Key Takeaways
- The best leasehold length in Bali is around 25–30 years, offering a balance between flexibility, ROI, and legal simplicity.
- Longer Leases = Better Value. Longer leases (20+ years) attract more buyers, provide stable rental income, and give investors better control and resale potential.
- Here's how leasehold works: Foreigners lease land and gaining rights to use (Hak Sewa) and build on it for a set period, with options to extend or sublease.
- Remember to plan smart. Work with experts to secure the right term and handle legal requirements properly.
When buying Bali leasehold villas, one of the most important factors to check is how many years are left on the lease.
Many investors overlook the lease duration before signing the contract. A short lease (under 20 years) rarely gives a good ROI, while 99-year leases can be complex and often need to be passed down later, especially for individual tenants.
The length of the lease can also affect the property’s value, your ability to get a mortgage, and how easy it will be to sell in the future. By understanding this, you can avoid costly surprises and make a smarter buying decision.
In this article, we break down the ideal lease length based on our clients’ real investment experiences in Bali. Let’s dive in.
How Long Should a Bali Property Lease Be?
In Bali, foreigners can typically lease property (villa, land, apartment, house) for 25 to 30 years, with the option to renew. Renewal agreements often allow extensions of the lease term, sometimes adding up to a total of 80 years.
Alternatively, investors can also negotiate longer lease terms upfront—up to 99 years. While this is possible, it’s less common and requires careful negotiation and proper legal documentation.
Here’s a quick refresher on how leasehold works: This type of ownership gives the tenant legal rights from the landowner to use, build on, and benefit from a property for a fixed period of time.
The lessee pays the lessor an agreed amount in exchange for the right to develop and use the land. During the lease period, the lessee can also transfer or sublease those rights to another party, as long as it is done before the lease expires.
Read More: What Happens When Your Bali Villa Lease Expires?
How Many Years Should Be Left on a Leasehold Property?
Based on our experience handling clients’ leasehold properties, leases with around 20 to 25 years remaining often hit the sweet spot.
This duration gives buyers peace of mind; enough time to enjoy the property without feeling rushed to extend the lease immediately.
That said, it doesn’t mean you can’t sell a property with a shorter lease. You just need to adjust your expectations and be ready to negotiate. Many buyers are still interested, especially if they love the villa and the price reflects the remaining lease term.
Benefits of Long Term Lease in Bali
Having a longer lease can give you more control, flexibility, and peace of mind. Here are some key benefits of holding a long leasehold villa Bali:
- Faster Return on Investment: On average, most investors recoup their initial costs within 7 to 8 years.
- Ongoing Rental Income: Once the payback period is over, most of what you earn from the property becomes profit.
- More Flexibility: If you’re not in a rush to sell, you can keep renting the villa and enjoy steady income.
- Better Position for Future Sale: A longer lease makes your villa more attractive to buyers, especially if the lease has 20+ years remaining.
- Option to Extend: You can extend the lease early to add value and give your property a fresh start—especially useful if your paperwork is already clean and legal.
- Less Pressure, More Control: Whether you sell now or later, a long lease gives you time to plan and negotiate on your terms.
Conclusion
If your goal is to earn higher profits, we usually recommend choosing a lease term of around 25–30 years. This range is often considered the sweet spot for balancing returns and long-term value.
Make sure all required documents are properly prepared so your investment stays legal and on track.
If you’d like guidance from the very beginning, we’re here to help. Our senior property advisors will walk you through every step of the leasing process, so you can move forward with confidence and peace of mind.
Click the button below to get started.
FAQ
Yes. Selling a leasehold title may happen in two different forms:
- As a sublease that you grant to your buyer, or
- By cancelling your lease and replacing it with a new lease directly between the owner of the freehold title and your leasehold buyer.
Yes, you can. Renting out a leasehold villa on platforms like Airbnb is common and can be highly profitable, thanks to Bali’s strong tourism demand.
Leasehold properties are subject to a 10% tax on the total transaction value. This is usually paid by the seller, but buyers should confirm it’s handled correctly during negotiations. Learn more: Understanding Bali Property Taxes for Foreign Buyers
The main downsides include rising ground rent, service fees, limited ownership time, and added costs for permits or approvals. Since leaseholds decrease in value over time, it’s important to plan carefully and seek professional advice.
