Thread: Property Ownership Indonesia

mm.. well i agree with canubee on the point about self regulation not working.. i'm a licensed realtor in bc, canada (forgive me), though i'm not active.. it is strictly regulated here and the market has benefited significantly from that regulation and transparancy.. one thing for example that often happens in bali is that you might be looking at a property.. the guy who's showing it claims he's representing the seller, but in fact he's not... he's connected to the actual seller through 3 other agents all wanting their slice of the action.. so the seller may only be asking 50m per are, but the agent showing you is saying the seller wants 80m per are... the deal doesn't go through and who misses out? the seller and the buyer... if the system was regulated, you could have an effective multiple listing service that allows agents to cooperate in an effective, transparant manner (i.e. www. mls.ca, http://www.reiwa.com.au) - one central listing service - it's very effective and would help mature the sometimes disturbingly patchy balinese real estate market..

i also disagree about the comments made about singapore.. i believe singapore is a great nation that while some may argue is not entirely democratic, acts in the best interests of it's citizens and has all but stamped out corruption and faciliated the formation of a peaceful, prosperous, multi-cultural society.. if indonesian politicians shared in the wisdom of singaporean legislators, indonesia may one day be a great nation..

Multiple Listing is a 1950's anachronism that no longer has any relevance. It has been or soon will be totally supplanted by the internet.

I am not arguing against the regulation of real estate. In Indonesia it is regulated by law and in Bali as Bert said by local adat. I defy anyone to name a country where real estate agents have special status under the law that allows them to "self regulate". As far as I can ascertain they don't in Canada. In fact many countries are moving away from self regulation that is recognised under the law for professionals such as doctors and lawyers.

The type of "self regulation" that was proposed above is where agents are encouraged to come up with a code of ethics and conduct and voluntarily subscribe to it. That is supposed to engender feelings of trust in the buyer? I'm not buying it.

If Indonesia becomes a "great nation" like Singapore, a one party state with no free press, no practical separation of powers, a corrupted form of the Westminster legal system, that continues to be rife with nepotism and allows imprisonment without trial and goes to bed with one of the world's largest drug traffickers while hanging small time dealers then God help the Indonesians.

Allan I am surprised you are a moderator as you seem to pick up on points irrelevant to the post - what illegal arms trading and corruption has to do with the topic of property in Bali and regulation is beyond me, and the IEA web site was only provided as one form of self regulation/BaliLife has provided others - the point of my post is that currently there is little to no regulation of the real estate business in Bali and consumers cannot rely on the corrupt Indonesian legal system nor the govt to protect them. I am very active in the real estate sector and I see many deceptive practices amongst agents and developers here - if nothing is done it will only further smear Bali's reputation further. What I am suggesting is a proactive approach to cleaning up the industry and provide some of the protections that consumers need because - the Indonesian/Bali govt is not providing it.

From the tone of your posts I suspect Allan that you do not have much experience in the Bali Real Estate market.

VincentOG - If you think I am wrong - I would urge you - and in fact every foreign real estate buyer in Indonesia to pick up a copy of Sriro's 2007 Indonesian Legal Reference book - this book provides a comprehensive legal overview in English of Indonesian law.

Any questions about the moderators and/or moderating should be addressed to the site administrator, Bert.

There is regulation of the real estate business in Indonesia. It is bound by commercial and contract law as is any other business.

Industry groups provide no regulatory function whatsoever because they cannot apply legal sanctions which is the essential part of regulation. What's worse is groups like the IEA profess to sanction their members but in practice they very rarely if ever do. What examples of self regulation did BaliLife provide?

consumers cannot rely on the corrupt Indonesian legal system nor the govt to protect them.

If that's true then no amount of window dressing by real estate "professionals" will help.

You are right I have absolutely no experience in the Bali real estate market whatsoever.

Gentleman, man your battle stations!!! :-)

You are all making some good points and I will offer the following:

And, no, I am not a real estate agent, but I play one on TV.

Can You - You can write as much as you like about the merit of self regulation but what's that got to do with today’s reality. In fact the RE biz in Bali is presently completely self regulated by all parties involved so buyer beware - and honestly for a buyer to be anything other here in a country with a well known reputation for corruption makes me scratch my head. Yes it would be admirable to adopt a code of ethics. Experienced agents wishing to practice here could do worse than to make ethics central to their identity, no?

Allan – I have to disagree with your write off of the MLS. In a mature market like the US it may be a low risk effort to purchase direct from an owner found via the net. But as there is no central listing site it can be a pain in the butt to search, much less arrange inspections and to do biz with FSBO's. Good agents offer a service they get paid for. I think you will find that while fees may be impacted by the net it is agencies who will master its use. As for buying in a place like Bali, I guess that's up to whoever is doing whatever :-).

General - As far as the gov being greatly concerned with the interests of foreign real estate investors in Bali, I'm thinking it's not high on their list.

Allan – I have to disagree with your write off of the MLS. In a mature market like the US it may be a low risk effort to purchase direct from an owner found via the net. But as there is no central listing site it can be a pain in the butt to search, much less arrange inspections and to do biz with FSBO's.

I am not suggesting that people buy direct from the owners and I have nothing against real estate agents. Agents provide a valuable service by coordinating the photography, signage, advertising, inspections, collection of the deposit etc.

DCC there is no need for multiple listing. The agent simply creates an entry in a well known or several well known advertising websites. The seller can see the advertised price. The old multiple listing service exisited only because of the cost of advertising. The internet has made that problem disappear. Sure Bali may not be that well served by a single or couple of large real estate websites but the writing is on the wall.

As far as ethics goes the worst that an agent can do these days is underquote the expected price for properties going to auction to draw people in, wasting their time. Since auctions don't seem to be used in Bali what's the problem?

I want people to be ethical in their dealings with me. Who doesn't? If someone feels the need to wear a badge saying "I'm not like the next guy. See I have signed a statement that says I'm ethical" it does nothing for me except make me suspicious about their need for such an overt statement.

ok..

firstly, i was saying i do not believe self regulation works. i believe strict legislation requiring licensing of realtors and the implementation of real estate boards to oversee a code of ethics would be a big plus..

secondly, i don't know what basis you have on your accusations about singapore allan, but i believe them to be completely misguided and over simplifying complicated issues.

ct