Updated 7 months ago

Many expatriates in Indonesia turn to renting options for the duration of their stay and, luckily for them, there are a variety of options of varying standards.

Foreigners are not allowed to own land in Indonesia, except for a few foreign-owned limited liability companies with direct foreign investments. Foreigners can only buy land if they are married to an Indonesian national, with a prenup, and if the land is under the Indonesian's national's name. Under certain circumstances and strict conditions, an expat may be able to buy an apartment. 

Many foreign professionals are given company housing as part of their package, which comes to an end at the same time as their employment contract. However, if this is not applicable to your situation then there are many types of accommodation for you to choose from, depending on your budget, family situation, and location in the archipelago.

Types of accommodation in Indonesia

If you're living in a developed area, such as Jakarta and Bali, then many Western-style apartments and condominiums are available, providing a relatively high standard of living. There are also plenty of houses and townhouses to rent in these popular places (some are in luxurious housing estates), and contracts usually last between one to three years. Do note that furnished houses are often rented for twice the price of unfurnished properties, but start-up costs for renting an unfurnished house can also be very expensive.

 Good to know:

Although many homes have air-conditioning, only the more modern houses, such as those in high-end gated communities, tend to have hot water geysers.

Both Western-style apartments and houses may be slightly harder to find if living in more remote areas of Indonesia outside of the main cities. Houses are still available in most villages and towns, but most of them are owned by local families who have lived in them for generations and continue to do so.

If you are a single expatriate on a budget, you may be interested in living in a kost, which is a unique phenomenon in Indonesia. A kost is typically an informal guesthouse with between 5 and 30 small rooms that can be rented individually, as well as a shared kitchen. It is similar to a boarding house or a residential hotel, and most are single-sex kosts, and they are particularly popular amongst foreign students or young, single professionals. They sometimes have their own private bathrooms, and contracts vary in length.

It is also possible to rent a bedroom in an Indonesian family's home, and you can even negotiate for meals and laundry to be included for a fee. This type of rental is usually informal and is often made after making friends with an Indonesian family.

Alternatively, you can even rent a room in a hotel or a penginapan (lodge) on a long-term basis, and the price can be negotiated depending on the duration of your stay.

Lease agreement in Indonesia

Indonesia is one of the few Asian countries where it is common for landlords to require tenants to pay the rent upfront for the entire duration of a lease, which is normally a one- or two-year period. However, both the amount (including potential instalments) and the duration can often be negotiated through a rental agency. All transactions should be conducted in Rupiah, and not any other currency. If the rent is priced in USD for instance, it usually means that it's overpriced.

Unfortunately, a strict implementation of building codes isn't always enforced on residential properties in Indonesia, and landlords are notorious for renting buildings that are below standard, or for not doing proper repair work. Given the costs and risks involved, every tenant should, therefore, be very vigilant when considering signing a lease. It's important to conduct a thorough audit — including examining the furniture, structure, electricity, plumbing, air-conditioning, and waterproofing — of the property before signing anything. You can hire a specialist company to conduct this property audit for you, but be sure to ask for their credentials before you hire them.

It is also a good idea to ensure that the property you rent has an Electrical Leakage Circuit Breaker (ELCB), supplied by the government, installed for your safety as a tenant. This is not very expensive, but many landlords still choose to forgo its installation. If there's no circuit breaker, it's better to not rent the place, as it means that the supply might be coming from an illegal source.

Before you sign the lease, outline any problems and possible risks that you have discovered based on the report. A formally written list will give you more bargaining power with the landlord so that you can request for the defective or missing items to be repaired or installed.

Finally, be sure to also read your contract thoroughly and sign it in the presence of a notary, particularly if you have certain stipulations.

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Knight Frank

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