Looking to buy villa in Indonesia

[CJ]

Sorry .....

[chrystia]

I do have trusted connections which is why I'm considering it a viable option. Thanks for the replies all, this is great - gives me something to think about. Keep 'em coming!

[POSSUM THE CAT]

chrystia Have a look at there property law. I think you have to be an Indonesian to own property

[chrystia]

That's correct, a foreigner can't freehold property but can get a Right to Use or Right to Build.

Also there's this:
"Properties can be owned by companies, like a PT or a PMA. A PT is an Indonesian "Limited", a PMA is a foreign investment company which can be owned 100% by foreigners. The PMA property license has to be renewed every 20 or 30 years. Setting up a PT costs about 7 to 10 million rp, a PMA around 35 million rp."

[Halebop]

An acquaintance invested a couple of times in Bali through an expat Kiwi connection.

First a single villa in a modest sized tourism venture. Returns were sound (both income and capital gain) pre GFC. Income was very poor during the GFC and market had zero liquidity so value was more or less unknown, not sure what it is like now (I think history will say we are still in the GFC at present...).

2nd project was more substantial in scale - a large share of an exclusive complex pitched to very upmarket clients (essentially a large house that could be easily reconfigured into 4 villas depending on bookings/client needs). Cost over-runs were severe, they felt as though the Kiwi promoter was rorting the process and over-stating costs. No control of process or understanding of local cost inputs or systems. It became expensive and time consuming to travel over and try to sort problems in person. Stage 1 completed during GFC - income was terrible.

While I'm sure there are foreign property markets that will outperform New Zealand, there is a big "uncertainty" trade off across a range of imponderables (and I'm not convinced Indonesia would be the market I chose for that risk). I'm also reminded of a poker maxim - "when you're looking around the table and you don't know who the patsy is - you're the patsy".

[chrystia]

Cool this is exactly the kind of stuff I'm looking for... the good, the bad and the ugly. I know it can be done, but is setting something up like this viable, or is it more trouble than it's worth?

[fungus pudding]

Cool this is exactly the kind of stuff I'm looking for... the good, the bad and the ugly. I know it can be done, but is setting something up like this viable, or is it more trouble than it's worth?

Yes, it certainly is.

[Stranger_Danger]

From todays AFR

Australian investors in Indonesia have been warned that the country is becoming increasingly hostile to outside interests after a series of high-profile ownership disputes were capped this week by the dramatic dissolution of the nation’s independent oil and gas regulator.

The Indonesian Constitutional Court’s decision to disband regulator BPMigas, which has raised doubt over the validity of oil and gas contracts, follows incidents in which Australian-based companies Intrepid Mines and Churchill Mining were stripped of rights to mineral deposits estimated to be worth billions of dollars.

Moody’s lead sovereign analyst for Indonesia, Christian de Guzman, said regulatory uncertainty now plagued every level of the nation’s government.

“When you look at the production picture for oil in particular, that says it all. Peak oil production for Indonesia was some time in the late ’90s or early last decade and it’s been falling ever since because the investment climate hasn’t been great,” he told the Weekend Financial Review.
No guarantees after SBY leaves office

“While the President has placed an explicit guarantee [on contracts with BPMigas] we don’t know what will happen once he leaves office.”

Australian oil and gas producer Santos, which has production and exploration assets in Indonesia, declined to comment on the implications of the demise of BPMigas on Friday.

Other large oil and gas players in Indonesia are believed to have taken some comfort from President Susilo Bambang Yudhoyono’s decree that oil and gas contracts signed with the regulator remain in place.

Churchill Mining, which is listed in London and based in Perth, is seeking more than $2 billion in damages from the Indonesian government after lucrative Kalimantan coal mining licences were revoked by local officials.

Chairman David Quinlivan said for all Indonesia’s promise as an investment destination, he would not try his luck there again.

“I’m disappointed that these sort of things are still happening,” Mr Quinlivan said from Denver. “We went there knowing that Indonesia had a reputation. But we probably went there a little naively, knowing what could be done and knowing how things could be manipulated.”
Intrepid Could lose $100m investment

Intrepid is trying to wrest back control of the giant Tujuh Bukit copper and gold project in East Java after being kicked off by its local partner in July for no clear reason. The Brisbane-based company sunk $100 million into exploration on the site and is in danger of losing the investment.

The federal government urged business to develop closer ties to Asia in its Australia in the Asian Century white paper.

Former Australia Indonesia Business Council president Chris Barnes, who runs an advisory service for companies looking to invest in Indonesia, says the country is still a great place to put your money. “You shouldn’t judge the investment climate in Indonesia by one or two high-profile examples,” he said.

“The issue in Indonesia in terms of the demographic profile, in terms of the recent level of economic growth, looking at the rising middle class and the macroeconomic management of the country, shows that there are very solid fundamentals there for investment.

“Yes, there are opportunities but there are also risks and it’s all about making sure you manage those risks appropriately.”

Robert Millbourne, partner with law firm Norton Rose, said while caution was required, the opportunities for business in Indonesia were so great that he would never advise on making the country off-limits.

“It is a complex jurisdiction; it’s always been that way,” he said.

“But there are ways of securing your investment, either through a bilateral investment treaty or political risk insurance that will mitigate many of the potential concerns that have come to light.”

[fungus pudding]

If you buy a home in Spain worth more than $200k (US) then you get free permanent residency with it :-)

There's always a downside.

[777]

This arrived from HotCopper.

Interesting a share commentator are forwarding this sort of information.



UNIQUE BALI VILLA RESORT


This villa resort is situated towards the southern end of Bali in the Jimbaran Bay area. Conveniently located just over 7km from the airport and just under 10km from central Kuta. This popular tourist destination is approximately halfway to the capital Denpasar.
Bali is one of the most sought out holiday destinations for Australians. The number of Australian visitors, to our nearest north-western neighbour, has more than tripled in the past decade, making Australians the biggest single group to visit the tropical island.

This is a wonderful opportunity for a family or group of friends to own their own piece of paradise, in this beautiful and breathtaking tropical resort.


7 private villas - mix of 1, 2, 3 &4 bedroom villas

Stunning two level restaurant overlooking resort pool

Fully equipped Day Spa complex

Each villa includes private plunge pool

Located in Jimbaran Bay only 10kms from Kuta and 7kms from the airport

To find out more on this property, view the commercial listings on the Knight Frank website








Todd Schaffer
Executive, Commercial &Investment Sales
0409 090 855
todd.schaffer@au.knightfrank.com


Vincent Siciliano
Executuve, Commercial &Investment Sales
0488 355 535
vincent.siciliano@au.knightfrank.com




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