blog.indahnesia.com - Discover Indonesia Online

    
You are currently in > Just a blog about Indonesia > Property for foreigners


Property for foreigners JAKARTA - Property analysts and developers share the same pessimistic projection that demand for all kinds of property will decline as the central bank continues to raise interest rates to cope with strong inflationary pressures and with a four-year low in consumer confidence.

This negative market sentiment, we think, is partly responsible for the revisiting of an old issue within the property industry -- the ban on foreign nationals owning property in Indonesia, as stipulated in Law No.5/1960 concerning land ownership. The law provides five kinds of rights over land and buildings, but foreign nationals are entitled to only three of them, namely the right to use, the right to cultivate and the right to build.

And even these rights can only be exercised for a certain period of time, ranging from 25 to 35 years, extendable for another 25-35 years under strict requirements, thereby putting investors at the mercy of the National Land Agency, which unfortunately is not included among the most efficient of government institutions in our country.

Property developers and analysts are hoping that easing restrictions on foreign nationals owning property would partly offset the slackening demand from domestic consumers. Moreover, they argue that the reasons for imposing such severe limitations are no longer sensible and logical in the current era of globalization. The drafting of the highly restrictive land law in 1960 -- only 15 years after the nation's independence from colonial domination that lasted hundreds of years -- is understandable to an extent as the politicians of the time were still highly xenophobic of anything related to foreign presence.

However, the core issue here is much broader than simply stoking foreign demand for property to offset the expected decline in demand from domestic consumers.

The ban on foreign nationals owning property in Indonesia has long been a major disincentive to investment from overseas, notably small and medium enterprises. Analysts have warned that Indonesia has failed to attract many foreign small and medium-scale investors -- who are precisely the kind of businesses the country needs due to the labor-intensive nature of their operations -- because of the overly restrictive regulations on them owning property and the consequent legal uncertainty caused by these excessively restrictive regulations.

The restrictions and the arduous bureaucratic and regulatory procedures to obtain the limited right of use, right to cultivate and right to build not only causes a high degree of uncertainty but also punitively high costs. In Bali, for example, quite a number of retirees from Europe and the United States who would like to spend the rest of their lives on the island of gods are forced to use an Indonesian nominees in an attempt to secure their property (homes), circumventing the ban but risking becoming embroiled in disputes or being cheated at some point.

Easing the restrictions on foreign nationals owning property would serve to eliminate some of the uncertainties of property ownership in this country. One should not dread of the possibility of foreign nationals becoming powerful landlords, because we are not talking about lifting the restrictions on rights of use or the right to cultivate and the right to build that may involve hundreds or thousands of hectares of land for mining or plantations.

What property developers and analysts have been recommending since the 1980s is the lifting of the ban on foreign nationals buying and owning residential property. What risk is there to either the economy or national security if foreign nationals are allowed to own apartments/condominiums or luxury houses in Bali and other resort areas?

On the contrary, allowing foreign nationals to own homes will not only strengthen the demand for residential property, but will also create legal certainty and will make overseas investors feel as though they are really welcome here. This is the point the government should take up in the bill on investment, which will soon be proposed to the House of Representatives to unify the 1967 foreign investment law and the 1968 domestic investment law.



Posted in General @ 30 November 2005 by Jeroen · 'Blog' RSS feed · permalink






There are no reactions on this blog entry yet. Be the first one to give a reaction here!


Log in to write a reaction

You are not logged in to the website. You have to be logged in to write a reaction on this blog entry.

· If you already have an account, please login.
· If you have lost your password, please retrieve it.
· If you don't have an account yet, you can create one.

    
 ABOUT THIS ENTRY
Add this blog entry to your email, your own blog, MySpace, Facebook, or whatsoever via AddThis:
Bookmark and Share

e-mail updates for this blog article

Login if you want to receive emails for reactions on this blog entry. You will receive an update as soon as a reaction on this blog entry is posted.

Your website for tickets in Indonesia!
Looking for e-tickets for flights in Indonesia? Here's your solution! Order your e-tickets at ticketindonesia.info.
 FOLLOW US ON TWITTER
 BLOG ARCHIVE
· 2015, 28 entries
· 2014, 591 entries
· 2013, 750 entries
· 2012, 1061 entries
· 2011, 792 entries
· 2010, 644 entries
· 2009, 916 entries
· 2008, 504 entries
· 2007, 725 entries
· 2006, 1014 entries
· 2005, 723 entries
· 2004, 558 entries
· 2003, 525 entries
· 2002, 375 entries
· 2001, 162 entries
 POPULAR TAGS
· gigolo
· jakarta
· blogger
Automatically generated every hour
 BLOG CATEGORIES
· General (1205 entries)
· Economy (643 entries)
· Politics (574 entries)
· Accidents (561 entries)
· Terrorism (541 entries)
· Earthquake (539 entries)
· Volcanoes (387 entries)
· Crime (357 entries)
· Corruption (349 entries)
· Flooding (278 entries)
· Elections (276 entries)
· Travel (268 entries)
· Bird Flu (254 entries)
· Religion (242 entries)
· Tourism (239 entries)
· Oddly enough ... (219 entries)
· Violence (198 entries)
· Drugs (196 entries)
· Health (192 entries)
· Aceh conflict (191 entries)
· Environment (185 entries)
· Weather (171 entries)
· Military (168 entries)
· Protests (157 entries)
· Culture (106 entries)
· Garuda Indonesia (91 entries)
· C. Sulawesi conflict (86 entries)
· Human rights (82 entries)
· Forest fires (78 entries)
· Sidoarjo mudflow (71 entries)
· Power supply (64 entries)
· Ramadan (63 entries)
· PT Freeport (55 entries)
· Picture guess (48 entries)
· Maluku conflict (47 entries)
· History (37 entries)
· Dengue Fever (37 entries)
· Infrastructure (36 entries)
· Polio (35 entries)
· Mexican flu (35 entries)
· Website (25 entries)
· Media (22 entries)
· Nuclear power (21 entries)
· Sports (20 entries)
· Sexy (16 entries)
· SARS (15 entries)
· Nightlife (10 entries)
· Others (5 entries)
· Lippo Cikarang (5 entries)
· Close smallest categories
 EXCHANGE RATES
EUR-IDR: 16,590 · 16,620  The Rupiah rate declined since yesterday
@ 17 May 2018 18:12 CET
JPY-IDR: 126.83 · 126.95  The Rupiah rate improved since yesterday
@ 17 May 2018 21:58 CET
MYR-IDR: 3,545 · 3,549  The Rupiah rate declined since yesterday
@ 15 May 2018 08:42 CET
SGD-IDR: 10,479 · 10,501  The Rupiah rate declined since yesterday
@ 07 May 2018 07:48 CET
THB-IDR: 439.14 · 439.41  The Rupiah rate declined since yesterday
@ 16 May 2018 09:18 CET
USD-IDR: 14,097 · 14,157  The Rupiah rate declined since yesterday
@ 17 May 2018 00:46 CET
Go to 'exchange rates' 
 MOST RECENT REACTIONS
·  At 20 September 2018 06:54 erik12 reacted on Fuel prices lowered, again
·  At 19 October 2015 17:17 imambudianto5 reacted on Bank Indonesia maintains benchmark interest rate at 7.75%
·  At 04 March 2015 19:18 merdekaSah reacted on Alleged terrorists shot dead three villagers in Poso
·  At 04 March 2015 13:11 Yogya-Bali reacted on Alleged terrorists shot dead three villagers in Poso
·  At 26 February 2015 13:02 Irena reacted on Sexy, a young woman with candy
·  At 08 May 2014 09:51 jstar reacted on No alcohol should be sold in warung
·  At 01 May 2014 10:07 jstar reacted on Indonesia to be among the top 10 peacekeeping contributors
·  At 27 March 2014 05:50 harlys reacted on PPP leader voices concern over Islamic parties' future
·  At 10 March 2014 06:11 Yogya-Bali reacted on Sriwijaya Air leaves behind 200 passengers at airport
·  At 09 March 2014 00:11 Yerun reacted on Sriwijaya Air leaves behind 200 passengers at airport
·  At 08 March 2014 20:33 nicknick reacted on Sriwijaya Air leaves behind 200 passengers at airport
·  At 18 February 2014 04:17 Yerun reacted on Ash from Mount Kelud eruption spreads over all of Java
·  At 16 February 2014 05:41 Amed East Bali reacted on Ash from Mount Kelud eruption spreads over all of Java
·  At 14 February 2014 22:27 Anne Mieke reacted on Asylum seekers in Medan wish to be sent to Australia
·  At 14 February 2014 22:22 beritaislam reacted on Asylum seekers in Medan wish to be sent to Australia
·  At 16 January 2014 15:37 Anne Mieke reacted on Landslides cut off Tomohon-Manado road
·  At 16 January 2014 15:21 Yerun reacted on Landslides cut off Tomohon-Manado road
·  At 16 January 2014 15:05 Anne Mieke reacted on Landslides cut off Tomohon-Manado road
·  At 16 January 2014 14:48 Yerun reacted on Landslides cut off Tomohon-Manado road
·  At 16 January 2014 14:41 Yerun reacted on Landslides cut off Tomohon-Manado road
Go to 'forum topics' 

Created by indahnesia.com · feedback & contact · © 2000-2019
Other websites by indahnesia.com: ticketindonesia.info · kamus-online.com · indonesiepagina.nl · suvono.nl

Valid HTML 4.01 Transitional 120,738,761 pageviews Discover Indonesia Online at indahnesia.com