67.6% of Bali Homebuyers Use Mortgage Financing as Cash Purchases Remain Difficult
According to Bank Indonesia's Bali provincial office, mortgage loans (KPR) accounted for 67.6% of property purchase transactions in Bali, as rising property prices make cash purchases increasingly difficult for buyers. The residential property price index accelerated in Q2 2026 compared to the previous quarter.
Achris Sarwani, Head of Bank Indonesia's Bali provincial office, stated that mortgage loans (Kredit Pemilikan Rumah, or KPR) remain the dominant payment method for property transactions on the island. This financing scheme has become the primary tool for the middle-income population to secure housing amid rising property prices.
According to Sarwani, as reported by Antara, "The KPR scheme holds the largest share of home purchase transactions, reaching 67.6% of total sales."
Based on the Residential Property Price Survey (SHPR), Bali's Residential Property Price Index (IHPR) grew by 1.02% in Q2 2026, an acceleration from the 0.87% growth recorded in Q1 2026.
This price index increase was driven by rising prices in two housing categories: medium-sized homes with building areas between 36 and 70 square meters, and larger homes exceeding 70 square meters.
This trend has indirect implications for foreigners considering property investment or purchases in Bali. The growing reliance of local buyers on mortgage financing signals continued upward pressure on overall property prices, which is a useful indicator for foreigners tracking cost trends when purchasing or leasing land and buildings on the island.
Things to Consider
Given the rising price trend, those considering property purchase or long-term rental in Bali should gather information early and consult reputable local real estate agents and lawyers. Since foreigners cannot directly own land in Indonesia, verify appropriate legal structures such as leasehold agreements or setting up a PT PMA (foreign investment company) in advance, and always check land certificates with the National Land Agency (BPN) before signing any contract.
Source: JPNN.com Bali