Mortgage in Indonesia in 2025
Full foreign ownership of land and real estate in Indonesia is generally prohibited. As a result, conventional mortgages secured by property are inaccessible to foreigners. Without full ownership rights, foreigners cannot obtain loans for housing.
One alternative for foreign investors is instalment plans from developers. These programmes allow foreign investors to finance property purchases on more favourable terms, offering a convenient payment plan during the construction period.
From Colonial Imbalances to Citizen-Centric Policies: Real Estate Regulations in Indonesia
The policy of restricting foreign ownership of real estate and access to mortgages in Indonesia is based on historical experience, economic policies, and the commitment to protect citizens’ interests.
During the colonial era, foreign ownership of Indonesian land led to significant economic and social imbalances due to the lack of control over the land by Indonesian citizens. Following its independence in 1945, Indonesia prioritised private land ownership for its citizens as a means of addressing the imbalances that had been created during the colonial era.
Indonesian Mortgage Law
The Basic Agrarian Law (Law No. 5 of 1960) places restrictions on foreign ownership of real estate in Indonesia. In particular, it allows only Indonesian citizens and legal entities to fully own land.
Foreigners can enter into long-term land leases, but cannot directly own freehold properties.
The 1996 Law UU Nomor 4 Tahun outlines the mortgage (Hak Tanggungan) regulations for foreigners, allowing them to be involved in mortgage agreements if the loan is used for real estate construction in Indonesia (Article 10, Paragraph 1).
From $120,000
Yield 10.0% Completion in: 2027.II
From $125,000
Completion in: 2027.I 123 units in total
From $147,000
Completion in: 2027.I 66 units in total
From $179,000
Yield 12.8% Completion in: 2025.I
From $144,000
Completion in: 2025.IV Total of 103 apartments
From $210,000
Completion in: 2027.IV 315 units in total
From $98,000
Completion in: 2027.I Total of 58 apartments
Instalments as an alternative to mortgages in Indonesia
In Indonesia, developers are offering instalment plans as an alternative to mortgages for foreign buyers. These plans facilitate the de-facto bypassing of ad hoc bureaucratic obstacles, thus creating transparent and favourable conditions for property purchases.
Instalment terms, including interest and payment schedules, are agreed upon individually with developers.
In Indonesia, instalment plans are often interest-free, with payments spread over months or years without additional surcharges and rates.
Common Instalment Plans in Indonesia
Downpayment
During construction
Upon handover
From $125,000
Completion in: 2027.I 123 units in total
From $147,000
Completion in: 2027.I 66 units in total
From $179,000
Yield 12.8% Completion in: 2025.I
From $210,000
Completion in: 2027.IV 315 units in total
From $156,000
Completion in: 2026.III 42 units in total
From $185,000
Completion in: 2026.II 49 units in total
From $350,000
Yield 16.0% 51 units in total
From $261,000
Completion in: 2025.I 17 units in total
Property Purchase in Indonesia for Foreigners
Purchasing property in Indonesia is a straightforward process, requiring only a passport with at least six months of validity.
The entire transaction can be completed remotely. Contact our experts to find property in Indonesia online.
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Once all agreements have been finalised, the investor and developer enter into a contract that outlines each party’s obligations, the property transfer process, and the payment procedure.
It is common for developers to offer management services for the property, which are regulated by a separate agreement if the investor plans to transfer management responsibility.
Once the purchase has been completed and the final instalment has been paid, the sales contract is notarised and the new owner is entered in the local property register as the legal owner for the lease period.
How can you get Mortgage (Instalments) in Indonesia
The purchase of property from a developer in instalments starts with the reservation of a property by paying an Expression of Interest (EOI).
Once an expression of interest has been submitted, the purchaser must sign an agreement with the developer. Investors might be willing to provide:
- passport with at least six months of validity;
- сapital for the down payment of 30–50% of the property’s total cost.
Prior to finalising the agreement, investors may request documentation from the developer to verify the legitimacy of its operations. Typical documents provided by the developer include:
- вuilding permit (Persetujuan Bangunan Gedung);
- land title certificate;
- land tax receipt (PBB);
- Indonesian account and tax numbers.
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