Pre-sale, off-plan and ready

Pre-sale, off-plan and ready get used as though they were three points on one timeline. They are three different products, with three different risks, three payment schedules and three buyers. The only thing they share is a plot.

What the three actually are

Ready means the building is finished. You can stand in the room, run the tap, see how the concrete has weathered and read the service charge accounts. You are buying a known thing.

Off-plan means construction has started to an approved design, and you are buying a unit that does not yet exist inside a project that visibly does. You are buying a contract to deliver, secured against a site with work on it.

Pre-sale means the earliest units are sold before construction, or in its first weeks, at the point where the developer is raising the money that will pay for it. You are buying the promise and the balance sheet behind it, and very little else.

The commercial logic is one sentence: the less there is to see, the cheaper it should be, because you are being paid to take a risk the developer would otherwise pay a bank to take.

What Indonesian housing law says the stages are

Worth knowing even if you never quote it, because it gives you a benchmark that is not the developer's. Indonesian housing law splits the sale of an unbuilt home into two stages, marketing and the preliminary sale and purchase agreement, the PPJB.

• Before marketing, the developer must hold at minimum an approved local planning letter confirming the spatial designation, a land certificate, certainty of the tenure the buyer will receive, the PBG building approval, and a construction guarantee from a bank or non-bank guarantor.
• The marketing material itself has ten compulsory contents, including the planning letter number, the land certificate number, the guarantor's support letter, the PBG number and issue date, the site plan and the price.
• The PPJB cannot be signed until land ownership status, the agreed matters, the PBG, infrastructure and utilities and at least 20 per cent built are all in place. For houses that is 20 per cent of the planned units plus infrastructure; for a strata block, 20 per cent of construction volume. It is evidenced by the supervising or construction management consultant, not by the developer.
• You have the right to study the PPJB for at least seven working days, it must be signed before a notary, and the developer may not collect more than 80 per cent of the price before those conditions are met.

One honest caveat, and it matters more than the rules do. That regime is written for houses sold as ownership. Whether it binds a foreigner taking a long lease of a villa is not settled and we could not find authority either way. Treat it as the standard the Indonesian state thinks reasonable for an unbuilt home, ask your own advocate whether it binds your contract, and note the answer either way. A developer who meets it voluntarily is telling you something. So is one who will not.

Pre-sale: you are lending, and the interest is paid in discount

At pre-sale your money funds the thing you are buying, and it should be priced that way. Three questions, written down. What is built on the plot today – built, not approved, not mobilised. Who is guaranteeing completion, and with what instrument. And what exactly am I signing, given that a booking form is not a PPJB but a receipt with terms attached.

The discount is the point. It compensates you for financing risk and the longest wait, and if there is no meaningful discount against the same developer's off-plan stock then you are taking the extra risk for nothing. We have no data on the size of that discount in Bali. There are no published sold prices here, so nobody has it, and we will not borrow a figure from a brochure. Ask instead for the price of an equivalent unit in the same scheme at each stage and compare them yourself.

Off-plan: the building exists, and so does the contract

This is where the balance between price and evidence is usually best. There is a site, a permit, a contractor, and enough built for an independent pair of eyes to verify progress. What decides whether it goes well is not the design but the payment schedule, the verification of milestones and the retention, all covered in stage 05, and the developer's delivery record, covered in stage 04.

Two things to fix in writing now rather than later: what happens if the programme slips, meaning a defined date, a grace period and a penalty worth claiming; and who verifies each milestone before money is released, named as a person or a firm rather than a role. The eighteen to thirty months that follow are stage 07's subject.

Ready: less risk, and a different set of questions

Buying finished removes the two risks that dominate the other stages. It changes the subject rather than closing it.

• The SLF. A completed building may not lawfully be used until a certificate of worthiness for function has been issued to the owner. Applied for is a different answer from issued, and on a building already being let it is a serious one.
• Age. Damp, drainage falls, pool plant, corrosion near the sea and joinery that has moved are all visible on a four-year-old building and invisible on a render.
• The remaining term. On a lease or an HGB, years remaining is what you are buying and it has been running down since the day it was signed.
• The operating history. If it has been let there is booking data. Ask for it by month, for two full years, as the operator's statements rather than a summary.
• Defects. The contractual snagging window has usually closed. Indonesian construction law makes the contractor liable for building failure for the period set in the construction contract, capped at ten years from final handover where the design life is longer, but a building failure means collapse or a building that no longer functions, determined by an appointed expert assessor. That is a structural remedy of last resort, not a defects list.

Price, payment and who each suits

The pattern is practice rather than law. Pre-sale takes the largest share earliest, with the longest gap before anything is visible. Off-plan spreads payments across milestones, which is where a buyer has most leverage to insist money follows verified progress. Ready is closest to a conventional purchase, with the balance at the deed. On the first two you also carry currency exposure across the whole build and pay holding costs on an asset earning nothing. Stage 05 has the cost stack; run it three times on the same unit, once per stage, before you choose.

Ready suits a buyer who needs to occupy or let within the year, or whose money cannot be tied up. Off-plan suits a two to three year horizon and a buyer prepared to do developer diligence properly. Pre-sale suits a small group: buyers who have already done business with that developer, or who can underwrite a balance sheet, and who are being paid a discount large enough to justify it. If you cannot say what that discount is, you are not in that group.

Stage 01 is the other half of the decision. An income buyer with a fixed target date should be particularly careful about pre-sale, because a season lost is a season that does not come back.