Indonesian Currency

What is a rupiah you might ask.  Rupiah is the national currency of Indonesia, aka IDR (InDonesian Rupiah).  $1 USD = 13.295 IDR (at the time of this writing).  To check the rate, open Google and type USD to IDR and you will have the current exchange rate.  When I first moved to Bali in 2012, the exchange rate was $1 USD = 9.800 IDR.  That is better than 35% increase in buying power.  Some might want to call that inflation, but if you use a bottle of beer as the standard, there has been no change.  


In Indonesia, all prices must be quoted in Rupiah.  This is to help stabilize the currency. It becomes easier to remember that 1 juta (which is 1 million Rupiah) is about $100 USD (it is really about $75, so subconsciously you are only paying about 75% of what you think).  When you sit down for lunch and the price of fried rice is 10.000 rupiah, in your head you are thinking $1 but remember it is actually 75 cents.  It might take you a little time to train your brain, but in the end, you are paying less than you think.


So, let's put all of this in terms of housing costs. Foreigners have several options.  You can lease a house, or a villa (the biggest difference is a villa is a bit more westernized and usually has a pool).  Leases can run from a month to several years with the total price paid up front.  For example, a three month lease on a 2 bedroom villa will run around $1000 USD a month around Lovina on the north coast of Bali.  That is $3000 that you pay in advance.  A one year lease might cost you $6000 up front.  At the end of the year, you can negotiate another year, or perhaps you have found a better deal in a different location.  Bottom line, your housing investment is gone forever.  


Another option is to "buy" a house/villa or an apartment.  The law that took effect in 2016 allows foreigners who reside in Indonesia to purchase (what is really a "right of use" for 80 years) a landed house or an apartment.  This link lists the minimum prices based on the location within Indonesia and other topical information (ie: no rentals, must reside in Indonesia...if you leave, you must sell within 12 months).


Click to read this article for more information on foreign ownership.


Option number three is to purchase property with a right of use title and build a house. You must renew the title every 30 years. The maximum renewal limit is 80 years.  The land then reverts to the government.  Again, you must be a resident of Indonesia, if you leave you must sell.  


View of the pool house and pool at The Retirement Village at Tegallinggah

Last, but not least, is to buy an apartment in the only dedicated all apartment retirement community in Bali. The Retirement Village at Tegallinggah is a US based, nonprofit, 55+ cooperative.  As with any Retirement Co-op, you are purchasing stock in the Co-op which entitles you to a proprietary lease on the apartment of your choice in our full service retirement village in beautiful Bali.  Because we limit equity increases to 1% per year, the apartments remain affordable to retirees as well as facilitating prediction of future value.  If you buy today for $130,000 USD (note this is approximately $20,000 USD less than the minimum price set for foreign "purchase" of an apartment in Bali) in 5 years you sell for $136,500 USD.  Rather than losing your money on a 5 year lease, you actually pocket $6,500.  Your maintenance fee of $200 per month equates to $12,000 over that 5 year period, which is reduced by over 55% by the profit you make on the sale.  It works out to less than $100 a month to live in paradise.  You can choose the half year option, you are not required to sell if you leave Indonesia, your apartment can be passed down to heirs and they don't have to sell it if they don't live here. 


Refer to our website to see what the monthly maintenance fee covers, and I think you will agree that you can't afford NOT to live here.