Creating Freehold Villa Projects

When buying a villa at Lombok Villas, you also sign a Property Management (PM) agreement for three years. After three years you can extend or choose another PM.
The PM will rent the villa to tourists and will take care of the maintenance of your villa so it stays top-notch. You won’t have to worry about renting it out yourself. The profit minus the cost will be transferred to your Indonesian bank account, or any other bank account of your liking.

The PM we work with charges 15% of the revenue. Most property management companies in Bali and Lombok charge 20%.
This is one of the benefits of buying a freehold villa at Lombok Villas.

While the villa is yours, the goal is to maximize profit for you and the other villa owners.
With this in mind, here is the policy for using your villa:

• In September when the MotoGP visits Kuta, you cannot use the villa.

• In the high season (July and August) you can use it for a week free of charge.

• Outside the high season you can use your villa up to maximum 3 weeks free of charge.

Indonesia has strict land ownership laws, meaning foreigners cannot directly own freehold land (Hak Milik). However, foreigners can still legally invest in property through other structures:

• Leasehold (Hak Sewa) – Long-term property lease

• PT PMA (Foreign-Owned Company) – Own land & buildings under a business entity

Each method has its own advantages and legal requirements.

Option 1: Leasehold (Hak Sewa)

• Foreigners can lease land or property for 25 years or longer.

• No Indonesian partner or company is required.

🔹 How it works:

• A leasehold agreement is made with the landowner for 25-30 years, with renewal options.

• Foreigners have full rights to develop and start a business or otherwise.

• Leasehold properties can appreciate in value and be resold. Keep in mind that potential buyers may request an extension of the lease period, which will involve additional costs.

• It is crucial that the agreement with the landowner is thorough and legally sound to prevent any issues, such as the landowner terminating the lease after significant investments have been made.

Option 2: PT PMA (Foreign-Owned Company)

• The safest way for foreigners to own property in Indonesia.

• PT PMA (Penanaman Modal Asing) allows foreign business ownership.

🔹 How it works:

• A PT PMA companyis established in Indonesia.

• The company can purchase and develop property legally.

• Best for:Investors looking to own land, develop commercial properties, or run a rental business legally.

At Lombok Houses we work with Freehold ownership and arrange the PMA for our buyers at our trusted Notary.

Usually this takes 4-6 weeks. Buyers at Lombok Villas are assisted by us and connected to our trusted Notary and legal counsel. The cost of PMA setup is around €1.500,-