Hak Pakai in Indonesia is the country’s “Right to Use” land title, and it is the only registered land right that an individual foreigner can hold in their own name. It is governed by the Basic Agrarian Law of 1960 and Government Regulation No. 18 of 2021, and it lets the holder use and occupy land for residential or commercial purposes without conferring outright ownership. On state land the total possible duration reaches 80 years across an initial grant, an extension, and a renewal. The title can be sold, inherited, and in many cases pledged as loan collateral, but a foreign holder’s right depends on keeping a valid Indonesian residence permit for the entire time they own the property.
Where Hak Pakai Fits Among Indonesian Land Titles
Indonesia recognizes several distinct land titles, and only one of them is open to individual foreigners. Hak Milik is full freehold ownership, the strongest title available, but only Indonesian citizens can hold it. Hak Guna Bangunan (HGB) grants the right to build on land for up to 30 years with extensions and is available to Indonesian companies, including foreign-invested PT PMA entities, but not to foreigners in a personal capacity. Hak Pakai has the broadest eligibility: Indonesian citizens, domestic and foreign legal entities, religious organizations, and individual foreigners with valid residence permits can all hold it.
For apartment buyers, Government Regulation No. 18 of 2021 expanded foreign access to include strata title ownership in designated economic zones, free trade zones, and industrial zones, in addition to the long-standing route of holding an apartment unit under a Hak Pakai strata certificate.
Who Can Hold Hak Pakai
Government Regulation No. 18 of 2021 lists five categories of holders eligible for a Hak Pakai title with a defined time period: Indonesian citizens; Indonesian legal entities, including foreign-invested PT PMA companies; foreign legal entities with a representative office in Indonesia; religious and social organizations; and individual foreigners.1Peraturan.go.id. Government Regulation Number 18 of 2021 on Right to Manage, Land Right, Apartment Unit, and Land Registration
For a foreign individual, the residence permit is the gatekeeper. A limited stay permit (KITAS), a permanent stay permit (KITAP), and the Second Home Visa all satisfy the requirement. Indonesian citizenship and permanent residency are not required, but the permit must stay valid for the entire period of ownership. Losing it starts a one-year forced divestment clock, addressed below.
Minimum Purchase Prices
Foreigners buying residential property under Hak Pakai must meet minimum price floors that vary by province and property type. In Jakarta, the floor for a standalone house has been set as high as IDR 10 billion (roughly USD 650,000). In less urbanized provinces, the minimum can fall to around IDR 1 billion for houses and IDR 750 million for apartment units. Implementing regulations have adjusted these thresholds over time, so confirm the current figure for your target province with BPN or a licensed notary before committing funds.
How Long Hak Pakai Lasts
Duration depends on whether the underlying land is state-controlled or privately owned. The gap between the two is large enough to shape which properties are worth pursuing.
On State Land
Hak Pakai on state land or land under a Right to Manage follows a three-stage timeline: an initial grant of up to 30 years, an extension of up to 20 years, and a renewal of up to 30 years, for a theoretical maximum of 80 years.1Peraturan.go.id. Government Regulation Number 18 of 2021 on Right to Manage, Land Right, Apartment Unit, and Land Registration Each stage requires that the land still be used for its approved purpose and that the holder still qualify. These are ceilings, not guarantees; the state can grant shorter periods, and each stage involves a fresh application.
On Private Hak Milik Land
When Hak Pakai is granted over privately owned Hak Milik land, the maximum initial term is 30 years, and it can be renewed only through a new notarial deed between the landowner and the holder. There is no automatic extension stage. Continued rights depend entirely on negotiating a fresh agreement with the landowner when the term ends, which makes state-land Hak Pakai more secure for long-term planning.
Extension and Renewal Deadlines
The regulation distinguishes between an extension and a renewal, and the deadlines are different. An extension application must be filed before the current term expires, while the land is still being used for its approved purpose. A renewal application can be submitted up to two years after the right expires.1Peraturan.go.id. Government Regulation Number 18 of 2021 on Right to Manage, Land Right, Apartment Unit, and Land Registration Missing the extension window means the right lapses and you must apply for a renewal or a new grant. Filing well in advance avoids the risk.
Taxes and Fees
Costs hit at three points: acquisition, annually during ownership, and again on resale.
At Purchase
The buyer pays BPHTB, a land and building acquisition duty, at up to 5% of the property’s assessed value minus a non-taxable threshold that varies by region (minimum IDR 80 million). The seller pays income tax (PPh) at 2.5% of the gross transfer value. Both must be settled before BPN will register the transfer. Notary fees for the sale and purchase deed (AJB) typically add another 1% to 2% of the transaction value.
Every Year
Every Hak Pakai holder owes annual land and building tax (PBB). The maximum rate is 0.5%, applied to a percentage of the property’s assessed value (NJOP). Local governments set the exact rate and the assessment percentage, so the effective burden varies by municipality. A non-taxable NJOP deduction of at least IDR 10 million applies, meaning very low-value properties may owe little or nothing.
When You Sell
On resale, the same 2.5% income tax falls on you as the seller, and the new buyer picks up the BPHTB acquisition duty. Registration fees at BPN are calculated based on the number of parcels and the total land area rather than as a flat charge.2Kementerian Agraria dan Tata Ruang/Badan Pertanahan Nasional. Kantor Pertanahan Kota Administrasi Jakarta Utara – E-Form
Documents and Application Steps
Applications go to the local land office (Kantor Pertanahan) under BPN. The core documents for an individual applicant are a passport with a valid residence permit (KITAS, KITAP, or equivalent) for foreigners or a KTP and family card for Indonesian residents; proof of land acquisition such as a deed of sale or inheritance document; receipts for the applicable PPh and BPHTB payments; a signed statement of physical possession; and land survey data.2Kementerian Agraria dan Tata Ruang/Badan Pertanahan Nasional. Kantor Pertanahan Kota Administrasi Jakarta Utara – E-Form If no prior survey exists, BPN arranges one during the application. Legal entities add incorporation documents, proof of Indonesian registration, and authorization letters; foreign entities also show evidence of their representative office.
Once filed, the process moves through document review and fee assessment, a BPN field survey to verify boundaries and possession, an eligibility and land-use review, and finally recording in the land book and issuance of the certificate. BPN’s published service standard for non-agricultural parcels under 2,000 square meters is 38 working days from a complete submission.2Kementerian Agraria dan Tata Ruang/Badan Pertanahan Nasional. Kantor Pertanahan Kota Administrasi Jakarta Utara – E-Form Boundary disputes, incomplete documents, or heavy office workloads can push the actual timeline out further.
Selling, Transferring, and Using as Collateral
A Hak Pakai title can be sold or transferred to another eligible holder. A licensed land deed official (PPAT) drafts and executes the sale and purchase deed (AJB), both parties sign, transfer taxes are paid, and the PPAT submits the transfer to BPN for registration. The change is not legally complete until BPN issues a new certificate in the buyer’s name, typically four to twelve weeks after submission. The buyer must independently qualify: an Indonesian citizen can convert the property to Hak Milik, while a foreign buyer must hold a valid residence permit at the time of transfer.
Hak Pakai with a defined time period can be used as collateral for bank loans. The indefinite form of Hak Pakai granted to government bodies and certain institutions, known as “Hak Pakai during use,” cannot be encumbered as debt security.1Peraturan.go.id. Government Regulation Number 18 of 2021 on Right to Manage, Land Right, Apartment Unit, and Land Registration
Losing the Right
Expired Residence Permit
A foreigner who lets a KITAS or KITAP expire without renewal has one year from the loss of residency status to sell or transfer the property to an eligible party: an Indonesian citizen, another foreigner with a valid residence permit, or a PT PMA company. If the year passes without a transfer, the government has legal authority to auction the property and return the proceeds to the former owner minus administrative costs. Documented auctions of foreign-held Hak Pakai are rare, but the mechanism exists in law. Anyone planning an extended absence should renew the permit before leaving or begin a transfer early.
Inheritance by a Foreign Heir
A foreign citizen can inherit Indonesian property, but the deadline is strict. Within one year of the inheritance, the heir must either convert the title to Hak Pakai in their own name (which requires a valid residence permit) or transfer it to an eligible party such as an Indonesian citizen. If neither happens within 12 months, the land reverts to the state by operation of law under Article 21 of the Basic Agrarian Law.3Peraturan.go.id. Indonesia Code – Basic Agrarian Law of 1960 The deadline still runs during probate or family disputes, so heirs should start the process immediately.
Revocation Before the Term Ends
The state can cancel a Hak Pakai title before its term expires on several grounds: failure to comply with the obligations or prohibitions attached to the right, breach of the conditions in the original grant, administrative defects discovered after issuance, or a final court decision ordering cancellation.1Peraturan.go.id. Government Regulation Number 18 of 2021 on Right to Manage, Land Right, Apartment Unit, and Land Registration The most common practical trigger is using the land for a purpose that differs from the approved use stated in the certificate. Running a commercial business on a parcel granted for residential use can, on its own, put the title at risk.