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How to buy a property in Batam: Tropical homes on Singapore’s doorstep

With tighter curbs on Singapore property, residents are increasingly looking for luxury homes in the region that are in close proximity but cost a fraction of what they would here. Many expats working in Singapore who go searching for a tranquil, tropical escape with top-class food, golf, spas and the rest, usually look to Bali, Phuket, Samui and Lombok only to find they’re not always that practical. The cost of airfares, the availability of flights, and the travel downtime all become factors – what if you suddenly have an urgent meeting to attend back in Singapore?

 

It was by pure chance that we stumbled across Batam as a prospect a few years ago, and found that it ticked all the boxes. One of Indonesia’s Riau Islands (along with Bintan), Batam sits 20km off the south coast of Singapore, and is just a 35- to 45-minute ferry ride away. It therefore makes for a perfect marriage of convenience for commuters, expats working in Batam, retirees, companies or those seeking a holiday home. That might come as a surprise to some, since Batam doesn’t have a reputation as a tropical escape, yet I know quite a few expats there – some have lived there for over 20 years – who really enjoy the lifestyle and the fact that it’s much more affordable than Singapore.

It’s also far less populated. Batam is approximately the same size as Singapore but with just one fifth of the people. Yet it maintains close economic ties with Singapore and, as a Free-Trade Zone, has hugely encouraged investment and business connections between the two islands.

According to one Batam website (expat.or.id), there are over 3,000 expats living on the island. Approximately 80 percent are from other Asian countries and the rest from the likes of the UK, Europe, Australia and the US. Popular areas for expats include the golf and resort area of Nongsa (there’s a direct 35-minute ferry from Tanah Merah to Nongsapura) and the area around the Indah Puri Golf Resort (45 minutes from Harbourfront to Sekupang). Up to 30 ferries a day mean no long delays, no traffic jams, and a very safe bet you will get to your destination (door to door) within two hours.

Return ferry fares range from $40 to $60 (compare that with an airfare) and there’s a $10 visa charge at the other end for non-ASEAN residents. Yes, this can take up a chunk of your passport if you’re regularly heading over, but arranging a business visa and a smart card to minimise immigration procedures is neither difficult nor expensive.

As with any lifestyle purchase, it’s best not to look at property here as an investment (keep that for Singapore!); rather, enjoy it for what it provides – any financial profit is pure bonus. Having said that, people who bought units at Montigo Resorts Nongsa off the plan three years ago have already doubled their money.

All land in Batam is leased by BIDA (Batam Industrial Development Authority) from the Indonesian Land Authority for a period of 80 years, after which it is expected that contracts will revert to the Indonesian Land Authority and will probably be treated the same way as in the rest of Indonesia. In view of this, land in Batam can only be leased: 80 years for Indonesians, 75 years for foreigners. When a sale is effected, it usually takes one month to transfer the land lease contracts via BIDA.

Weighing up the running costs of buying a property in a resort complex compared with those of buying a standalone home, they seem to even themselves out. A complex such as Montigo Resorts gives you the hotel facilities with a monthly maintenance fee ranging from $500 to $800, plus the option of a rental package to enjoy a return on your investment. A villa independent of a resort also has the rental option, and the monthly cost of around $800 includes two live-in staff and maintenance of the swimming pool plus utilities.

Although Batam’s beaches aren’t fabulous, boating types have great fun visiting the much better beaches on many nearby islands; and, of course, keeping a boat in Indonesia is again a more affordable option. As far as shopping goes, you can find most of what you need in the shops in Batam, but for those hard-to-find-items most expats head over to Singapore once or twice a month. For golfers, some of the properties, such as the two Balinese villas near the Indah Puri Golf Club (see below), come with golf membership.

For us, the plan is simple. While we currently find time to go over for a night or two and enjoy a game of golf, in the future we will be based in Batam and will come back to Singapore for work commitments, appointments or events as required.

Like the sound of this? Check out our selection of properties for sale on Batam here…

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