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Bali Real Estate demand and prices directly related to Tourism
Bali, Dec 5, 2003 The demand for Bali Real Estate is directly proportional to tourist arrivals. The more tourists in Bali means more foreigners who wake up one morning at their end of there trip realizing that they have to go back to their smog-filled stressful lifestyles and they wonder if they can own a property in Bali for pleasure and investment. As the first wave of the renewed tourism prepares to return home, they start to daydream about living part time or full time on a
paradise island such as Bali. 
Business people and investors cannot help but contemplate the fact that they see a lot of potential in Bali and wonder, if there is some way that they can own investment rental properties in Bali. Martha tells George (hypothetical tourists) that they should buy a place in Bali and rent it out when they are not here. As they begin to ask questions about prices and ownership, they are
discouraged when they discover that foreign individuals cannot own land in Indonesia. Foreign individuals cannot own land in Indonesia.
Although there are on-going discussions about changing this law, it is not likely to be changed soon. There are several legal methods around this around this issue.  One popular method is whereby an Indonesian citizen holds the interest in the property as a nominee on behalf of the foreigner, and the title will be made out in the Indonesian's name.
If an Indonesian acts as a nominee for a foreign investor, there are a number of contracts and other documents, which must be prepared by and signed in front of a qualified notary to protect the foreigners’ investment.
These include but are not limited to, (1) A Purchase Contract for the property, transferring the rights from the previous owner to the nominee. (2) A Loan Agreement for the purchase between the investor and the nominee.
(3) An irrevocable and transferable Power of Attorney to sell, transfer or otherwise dispose of the property and to represent the nominee in any dispute regarding the property, given from the nominee to the investor.
(4) The nominee will also be asked to hand over all original land titles to the foreigner. In essence, the Indonesian is owner in name only. To the best of our knowledge, those who have utilized this type of purchase, when set up with a professional attorney and notaries, have had no problems. The fees for setting up a nominee system may vary from 1% to 2 % of the value of the property. Leasing
of land does not require a nominee and is very easy. Land is normally leased for 20 to 30 years with an option to extend. The old saying applies to foreign ownership as to most business ventures "if it was easy, everyone would be doing it’. "if it was easy, everyone would be doing it’. The fact that it takes some time and expertise has curtailed large speculation of Balinese property keeping prices at a small fraction of similar properties on other
major tourist islands around the world. As more and more foreigners discover that they can enjoy pleasure, and substantial profit by purchasing or leasing Bali real estate, prices will probably escalate more rapidly in the future.
 Merry Christmas
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