How to Check a Developer on Bali

Every sunset villa looks perfect in renderings — but behind the tropical dream, not every developer builds on solid ground.

Bali’s real estate market is thriving. From ocean-view villas in Uluwatu to boutique apartments in Canggu, new projects launch every month. Yet behind the growth, not all developers are equally reliable. Before you sign a contract or transfer a single dollar, it’s essential to verify your developer — legally, financially, and technically.

This guide by DDA Real Estate explains how to conduct due diligence and protect your investment in Bali’s property market.

1. Check the Company’s Legal Status

Start with the foundation — make sure the developer is a registered legal entity in Indonesia.

What to request:

• Company documents (PT or PT PMA if foreign-owned).
• Registration with BKPM (Indonesia Investment Coordinating Board).
• Valid NPWP (tax ID) and NIB (business license).
• Proof of land ownership or lease: Hak Milik (freehold) or Hak Sewa (leasehold).

Red flag: verbal claims like “the land is in process” or “we’ll transfer it later” are common traps. Insist on written, notarized proof.

2. Review the Developer’s Portfolio

A credible developer always shows their track record:

• Completed projects (with locations and handover dates).
• Actual site photos or drone videos.
• Client testimonials or Airbnb/Booking.com listings.
• Compare what was promised in earlier projects (finishing quality, timeline, facilities) to what was delivered.

Tip: Search previous buyers’ feedback online — it often reveals more than glossy brochures.

3. Verify Land and Building Permits

Since 2021, PBG (Persetujuan Bangunan Gedung) replaced the old IMB permit system. Make sure all documents are active and issued in the developer’s name.

Permit	Description	Why It Matters
PBG	Building approval (replaces IMB)	Confirms legal right to build
SLF	Certificate of occupancy	Required for handover
Pondok Wisata	Short-term rental license	Mandatory for Airbnb-style operations

Projects without PBG or Pondok Wisata may face shutdowns or fines — even if they look legitimate.

4. Check the Payment Structure and Escrow

A reliable developer provides escrow or notary-controlled payments.

Typical secure payment plan:

• 20–30% deposit after signing the agreement.
• Staged payments tied to construction progress (foundation → walls → roof → finishing).
• Final 10% upon delivery and SLF issuance.

Avoid upfront payments above 50% — especially if no escrow is used or construction hasn’t started.

5. Investigate the Team and Reputation

Ask questions that go beyond marketing:

• Who are the founders and where are they based?
• How many years have they operated in Bali?
• Do they have in-house construction or outsource everything?

Then, research independently:

• Search their company name on Google Maps, LinkedIn, and Google Reviews.
• Join forums like Bali Expat Community or Bali Property Investment Network — investors often share experiences there.
• Cross-check names of directors with past projects.

Warning: if all you see are 3D renders and no land development — it’s likely a speculative project.

6. Hire an Independent Notary or Lawyer

Never rely on the developer’s “recommended” legal team. Hire your own Indonesian notary (PPAT) or English-speaking property lawyer to:

• Verify land titles and company licenses.
• Confirm lease terms and duration (25–80 years).
• Ensure your name or PT PMA is correctly listed in all contracts.
• Register the transaction with BPN (Land Office).

DDA Real Estate collaborates with vetted notaries who specialize in property transactions for international investors.

7. Visit the Construction Site

Physical verification matters. Visit the site — or delegate it to a trusted agent — and evaluate:

• Actual construction progress.
• Quality of materials and finishes.
• Availability of infrastructure (access roads, utilities, drainage).

If you can’t be in Bali, request independent photo and drone reports from a local inspector.

8. Common Red Flags

Bali’s real estate scene attracts genuine professionals — but also opportunists who rely on marketing, not transparency. Before you invest, watch for these warning signs:

• “Guaranteed ROI of 20% per year.” If a developer promises double-digit guaranteed returns, it’s a red flag. Even in Bali’s most profitable areas, the realistic ROI is 8–12% annually for short-term rentals. Anything beyond that likely means the company is covering payouts from new investors — not from real rental income. Sustainable projects rely on location, management, and occupancy, not hype.
  Rule of thumb: If it sounds too good to be true, it usually is.
• Missing or fake building and rental permits (PBG / Pondok Wisata). Some developers start construction before obtaining a PBG (building permit) or promise that the Pondok Wisata rental license will come “later.” Without these documents, your property can’t be rented legally — or might even face closure and fines. Always ask to see official permits with government stamps and company names that match your developer’s legal entity.
  Pro tip: Real permits are bilingual (Bahasa Indonesia + English) and include a registration number you can verify with local authorities.
• No escrow, no milestone-based payments. Reliable developers use escrow accounts or notary-controlled payments, where funds are released in stages as construction progresses. If someone asks for 50–70% upfront “to start building,” that’s a massive risk. If the project stalls or the company disappears, recovering your money will be nearly impossible.

Always Insist On:

• Payment by construction milestones (foundation → structure → finishing).
• Legal oversight by a notary or lawyer.

Refusal to share legal documentation. Transparency is non-negotiable. A trustworthy developer will willingly share:

• PT or PT PMA company registration,
• Land ownership certificates (Hak Milik / Hak Sewa),
• Tax documents (NPWP),
• PBG and Pondok Wisata permits.

If instead you hear “we’ll show it after you sign” or “documents are in progress,” it’s a sign of disorganization — or something worse. Ask politely, but firmly. A professional developer is proud to show their paperwork; a dishonest one avoids the topic.

Pressure Tactics and Emotional Sales Pitches

Phrases like “only two units left,” “price increases next week,” or “foreign buyers are lining up” are classic pressure tools. Developers who push urgency often want to close deals before investors have time to check the details. Real opportunities don’t expire overnight — fake ones do.

Bottom Line:

Serious developers rely on documentation, not persuasion. They’ll walk you through legal steps, show you real progress, and never rush your decision. Before you sign anything, slow down, ask questions, and verify everything — it’s not just your money, it’s your future investment security.

9. Investment Outlook — Why Diligence Pays

Bali’s property market is shifting toward eco-luxury, wellness, and digital nomad developments — especially in Uluwatu, Canggu, and Karangasem.

Investors who choose verified developers enjoy:

• Consistent rental yields of 8–12% annually.
• Strong resale potential due to limited land supply.
• Long-term legal security via PT PMA ownership.

“Due diligence is the real first investment — everything else comes after.”

Step	What to Verify	Who to Contact
Legal entity	PT / PT PMA documents, BKPM registration	Developer / Notary
Land status	Hak Milik / Hak Sewa ownership proof	BPN (Land Office)
Construction permits	PBG, SLF, Pondok Wisata	Local government
Payment process	Escrow, milestone-based schedule	Bank / Notary
Legal assistance	Contract verification, registration	Independent Lawyer
Developer history	Completed projects, online reviews	DDA Real Estate / Public records

Read Also: “How To Find the Best Real Estate Agents in Bali”, “How Foreigners Can Own Property in Bali", “Why Should You Invest in A Beachfront Property in Bali”.

Every villa starts with a dream — but only verified developers turn that dream into a safe investment. Before you buy, inspect the company, permits, and payment system. A few days of due diligence can save years of legal trouble.

At DDA Real Estate, we help investors verify developers, check permits, and structure secure property deals in Bali’s most promising locations.

Smart due diligence today means real profit tomorrow.