Buying And Selling Advice In Bali

Buying Real Estate in Bali: Steps to Ensure a Smooth Transaction

1. Making an Offer

Start by informing PROPERTIA BALI of your intention to make an offer. Emphasize your keen interest by requesting to sign the ‘Intend To Purchase’ (ITP) contract. This signifies your seriousness to both the agent and the seller. After signing the ITP, PROPERTIA BALI will present the offer to the seller. A mutually signed ITP indicates a successful negotiation.

NOTE: Even if you’ve seen a property with a different agent, PROPERTIA BALI can still assist with the purchase. Reach out, and we promise a seamless and professional buying experience.

2. Choosing a Notary

The buyer must select a notary. This notary typically charges between 0.8% and 1% of the agreed selling price. This individual will draft a detailed sales and purchase agreement in both Indonesian and English — ensuring legal binding in both languages.

3. Deposit Transfer

The standard deposit, generally 10% of the property price, should be transferred and held in the notary’s escrow account. Always avoid paying the deposit directly to the seller or the agent. Upon receiving the deposit, the seller is then obligated to remove the property listing from the market.

4. Signing Preliminary Agreements

Once price negotiations and conditions are settled, both parties will sign a binding sale and purchase or leasehold right agreement, solidifying the terms of the transaction.

5. Conducting Due Diligence

After sealing the preliminary agreement, the buyer, through a legal representative or notary, should investigate the property’s credentials. This process is usually conducted by the chosen notaries and takes around 2-3 weeks.

6. Finalizing the Acquisition

To finalize the property acquisition, both parties will enter into official notarial documents. Until the full payment is settled and all prerequisites are met, the notary keeps all property-related certificates or deeds in escrow.

7. Transferring Property Title

Upon full payment receipt and settlement of all transaction-related taxes, the property title is transferred. The deeds are then released to the concerned parties.

Selling Real Estate in Bali: Key Points to Remember

1. Selecting the Right Agent

Navigating Bali’s property market can be challenging. The choice of a real estate agent is crucial. While multiple listings with various agents are possible, it’s advisable to opt for 3-4 agents you trust and believe will professionally represent you.

2. Understand the Costs

Beyond the agent’s fee, selling property in Bali incurs other charges, especially tax-related ones.

3. Legal and Taxation Implications

Like other countries, Indonesia has tax obligations for foreign investors. It’s paramount to consult with a qualified legal advisor or lawyer.

4. Tax Breakdown

Depending on the property type (freehold or leasehold), sellers will encounter different tax rates:

– Leasehold property or land: 10% income tax (PPH)
– Land & Building tax must be settled before the property or land sale.

– Freehold property or land: 2.5% income tax (PPH)
– Again, the Land & Building tax must be up-to-date before sale.

Disclaimer: The information presented here serves as a general guide and shouldn’t be considered as legal or taxation advice. Always consult with qualified advisors about Indonesian legal, regulatory, and taxation obligations before any transaction.

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