Why you shouldn’t buy a villa in BaliSeptember 12, 2009
So there I am, sitting at a bar, talking to a frequent Australian visitor to Bali – a stranger – and he is upset. Really upset. In fact, he can hardly keep track of his own stream of unhappy observations about the awful situation back in his home state, interrupting himself frequently in mid-vent to launch the next load of rhetoric before even finishing the previous one.
Being in somewhat of a lethargic frame of mind (well, it was late, and it had been a long day), I finally understood that he was referring to “those bloody ***s” (nationality deleted because it doesn’t really matter – but let’s call them bool-AY?, with an upward inflection, because he was from Queensland).
Him: What really bugs me is that we don’t own anything there anymore … they’ve bought it all!
Me: Like what?
Him: Our land! Houses! Hotels! Factories! It’s all theirs! We’re losing everything!
Me: But we sold it to …
Him: … and that is so wrong! It’s our birthright they’re buying! There should be a Law (mutter, mutter, mumble)
So this goes on for a while, as pub conversations tend to do, and some of the heat dissipates according to the inevitable laws of entropy and we move on to other topics. I am pleased, because I tend to get distressed when exposed to too much alcohol-assisted jingoistic fervour.
Me: So, you here on holiday?
Him: No, no – I’m here to buy a villa. Moving here in two months.
Me: You getting a 20-year lease?
Him: Oh no, I’m going to buy one freehold …
Me: Mmmm. Well, as a foreigner, you can’t actually own land in Bali …
Him: Yeah, yeah, I know all that – but that’s easy to get around. (He nudges me; thankfully, he doesn’t actually wink.) I just use the name of a local and stitch him up with a watertight contract which gives me use of the property. For ever. (Smugly) It’s called a name-giver deal – the agent explained it all to me.
Despite myself, I feel obliged to clarify that, while ‘circumventing’ Indonesian property ownership laws appears possible using a name-giver contract scheme, it’s actually a lot more complex. For a start, the ‘contract’ itself is considered to be void ab initio (i.e. unlawful from the start and therefore unenforceable) by some legal practitioners in Indonesia, partly because it refers to a non-existent transfer of money between the parties during the so-called ‘purchase’ transaction. Then, of course, there is the ever-present possibility that the local name-giver decides that since the freehold title (the Hak Milik) belongs to him, there is nothing to stop him from just taking over the property at some stage in the future. I point out that this has happened a number of times in the past.
I foolishly go on to explain that you may manage to perform tricky manoeuvres to sidestep the actual wording of the law – which says that a foreigner can’t own land. But what you can’t do is avoid the provisions of the Indonesian Constitution, which says that a foreigner can’t control land. I tell him that the whole freehold-buying scheme could potentially fall in a heap, because that gives the foreigner control over the property. And that leasing is much, much safer. And that it would be prudent to abide by Indonesian law while a guest in this country. This somewhat agitates my new best friend.
Him: (suspiciously) You some kind of socialist intellectual or something?
I hastily deny this, because such deviants are not generally permitted in Bali pubs, and if they did inadvertently sneak in, they would be mercilessly mocked, especially by my countrymen. It takes a considerable amount of time talking about beer and football before he is convinced that I have the necessary cultural pre-requisites to continue the conversation.
Him: I don’t like this leasing stuff. Doesn’t happen back home. I pay the money, I get the freehold.
Me: Unless you live in Canberra … most properties are on a 99-year renewable lease there …
Him: Huh? … Whatever. Anyway, that’s not the point. I don’t want to lease, I want to buy a villa here – and I can’t see why the locals should have these restrictive laws that are stopping me.
We briefly discuss the significance of land ownership for the Balinese, their culture and family structure, but I can tell he’s not really interested, even though we use approved pub language, much bagging of all and sundry and various male bonding rituals. He knows what he wants and anything that obstructs that desire needs to be made to vanish.
Right about then, I assist this process (of making me vanish) by committing a tactical blunder. I remind him that he started out being furious at those reprehensible Bool-AYs who are buying up property in his home state, thus dispossessing him of his birthright. And yet, when I point out that that is exactly what he, as a bule here, now wants to do in Bali, he is genuinely mystified. “How can you say that?” he says, “… it’s completely different!” For once, I am speechless. How is it different?
It could have come to raised voices, if not actual blows, but we ended up parting on reasonably amicable terms, although his demeanour and body language clearly showed that he thought that I had the reasoning capacity of a dog biscuit. Maybe I have. Maybe my belief that the right to legislate property ownership laws in this place belongs to those who historically and culturally have a claim to it has clouded my logic. Maybe logic has nothing to do with it.
But I can only hope that, on reflection, my temporary friend will come to believe, as I do, that there is no difference between his ire at foreigners owning land in perpetuity in Australia and that of Indonesians when faced with the loss of their birthright here. Under current laws and constitutional guidelines, ‘freehold’ ownership of propery by non-nationals remains problematic.
But gee … wouldn’t it be nice to actually own a villa in Bali?
Posted in EXPAT LIFE | Tagged Bali, bool-AY, borborigmus, bule, buying a villa in Bali, constitution, contract, expat, EXPAT LIFE, freehold, hak milik, Indonesia, Indonesian, land ownership, law, lease, leasing, name-giver, property ownership, villa, Vyt |