Due Diligence Checklist for Buying Property in Bali as a Foreigner

Last updated: February 2026 · By Bali Property Rules Research Desk

Contents

1. Why Is Due Diligence Critical When Buying Property in Bali?
2. How Do You Verify a Land Certificate (Sertifikat) Is Authentic?
3. What Should You Check at the Local Land Office (BPN)?
4. How Do You Confirm the Seller Actually Owns the Property?
5. What Zoning and Land Use Restrictions Should You Investigate?
6. How Do You Check for Liens, Mortgages, or Disputes?
7. What Environmental and Physical Checks Should You Conduct?
8. How Do You Verify Building Permits and IMB/PBG Status?
9. What Role Should a PPAT and Independent Lawyer Play?
10. The Complete Due Diligence Checklist
11. Frequently Asked Questions
12. Sources and References

Why Is Due Diligence Critical When Buying Property in Bali?

Due diligence is the only reliable protection a foreign buyer has in the Indonesian property market. Indonesia’s land registration system is not fully centralized, certificates can be forged or duplicated, and sellers may not disclose encumbrances, disputes, or zoning restrictions. Without independent verification, you risk paying for property you cannot legally use — or that someone else already claims to own.

Foreign buyers face particular risks because they cannot hold freehold title (Hak Milik) under UUPA No. 5/1960. This means transactions often involve converting title types, using nominee structures (which are illegal), or establishing a PT PMA company. Each of these adds layers where errors or fraud can occur.

Common problems that due diligence uncovers include:

• Forged or duplicate certificates — the same land registered to multiple parties
• Undisclosed liens (Hak Tanggungan) — the property is collateral for a bank loan
• Boundary disputes — physical boundaries don’t match the certificate’s survey map (Surat Ukur)
• Zoning violations — the land is zoned agricultural or green zone, not residential or commercial
• Missing spousal consent — making the entire transaction voidable under UU 1/1974
• Unpaid property taxes (PBB) — creating arrears you inherit

Due diligence is not optional. It is the foundation of every safe property transaction in Bali.

How Do You Verify a Land Certificate (Sertifikat) Is Authentic?

Start by identifying the certificate type and physically inspecting the original document. Indonesia uses several types of land certificates, each granting different rights. A Sertifikat Hak Milik (SHM) is freehold and the strongest title — but foreigners cannot hold it. A Sertifikat Hak Guna Bangunan (SHGB) grants building rights for a set period. A Sertifikat Hak Pakai (SHP) is the title foreigners can legally hold under PP 103/2015.

Here is what to check on the physical certificate:

Element	What to Look For	Red Flag
Certificate type	SHM, SHGB, or SHP clearly stated	Girik, Letter C, or Petok D — these are not registered titles
Watermark and seal	BPN watermark, official embossed seal, and authorized signatures	Missing watermark, blurry print, inconsistent formatting
Serial number	Unique certificate number matching BPN records	Number does not appear in BPN system
Surat Ukur (survey map)	Attached survey map with coordinates and measurements	Missing, detached, or measurements that don’t match the land
Owner name	Matches the seller’s KTP (identity card) exactly	Name discrepancy between certificate and KTP
Expiry date (SHGB/SHP)	Rights still valid and not expired	Expired rights — renewal is required before transfer
Endorsements on reverse	Record of all previous transfers and encumbrances	Whited-out entries, missing pages, or gaps in transfer history

Unregistered land titles: Some land in Bali, particularly in rural areas, is still held under adat (customary) rights documented only as Girik, Letter C, or Petok D records at the village (kelurahan) level. These are not registered certificates. Purchasing unregistered land requires a separate process of first registration at BPN, which adds time, cost, and risk. If the seller presents anything other than an SHM, SHGB, or SHP issued by BPN, proceed with extreme caution and independent legal advice.

Never accept photocopies as proof. Always examine the original certificate and compare it against BPN records before proceeding.

What Should You Check at the Local Land Office (BPN)?

The BPN (Badan Pertanahan Nasional) is where you confirm that a certificate is genuine, currently valid, and free from encumbrances. Request a formal certificate check — known as a “pengecekan sertifikat” — through an authorized PPAT. This is the most important single step in your due diligence, and no transaction should proceed without it.

The BPN verification will confirm:

• Authenticity — the certificate serial number exists in the BPN registry and has not been flagged as forged or duplicated
• Current registered owner — the name on file at BPN matches the seller’s identity
• Encumbrances — any Hak Tanggungan (mortgage/lien), court orders (sita jaminan), or blocks on transfer
• Land area and boundaries — the Surat Ukur measurements on file match those on the certificate
• Title status — whether the rights are still valid (for SHGB and SHP, which have expiry dates)

How the BPN check works:

1. Your PPAT submits the original certificate to the local BPN office that has jurisdiction over the property’s location.
2. BPN compares the certificate against their records (the Buku Tanah — the land register).
3. BPN returns the certificate with a stamp indicating the result: clean, encumbered, or flagged.
4. Processing time varies by office — practitioners report it typically takes one to two weeks, though it can take longer.

The BPN check should be completed before you sign a binding agreement or pay any deposit beyond a small, refundable reservation fee. If a seller refuses to allow a BPN check or pressures you to skip it, treat this as a serious red flag.

How Do You Confirm the Seller Actually Owns the Property?

Certificate verification alone is not enough — you must also confirm that the person selling you the property is the legitimate, authorized owner. This means matching the certificate holder’s identity against their KTP (Kartu Tanda Penduduk), verifying marital status, and confirming there are no power-of-attorney arrangements that might complicate the sale.

Identity verification steps:

• Compare the seller’s KTP to the name on the land certificate. The name, NIK (national identity number), and address should match exactly. Even minor discrepancies — a different spelling, a maiden name versus married name — require clarification and possibly a court order to resolve.
• If the seller is using a representative (kuasa), verify the power of attorney (Surat Kuasa) is notarized, specific to this transaction, and still valid.
• For corporate sellers (PT), verify the company’s legal standing through its AHU (legal entity administration) registration and confirm the person signing has authority under the company’s Articles of Association.

Spousal consent — a critical requirement:

Under UU 1/1974 (Marriage Law) Article 35, property acquired during marriage is joint marital property (harta bersama). Selling joint marital property requires written consent from both spouses. If the seller is married and their spouse does not consent in writing, the transaction can be challenged and voided in court — even years after completion.

To verify marital status:

• Check the seller’s KTP for marital status (but note this is not always up to date)
• Request a copy of the marriage certificate (Akta Nikah) or a certificate of single status (Surat Keterangan Belum Menikah) from the kelurahan
• If married, obtain signed spousal consent (Persetujuan Suami/Istri) as part of the transaction documents

This is one of the most frequently overlooked requirements — and one of the most common grounds for legal challenges to property transactions in Indonesia. For more on how marital status affects property rights, see our guide on inheritance and Bali property.

What Zoning and Land Use Restrictions Should You Investigate?

Before purchasing any property in Bali, you must verify that the land is zoned for your intended use. Indonesia’s spatial planning system (Rencana Tata Ruang Wilayah, or RTRW) designates land for specific purposes: residential, commercial, agricultural, tourism, green zone, or conservation. Building on land zoned for a different use can result in permit denials, demolition orders, or inability to obtain business licenses.

Zoning checks involve:

• RTRW verification — obtain the current spatial plan from the local government (Dinas Tata Ruang or DPMPTSP). Confirm the property falls within a zone that permits your intended use.
• RDTR check — the Rencana Detail Tata Ruang (Detailed Spatial Plan) provides more granular zoning at the sub-district level. Some areas have published RDTR maps, while others rely on the broader RTRW.
• Green zone (Kawasan Hijau) — land in designated green zones has severe building restrictions. In Bali, rice paddy areas (sawah) and sacred spaces around temples are commonly protected.
• Coastal setback (sempadan pantai) — beachfront properties must observe setback distances from the high-water mark. Building permits will not be issued for structures within this zone.
• Agricultural land conversion — converting agricultural land to residential or commercial use requires a formal land-use change permit (izin perubahan penggunaan tanah). This process is complex, not always approved, and varies by regency.

Bali-specific zoning considerations:

Bali has additional spatial planning rules under provincial regulations designed to protect its cultural and environmental heritage. These include restrictions around temples (pura), water sources, ravines (jurang), and designated rice terrace landscapes. A property that appears to be in a prime location may have significant building restrictions that the seller does not disclose.

Zoning information is increasingly available through Indonesia’s OSS (Online Single Submission) system following PP 28/2025, but for Bali-specific regulations, direct verification with the local spatial planning office remains essential.

How Do You Check for Liens, Mortgages, or Disputes?

A property that looks clean on paper may carry hidden financial or legal burdens. Hak Tanggungan (security rights) registered against the certificate mean the property is collateral for a debt — and the lender has priority over you. Court seizure orders (sita jaminan) block any transfer until resolved. Dispute checks at the village level can reveal boundary conflicts or inheritance claims that never reached formal registration.

Where to check for encumbrances:

Type of Check	Where to Check	What You’re Looking For
Hak Tanggungan (mortgage lien)	BPN — recorded on certificate and in Buku Tanah	Any registered lien. Must be released (roya) before transfer.
Court seizure (sita jaminan)	BPN records and local court (Pengadilan Negeri)	Any judicial block on the property
Tax liens / arrears	Local tax office (Kantor Pajak) and PBB receipts	Unpaid PBB (property tax) for prior years
Boundary disputes	Kelurahan / Desa (village office) and neighbors	Ongoing or historical disputes about land boundaries
Inheritance claims	Kelurahan and family members	Other heirs who may contest the sale
Adat (customary) claims	Banjar (customary community) and village elders	Land subject to communal customary rights

PBB tax receipts: Request copies of PBB (Pajak Bumi dan Bangunan — land and building tax) receipts for at least the past five years. These serve two purposes: they confirm the registered taxpayer matches the seller, and they reveal any tax arrears that you would inherit as the new owner. PBB receipts also provide an independent reference for the property’s location, area, and assessed value.

Village-level checks (kelurahan/desa): Indonesian land disputes often exist at the community level without ever being formally registered at BPN. Visit the kelurahan or desa office and ask the village head (lurah or kepala desa) whether there are any known disputes, competing claims, or community objections to the sale. While this step is informal, it can surface problems that no official database will reveal.

Banjar consultation: In Bali specifically, the banjar (customary community organization) plays a significant role in land matters. Some land in Bali is communal banjar land that cannot be individually sold. Even for privately owned land, the banjar may have established rights of way, temple easements, or other customary obligations. Consulting the banjar head (kelian banjar) is a prudent step.

What Environmental and Physical Checks Should You Conduct?

Legal title checks must be supplemented with physical inspection of the property itself. Land in Bali can be affected by flooding, erosion, unstable soil, water access issues, and environmental contamination. A site visit — ideally during the rainy season — reveals conditions that no certificate or office record will show. Physical boundaries must match what the certificate describes.

Physical inspection checklist:

• Boundary verification — walk the property boundaries with the Surat Ukur (survey map) from the certificate. Look for boundary markers (patok) placed by BPN. If markers are missing or boundaries are unclear, commission an independent survey by a licensed surveyor before proceeding.
• Flood risk — visit during or immediately after heavy rain. Check for standing water, drainage patterns, and proximity to rivers or streams that flood. Ask neighbors about historical flooding.
• Soil stability — hillside properties in Bali are prone to landslides, particularly in the rainy season. Look for signs of soil movement: cracks in existing structures, leaning trees, retaining wall failures.
• Water access — confirm the property has legal access to water (PDAM municipal water connection or a registered well). Water access is not guaranteed and can be a significant issue in some areas of Bali.
• Road access — verify the property has legal road access. Some Bali properties are landlocked, with access only through neighboring land via informal arrangements that may not survive a change of ownership.
• Electricity — confirm PLN (state electricity company) connection availability and current capacity. Upgrading electrical capacity in some areas involves wait times.
• Environmental contamination — if the land was previously used for agriculture, industrial purposes, or fuel storage, consider whether soil contamination is a concern.

For leasehold properties: physical inspection is equally important. Additionally, verify the condition of any existing structures against the lease terms. Check whether the lease requires you to return the property in a specific condition, and assess the cost of any required maintenance or restoration.

How Do You Verify Building Permits and IMB/PBG Status?

Every building in Indonesia requires a permit. The older system used an IMB (Izin Mendirikan Bangunan). Following the Omnibus Law (UU 6/2023 on Cipta Kerja) and PP 28/2025, the IMB is being replaced by the PBG (Persetujuan Bangunan Gedung) through the OSS system. If you are buying an existing building, verify its permit status. If you plan to build, understand the current permit requirements before committing to purchase.

For existing buildings:

• Request a copy of the IMB or PBG. Verify the permit matches the actual structure — the permitted floor area, number of stories, and building use must correspond to what is built.
• Check for any permit amendments (perubahan IMB) that should have been obtained for modifications or expansions.
• Confirm the IMB/PBG was issued for the correct plot — match the permit’s location details against the land certificate.
• Verify the SLF (Sertifikat Laik Fungsi — building worthiness certificate) if applicable. This certifies the building meets safety and structural requirements.

For new construction:

• Confirm the land’s zoning permits the type of building you plan to construct.
• Verify that a PBG can be issued for your intended use — residential, commercial, or tourism (Pondok Wisata).
• Check local building regulations for height restrictions, building coverage ratio (KDB), floor area ratio (KLB), and setback requirements.
• Consider whether the area has specific architectural requirements. Bali has provincial regulations requiring buildings to incorporate Balinese architectural elements and observe height limits.

A building without a valid permit is vulnerable to enforcement action, including fines and demolition orders. Unpermitted structures also cannot be insured, may affect the property’s resale value, and can complicate future permit applications on the same plot. Never assume that because a building “has been there for years” it has proper permits.

What Role Should a PPAT and Independent Lawyer Play?

A PPAT (Pejabat Pembuat Akta Tanah — Land Deed Official) is the only person authorized to execute an AJB (Akta Jual Beli — deed of sale and purchase) that BPN will accept for title transfer. Using a PPAT is legally required, not optional. However, a PPAT alone is not enough — you also need an independent lawyer (pengacara) who represents your interests exclusively, because the PPAT serves both buyer and seller.

PPAT responsibilities:

• Conducting the BPN certificate check (pengecekan sertifikat)
• Verifying seller identity and authority to sell
• Preparing and executing the AJB
• Submitting the AJB and supporting documents to BPN for title transfer (balik nama)
• Ensuring all required taxes (PPh and BPHTB) are paid before executing the AJB

What the PPAT does NOT do:

• Represent your interests — the PPAT is a neutral public official
• Negotiate terms or review the commercial agreement
• Conduct comprehensive due diligence beyond the BPN check
• Advise on structuring (PT PMA, Hak Pakai conversion, lease terms)
• Verify zoning, building permits, or environmental issues

Independent lawyer responsibilities:

• Reviewing and negotiating the PPJB (preliminary sale agreement) before you commit
• Conducting or overseeing comprehensive due diligence across all areas covered in this guide
• Advising on transaction structure — whether to use Hak Pakai (under Permen ATR/BPN 29/2016), leasehold (under PP 44/1994), or PT PMA
• Ensuring all contracts protect your interests and comply with Indonesian law
• Coordinating with the PPAT and the seller’s representatives

How to choose professionals:

• Use a PPAT registered in the jurisdiction where the property is located — PPATs have geographic authority limits
• Choose a lawyer with specific experience in Indonesian property transactions for foreigners — general corporate lawyers may lack land law expertise
• Verify the PPAT’s registration with the local BPN office
• Avoid using professionals recommended exclusively by the seller or the seller’s agent — their loyalty may not be with you

The cost of engaging an independent lawyer is small compared to the value of the transaction and the risks of proceeding without one. Practitioners report that legal fees for a full due diligence review and transaction support vary based on complexity, but this investment has prevented many foreign buyers from costly mistakes.

The Complete Due Diligence Checklist

Use this summary table as your working checklist. Complete every item before signing a binding agreement or transferring funds beyond a refundable reservation deposit.

#	Step	What to Check	Where to Check	Red Flag If…	Priority
1	Certificate type	SHM, SHGB, SHP, or lease — NOT Girik/Letter C	Physical certificate	Seller presents unregistered title	Critical
2	Certificate authenticity	Watermark, seal, serial number, survey map	Physical certificate	Missing watermark, blurry print, detached pages	Critical
3	BPN verification	Certificate matches Buku Tanah records	Local BPN office (via PPAT)	Certificate number not found or flagged	Critical
4	Owner identity match	Seller’s KTP matches certificate holder	KTP vs. certificate	Name, NIK, or address discrepancy	Critical
5	Marital status & consent	Spousal consent for marital property	KTP, marriage certificate, kelurahan	Married seller without spouse’s written consent	Critical
6	Power of attorney	If representative sells, notarized kuasa	Notarized Surat Kuasa document	Unnotarized, expired, or general (not specific) authority	High
7	Liens and mortgages	No Hak Tanggungan or must be released (roya)	BPN records (Buku Tanah)	Active lien without roya commitment	Critical
8	Court orders	No sita jaminan or other judicial blocks	BPN records and Pengadilan Negeri	Any court block on transfer	Critical
9	PBB tax receipts	All taxes paid, no arrears, taxpayer matches seller	PBB receipts (5+ years) and Kantor Pajak	Unpaid taxes, taxpayer name mismatch	High
10	Village dispute check	No known disputes, competing claims, or objections	Kelurahan/Desa and Banjar	Village head aware of unresolved dispute	High
11	Zoning verification	Land zoned for intended use	RTRW/RDTR at Dinas Tata Ruang / OSS	Zoned agricultural, green zone, or conservation	Critical
12	Coastal/environmental restrictions	Not within protected setback zones	Local spatial planning office	Within sempadan pantai or protected area	High
13	Physical boundary verification	Boundaries match Surat Ukur / survey map	On-site survey with certificate	Boundaries don’t match, markers missing	High
14	Flood and soil assessment	No flooding history, stable soil	Site visit (rainy season if possible), neighbors	Standing water, slope cracks, landslide history	Medium
15	Access and utilities	Legal road access, water (PDAM/well), PLN electricity	Site visit, utility companies	Landlocked, no water rights, no power connection	High
16	Building permit (IMB/PBG)	Valid permit matching actual structure	IMB/PBG document, local DPMPTSP	No permit, expired permit, or structure exceeds permit	High
17	SLF (building worthiness)	Valid certificate for existing buildings	SLF document	No SLF for a building that requires one	Medium
18	Title expiry (SHGB/SHP)	Rights not expired or near expiry	Certificate, BPN records	Expired or expiring within 1 year without renewal filed	High
19	PPAT engagement	PPAT registered in property’s jurisdiction	Local BPN office	PPAT not registered in correct area	Critical
20	Independent legal review	Own lawyer reviews all documents and contracts	Your independent lawyer	Seller insists you use only their lawyer/notary	Critical

Leasehold-specific additional checks:

#	Step	What to Check	Red Flag If…
L1	Lease agreement terms	Duration, renewal options, termination clauses, rent increases	No clear renewal terms, unilateral termination rights for lessor
L2	Lessor’s ownership	Lessor holds valid SHM/SHGB and is authorized to lease	Lessor doesn’t own the land or lacks authority
L3	Notarization	Lease agreement is notarized (akta notaris)	Only a private (bawah tangan) agreement — weaker legal standing
L4	Existing sub-leases	No conflicting sub-leases or occupancy rights	Third parties claiming rights to occupy

Frequently Asked Questions

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