Semarang may be the perfect place if you’re a foreigner looking to invest in Indonesian real estate. This vibrant and dynamic city in Central Java offers a unique blend of historical and cultural heritage, modernity, and natural beauty. Semarang’s strategic location, with a bustling port and excellent transportation infrastructure, makes it an attractive destination for investment.
The real estate market in Semarang is thriving, with a diverse range of properties available, from traditional Javanese houses to modern apartments and commercial buildings. This guide helps foreigners how to buy property in Semarang.
Can foreigners buy land and property in Semarang?
Semarang, the cultural capital of Java, offers opportunities for foreigners to invest in real estate, such as houses, apartments, land, and commercial buildings. Despite Indonesian laws and regulations protecting the housing market from foreign investment, Semarang welcomes foreign buyers with viable options for purchasing a property. Nonetheless, acquiring real estate in Semarang may present specific challenges.
Buy real estate on Java
Although Semarang has distinct regulations, similar guidelines apply to other cities. It’s worth noting that certain local restrictions may be enforced in specific locations, making it essential to seek guidance from a local real estate company when dealing with regulations. To successfully navigate Semarang’s real estate market, seeking expert advice is the best approach.
Property ownership on Java
Semarang and other cities and towns in Indonesia provide three options for property ownership: Hak Milik (Right to Own), Hak Pakai (Right to Use), and Hak Guna Bangunan (Right to Build). Although Hak Milik is regarded as the superior form of property ownership, foreign buyers cannot obtain it.
Get help with buying property in Semarang
How can foreigners buy property in Semarang?
Foreign buyers can use a PT PMA (Perseroan Terbatas Penanaman Modal Asing) to buy property in Semarang. A PT PMA is a foreign-owned company and so legal entity. It’s essential to note that the PT PMA owns the property rather than the individual foreign buyer.
Moreover, the PT PMA can be used to obtain a residency permit, so-called Working KITAS or Investor KITAS, enabling foreigners to stay in Indonesia for up to 24 months. Through a PT PMA, foreign buyers can obtain the necessary Hak Pakai and Hak Guna Bangunan licenses to use and develop land and property.
Buy real estate in Semarang in 6 steps
Foreigners can buy real estate in Semarang and other cities on the island of Java by following these six steps:
- Establish a PT PMA (a notary, accountant, or visa agency can do this for you).
- Request the certificate for the property you want to buy from the Indonesian National Land Office (BPN).
- Settle the payment and provide proof.
- Provide proof that the conditions for Hak Guna Bangunan or Hak Pakai are met.
- Request the building permit (PBG) to acquire the right to build.
- BPN will issue the property certificate under the name of your PT PMA.
Land and property prices in Semarang
You see an overview of the real estate prices in Semarang in the table below.
|Average buy price||Average price/sqm.||Average rent price||Annual growth||Rental yield|
|House||IDR 660 million ($42,900)||IDR 9.2 million ($598)||IDR 43.8 million ($2,847)||– 19.1%||+ 79.6%|
|Townhouse||IDR 761 million ($49,465)||IDR 11.1 million ($722)||–||+ 16.8%||–|
|Commercial||IDR 3.5 billion ($227,500)||IDR 10.7 million ($696)||IDR 180.1 million ($11,707)||– 16.4%||+ 62.5%|
|Apartment||IDR 540 million ($35,100)||IDR 20.3 million ($1,320)||IDR 55.8 million ($3,627)||– 64.8%||–|
|Land||IDR 279 million ($18,135)||IDR 1.9 million ($124)||–||– 33.6%||–|
Reasons to invest in Semarang real estate
Semarang is one of the fastest-growing cities in Indonesia, with a booming economy and a rapidly expanding population. As a result, demand for property is consistently rising, which translates to the potential for significant capital gains and rental yields.
The Javanese city is a hub for manufacturing, commerce, and trade, with various industrial estates and ports supporting the city’s economy. These factors make Semarang an ideal location for businesses, increasing the demand for commercial real estate. It is also home to several esteemed universities and is an education hub in the region. This makes the city a hotspot for students and expats, contributing to the demand for rental properties.
Semarang’s rich cultural heritage and diverse arts scene make it an attractive tourist location, leading to a thriving hospitality industry. This, in turn, increases the demand for short-term rental properties such as vacation rentals and Airbnb properties.
Best real estate agencies in Semarang
Foreigners who want to buy real estate in Semarang better seek assistance from a reputable local real estate agent. These agents have the local expertise, market knowledge, and legal understanding to navigate through the complex real estate process in Indonesia. This helps foreigners navigate legal requirements and ensures a smooth real estate transaction.
Get help with buying property in Semarang
Frequently Asked Questions (FAQ)
Can a foreigner buy a house in Semarang?
Foreigners can buy a house in Semarang and can do that in several ways. The best option is to establish a PT PMA, a foreign-owned company that can legally own property in the city.
How expensive is real estate in Semarang?
Semarang’s real estate prices are relatively low compared to other major Indonesian cities, such as Jakarta. These lower prices provide an attractive opportunity for foreigners looking to invest in Indonesian real estate.
Where can I find land or a house for sale in Semarang?
There are various ways to find properties for sale. Local marketplaces, real estate agencies, local newspapers, and online websites are all excellent resources for finding properties on the market. You can also tap into your network by connecting with people who live in Semarang to get insider information about good real estate deals.