Reference · Updated 2026-06-16

The Lombok property glossary

Every Indonesian property, legal and investment term a foreign buyer meets in South Lombok, defined in plain English, from Hak Milik and PT PMA to the difference between gross and net yield. Bookmark it; we keep it current.

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Land titles

Hak Milik (SHM): Freehold: the strongest, permanent form of land ownership in Indonesia. Reserved for Indonesian citizens; foreigners cannot hold it. The certificate is called Sertifikat Hak Milik (SHM).
Hak Guna Bangunan (HGB): Right-to-build title that allows the holder to own and use buildings on land for an initial 30 years, extendable. A PT PMA (foreign-owned company) can hold HGB, making it the main route for foreigners running a villa business.
Hak Pakai: Right-to-use title a foreigner can hold personally, granted for an initial term (commonly 25-30 years) and renewable. Requires Indonesian residency (KITAS/KITAP). Suits a single owner-occupied or owner-let villa without a company.
Hak Sewa (leasehold): A fixed-term lease of land, typically 25-30 years with pre-agreed extension terms. Fully available to foreigners and the most common structure for passive Lombok villa investment.
Girik: Uncertified customary land evidenced only by tax receipts, not a formal BPN certificate. A major red flag: title is unclear and must be converted to a certified right before any safe purchase.

Legal & process

PT PMA: Penanaman Modal Asing: a foreign-owned Indonesian limited company. It can hold HGB title, run a rental/hospitality business legally and repatriate profits after tax. Used when you operate villas as a business or own multiple units.
PPAT: Pejabat Pembuat Akta Tanah: the licensed land-deed official (a type of notary) legally required to execute property transfers in Indonesia. Always engage an independent PPAT, never the seller's.
Notaris: An Indonesian notary who drafts and certifies legal deeds. Many notaries are also PPAT. They verify identities, check certificates and register the transaction with the land office.
AJB: Akta Jual Beli: the deed of sale and purchase executed before a PPAT that legally transfers property rights from seller to buyer. The AJB, not a private contract, is what effects the transfer.
BPN: Badan Pertanahan Nasional: Indonesia's National Land Agency, which issues and registers land certificates. Title is verified and boundaries cross-checked at the local BPN office during due diligence.
Nominee structure: An illegal arrangement where an Indonesian holds freehold 'on behalf of' a foreigner. The side agreement is void in court, leaving the foreign buyer with no enforceable claim. Avoid entirely.
Zonasi (zoning): Land-use zoning set by local government. A plot must be zoned for tourism/commercial or residential villa use; building a rental villa on agricultural-only zoning risks permit refusal or demolition.
IMB / PBG: The building permit. IMB (Izin Mendirikan Bangunan) was replaced by PBG (Persetujuan Bangunan Gedung). No legal villa should be built or bought without a valid building approval.
KITAS / KITAP: Indonesian limited-stay (KITAS) and permanent-stay (KITAP) residency permits. Required to personally hold a Hak Pakai title and useful for running a business on the ground.

Money & tax

BPHTB: Bea Perolehan Hak atas Tanah dan Bangunan: the buyer's land-and-building acquisition duty, roughly 5% of the assessed transfer value, paid on purchase.
PBB: Pajak Bumi dan Bangunan: the annual land-and-building tax. Modest by Western standards but payable every year by the title holder.
Gross yield: Annual rental income divided by purchase price, before any costs. The figure developer brochures quote (often 12-22% for Lombok). It overstates real returns because it ignores fees and vacancy.
Net yield: Rental income after all operating costs (management, OTA commissions, maintenance, utilities, tax and realistic vacancy) divided by total invested. Honest South Lombok net yields run about 7-12%; this is the number to underwrite.
Occupancy rate: The share of available nights actually booked. New Lombok villas realistically run 55-70% in years 1-3 before a review history builds; Bali villas run 70-85%. Occupancy is the single biggest driver of the gap between gross and net yield.
OTA commission: The cut taken by online travel agencies (Airbnb, Booking.com, Agoda) on each reservation, typically 15-20%. A real cost that brochure yields routinely ignore.
Management fee: The villa-management operator's charge, usually 18-22% of gross rental revenue, covering bookings, guest services, staff supervision and maintenance coordination. The largest recurring cost after the OTA cut.
Capital appreciation: The increase in a property's value over time, separate from rental income. In early-cycle Lombok zones, land appreciation (driven by infrastructure) is often a larger return component than yield.

Market & geography

South Lombok: The southern coast of Lombok island in West Nusa Tenggara, Indonesia, the investment frontier covered by HubLombok, spanning Kuta Mandalika, Selong Belanak, Tanjung Aan, Are Guling and nearby coves.
Mandalika: The special economic zone around Kuta, South Lombok, home to the MotoGP and World Superbike circuit. Its events and infrastructure upgrades are the main structural driver of nearby land values.
Are Guling: A quiet cove west of Kuta, South Lombok, an early-cycle frontier zone with the island's highest quoted yields and momentum, where Samudra Villas operates. Lower entry prices, thinner infrastructure than Kuta.
Bali-overflow thesis: The investment argument that rising Bali prices, congestion and saturation are pushing tourists and investors toward Lombok, transferring demand to a cheaper, earlier-cycle market one island east.
Off-plan: Buying a villa before or during construction, usually on a developer payment plan at a lower price. Higher upside but higher risk: it depends on the developer's delivery, so title and track-record checks matter more.
Turnkey villa: A completed, furnished, rental-ready villa sold as a finished product. Higher entry price than off-plan but immediate income and no construction risk.
Liquidity: How quickly an asset can be sold near its value. Lombok is less liquid than Bali: a smaller resale-buyer pool means sales can take months, especially for leaseholds with a shortened remaining term.
Due diligence: The verification done before buying: confirming the certificate and seller identity, checking zoning and building permits, validating access and boundaries, and reviewing the structure with an independent Indonesian property lawyer.

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Every term above, in context, in the complete South Lombok investing guide.

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