The Ministry of Agrarian Affairs and Spatial Planning/National Land Agency has made a significant revelation regarding property ownership in Indonesia. Foreigners can now become property owners in the country by simply presenting their passports or visas. This marks a departure from previous regulations, where foreign investors were required to obtain a Limited Stay Permit Card (KITAS) and a Permanent Stay Permit Card (KITAP) before being eligible for property ownership.
The Secretary General of the Ministry of Agrarian Affairs, Suyus Windayana, clarified the matter, stating that the KITAS and KITAP will now be granted to foreigners after they have successfully purchased or acquired property in Indonesia.
Nevertheless, there are specific minimum price thresholds that foreigners must adhere to when purchasing a property. For landed houses, the minimum price averages around Rp5 billion, while flats require a minimum of Rp3 billion, according to Windayana.
These measures signify the Indonesian government’s efforts to facilitate and encourage property ownership for foreign investors. By streamlining the process, the country aims to attract more foreign investments and enhance its competitiveness on the global stage. The government also contemplates allowing larger land ownership areas, beyond the current limit of 2,000 m2, for foreigners who can demonstrate positive economic and social impacts, subject to ministerial approval.
Through such initiatives, the Indonesian government aims to boost economic growth, create job opportunities, and foster overall development. This move is seen as a progressive step towards attracting more foreign investments and promoting economic prosperity in Indonesia.
Property Ownership in Indonesia: Minimum Prices and Land Limitations
Foreigners interested in property ownership in Indonesia must take note of the minimum price thresholds for both landed houses and flats in various regions. Here is a breakdown of the minimum prices:
- DKI Jakarta: Rp5 billion
- Banten: Rp5 billion
- West Java: Rp5 billion
- Central Java: Rp5 billion
- East Java: Rp5 billion
- Special Region of Yogyakarta: Rp5 billion
- Bali: Rp5 billion
- West Nusa Tenggara: Rp3 billion
- North Sumatra: Rp2 billion
- East Kalimantan: Rp2 billion
- South Sulawesi: Rp2 billion
- Riau Archipelago: Rp2 billion
- Other regions or provinces: Rp1 billion
- DKI Jakarta: Rp3 billion
- Banten: Rp2 billion
- West Java: Rp2 billion
- Central Java: Rp2 billion
- East Java: Rp2 billion
- Bali: Rp2 billion
- Special Region of Yogyakarta: Rp2 billion
- Other regions or provinces: Rp1 billion
Furthermore, there is a maximum limit to the land measurement allowed for residential ownership by foreigners, set at 2,000 m2. Foreigners are temporarily allowed to own a plot of land per family with an area no larger than 2,000 m2. However, if their ownership can bring positive economic and/or social impacts, there is a possibility of obtaining more land area with the minister’s permission.
Property Ownership Boosting Indonesia’s Global Competitiveness and economic growth
In Indonesia, the ownership of residential and other properties by foreign investors is seen as a catalyst to enhance the country’s competitiveness on the global stage. The government expresses unwavering confidence that the active presence of foreigners engaged in various activities within Indonesia can elevate its competitive standing, even when compared to dynamic economies like Singapore, Malaysia, and Thailand.
A crucial step taken by the Indonesian government to boost economic growth and attract foreign investments is to create an expansive market, particularly encouraging foreign investors to invest generously in Indonesia. This ambitious approach not only creates ample opportunities for job creation but also initiates a multiplier effect, which significantly contributes to the enhancement of the national economy.
As part of its commitment to fostering economic recovery and transformation, the government has undertaken robust efforts to reform regulations. The groundbreaking Job Creation Law serves as a powerful instrument in this regard, promoting a business-friendly environment and paving the way for Indonesia’s economic rejuvenation.
Emphasizing their dedication to facilitating ease of property ownership for foreign citizens, encompassing both residential and vertical housing, the Ministry of Agrarian Affairs plays a pivotal role in supporting the government’s visionary initiatives.
Through these proactive measures and strategic policies, Indonesia is set to become an appealing and competitive destination for foreign investors, ensuring sustainable growth and a thriving property market that fuels the nation’s progress and prosperity.
A Conducive Environment for Foreign Investors in Indonesia
“The Ministry of Agrarian Affairs, responsible for the agrarian and land sector, wholeheartedly supports the government’s initiatives to streamline property ownership for foreign citizens, encompassing both residential and vertical housing options,” affirmed the official.
To further facilitate property ownership in Indonesia, the government, through the Ministry of Agrarian Affairs, has issued essential regulations. Among these are Government Regulation Number 18 of 2021, which addresses Management Rights, Land Rights, Flats Units, and Land Registration, along with Regulation of the Minister of Agrarian Affairs and Spatial Planning/Head of the National Land Agency of the Republic of Indonesia Number 18 of 2021, focused on Planning Means of Determining Management Rights and Land Rights. Additionally, Ministerial Decree ATR/KBPN No.1241/SK-HK.02/IX/2022, dated 2022, specifically deals with the acquisition and pricing of residential and dwelling houses for foreigners.
Through these regulations, the Indonesian government aims to create a conducive environment for foreign property ownership, encouraging investment and contributing to the overall development of the country’s real estate sector. These efforts reflect the nation’s commitment to fostering economic growth, attracting foreign investors, and promoting a vibrant and competitive property market in Indonesia.
These regulations aim to balance foreign investments in the property market while ensuring that ownership remains controlled and beneficial to the overall development and growth of Indonesia’s economy.
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