from now, I'll be in my seventies. That's why I like to renew And not be left with nothing. I can't just start over from there. Thank you for the reply in the details. It has been very helpful in giving me a lot of new ideas.

@@johnelite in the example I gave before my son, who is an Indonesian citizen, bought the property SHM- Hak Milik- Freehold so it wasn’t a leasehold contract with the previous owner but a straight sale and transfer of title. In the case of a leasehold contracts if you follow the standard practice in Bali it’s Hak Sewa or Leashold with a Balinese land owner and you can include an extension clause after 30 years BUT they will normally use language like ‘at the prevailing market rate’ to determine the extension in the future. I’ve been in Indonesia since 2004 and most land values in prime areas have gone up by 10x or more in 20 years. The other thing you have to consider is whether the Bali land owners heirs will honor the contract or agree to extend it after 30 years. So choose your property owner carefully and, if possible, try to include language in the contract which references the extension and heirs to the property. If done properly with the right property agent - like the moderators company-a good notaris to check the certificates and a well crafted contract you can get a reasonable return on your investment- best of luck to you! 🙏🏻

@jonlbdg Thank you very much. Your information and wisdom is much appreciated.

Hi John, excellent question. First of all, we apologize for not covering this aspect in the video as it can be quite controversial but we'd like to also hear your thoughts on this as well. First, let's look at the reasons why a land owner would refuse an extension and demand his land back. 1. He would like to build something on his land, commercial or personal. 2. He expects to get some sort of value back and hoping you'd leave the building on his land. In a standard contract, you leased only the land and the building you've built/bought on it belongs to you. You would be allowed to demolish the house which will devaluate the worth of his land since it will increase his future use/construction cost. There would be some left over foundation work in the ground which would have to be reworked if he decided to make use of his land. In most circumstances we've seen, at the end of a long leasehold, local landowners are in need of cash. On another note, this is why we are not a fan of renovation projects in Bali. When you lease a land with a building already on it directly from the land owner, you would not be allowed to destroy it which would leave you with no leverage. Back to the original point, at the end of a land lease where you own the building, the land owner has incentive to propose an extension above market price because he has some leverage, but even if it's slightly above market price, market price for the land is only a fraction of the total value of the property. In a normal case, there are incentives and leverage on both sides to lead to a leasehold extension. (Even if you've already gotten a great return on investment, leasehold opportunities in Bali are why it's so profitable). But this is one of the main risks. If the land owner refuses to extend with no option of negotiation, the land would go back to them. If you own the building, it is your choice to demolish it or not, if it matches with your contractual agreement. From our point of view, we (As a foreign+locally owned company) are grateful to be able to conduct business on this amazing Island and we accept the fact the land will eventually go back to the people. The Balinese people have an amazing and unique culture that is closely connected to their land and traditions. It's important that their rights remain exclusive to them to protect their heritage. If foreigners had unrestricted access to own land permanently, it could raise property prices and displace local residents, disrupting the balance of their communities. Please let me know your thoughts!

I negotiated the price of the extension, and wrote it into the lease with a maximum mark up of approx 30 % of the land value for another 25yr period

Hi Franky, that's actually an excellent deal you got! It is usually quite hard/rare to be able to negotiate such a clause. You must have some amazing negotiation skills :)

​@@thehousebali If an extension was to be rejected, I would most certainly demolish the house. By denying me an extension the landowner will not enjoy financial gain from my home.

You are free to do so if the contractual terms let you :)

It will be completed around 2-3 months. Regarding the lease, the 30-year lease typically starts from the date of the actual completion and handover of the property.

We have another similar villa with a similar price, contact us at api.whatsapp.com/message/QO6HA2FWSPFVA1?autoload=1&app_absent=0

Thank you!😊

Unfortunately this one is already sold but we have other villa, contact us at api.whatsapp.com/message/QO6HA2FWSPFVA1?autoload=1&app_absent=0

Yes, the airbnb link is on description!😊

Glad you think so!

Sure, here's a draft response to the KZbin video comment: Great question! Here's a typical breakdown of the financial steps for purchasing a villa: 1. Deposit: 10% of the total price is paid upfront as a deposit. 2. Construction Milestones: Payments are then tied to construction milestones. For example: - Foundation completion: 20% - Structure completion: 20% - Roofing and exterior work: 20% - Interior work and finishing: 20% 3. Final Payment: The remaining 10% is paid once the villa is delivered and the keys are handed over. This structure ensures that payments are aligned with the progress of the construction, giving you confidence that your investment is being managed properly. Hope this helps!

Yes! Please whatsapp us at api.whatsapp.com/message/QO6HA2FWSPFVA1?autoload=1&app_absent=0

You can contact us! api.whatsapp.com/message/QO6HA2FWSPFVA1?autoload=1&app_absent=0

thanks!

Thanks!🥰

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thanks

Thanks for your feedback! ☺️😋

Wow, thank you! 😊

Thanks :) glad we can help!

Merci 🥰