Most foreign buyers in Lombok choose between two structures, and a third one exists that avoids the choice entirely. The decision is not about prestige or safety, it is about whether you intend to run a business. Get it wrong and you either pay for a company you never needed, or you let property commercially without the licence to do it.
Side by side
| Compare | Leasehold | PT PMA | Unit lease |
|---|---|---|---|
| What you hold | A notarised lease, 25 to 30 years | Building rights (HGB) in your company | Income and use rights to one unit |
| Set-up cost | Notary fees only | About IDR 29 million in notary fees, plus due diligence | None beyond the price |
| Ongoing cost | None | Accounting and reporting, about IDR 2 million a month | None |
| Can let commercially | Not in your own name | Yes, that is the point | The operator does it for you |
| Effort | Low, until you want income | High: director, commissioner, filings | Low by design |
| Suits | Personal use, occasional letting via a manager | A real rental operation or several properties | Smaller tickets, income without management |
When a PT PMA earns its keep
A PT PMA is an Indonesian company with foreign ownership that can hold building rights and legally operate a rental business. Forming it takes two to three weeks through a notary and needs at least two shareholders, a director and a commissioner. The company opens its own bank account. Some banks arrange this remotely, others want the director present, so ask before you plan around it.
It pays off when there is a business to run: several units, year-round letting, staff, and revenue that justifies the filings. For one villa used privately for part of the year, the formation cost plus monthly accounting is money spent on structure rather than on the asset.
When a leasehold is enough
A notarised leasehold is simpler and cheaper. You hold the right to use the property for the agreed term, and you can usually sell the remaining years or pass them on, though most leases require the landowner's consent, so read that clause rather than assume it. Two things decide whether a given lease is good: how many years remain, and whether the extension terms are written down now rather than promised later.
The third option: let someone else hold the structure
In a managed resort, the operating company holds the land lease and the licences, and you hold a contract with that company for one unit. There is no company to form, nothing to file, and no need for the licence to rent, because you are not the one renting it out.
That is how Habitat CoLiving Kuta works. The operating company, PT Habitat Coliving Kuta, holds a 30-year land lease and runs all 20 studios as one hospitality business. Four studios are offered as unit leases from USD 50,000. Each participating unit receives an equal share of net distributable profit, paid quarterly with a report, and you can live in your own studio for a month or more on 60 days' notice.
Deciding in practice
- Will you let it commercially, in your own name? If yes, you need a PT PMA.
- Is it mainly for your own use? A leasehold is simpler and cheaper.
- Do you want income without running anything? A unit lease in a managed building fits, and keeps the ticket smaller.
- Several properties planned? Form the company before the first purchase rather than restructuring later.
Whichever you choose, the structure is set when you sign. Have an Indonesian notary confirm it matches what you intend to do with the property, and a tax adviser at home explain how the income is treated there. The full guide to investing in Lombok property walks through the contracts you will see.
Common questions
Do I need a PT PMA to earn rental income in Indonesia?
To run a rental business in your own name you generally need a PT PMA, because commercial letting is a licensed activity. You do not need one to hold a unit lease in a managed resort, where the operating company runs the business and pays you a share of the profit.
Which is cheaper, a PT PMA or a leasehold?
A leasehold has no company set-up or annual reporting cost. A PT PMA costs around IDR 29 million in notary fees to form plus optional accounting of about IDR 2 million a month, and it earns that back only if you are running a real rental operation.
Can I convert a leasehold into a PT PMA later?
The structures are separate agreements, so switching means renegotiating with the landowner and transferring the lease into the company. Decide the structure before you sign, with your notary.