Getting to Know Apartment Ownership Letter and How to Manage It
surat kepemilikan apartemen

Getting to Know Apartment Ownership Letter and How to Manage It

Owning an apartment is a popular housing choice nowadays. However, before purchasing one, it's important to understand the differences between the Strata Title Certificate for Apartment Units (SHMSRS) and the Building Ownership Certificate (SKGB).

SHMSRS serves as proof of ownership of an apartment unit, which is part of a multi-story building. This certificate grants full rights to the owner over the apartment unit, including the right to use, sell, and inherit the unit.

On the other hand, SKGB represents ownership of the entire building, including the land it sits on. This certificate is typically held by the developer or apartment management.

What are the differences between these two apartment certificates? Let's find out!

Strata Title Certificate for Apartment Units (SHMSRS) vs Building Ownership Certificate (SKGB): Which is Better?

Buying an apartment is an attractive option for many people, especially in big cities. However, before making a purchase, it's crucial to understand the types of apartment ownership certificates available, as this can affect your rights and obligations as an owner.

Two common types of apartment ownership certificates in Indonesia are:

  • Strata Title Certificate for Apartment Units (SHMSRS): Grants full rights over the apartment unit and joint rights over the land and common property (such as foundations, walls, lifts, and other facilities).
  • Building Ownership Certificate (SKGB): Grants ownership rights over the apartment unit, but the land beneath it is managed under a Land Management Right (HPL) owned by the developer.

What is SHMSRS?

SHMSRS stands for Strata Title Certificate for Apartment Units. This certificate grants full rights over the apartment unit to the holder.

Benefits of SHMSRS:

Full rights over the unit: Owners have full rights to use, sell, and inherit their apartment units.
More affordable: Apartments with SHMSRS are generally cheaper than landed houses with Freehold Titles (SHM).
Strategic locations: Apartments with SHMSRS are often found in strategic locations in the heart of the city.

Disadvantages of SHMSRS:

Joint rights over land and common property: Owners of apartment units have joint rights over the land and common property such as foundations, walls, electrical networks, lifts, and other facilities.
Ownership period: The ownership of apartment units has a maximum period of 50 years (30 years + 20 years extension).

What is SKGB?

SKGB stands for Building Ownership Certificate. This certificate serves as evidence of ownership over strata units on state/government-owned land.

Advantages of SKGB:

Easy licensing process: For developers, obtaining permits for apartments with SKGB is easier.
Lower cost: Apartments with SKGB are generally cheaper than apartments with SHMSRS.

Disadvantages of SKGB:

Risiko investasi tinggi: Pemilik apartemen dengan SKGB dapat kehilangan aset jika developer tidak memberikan rekomendasi perpanjangan hak pengelolaan lahan.
Nilai jual rendah: Nilai jual apartemen dengan SKGB umumnya lebih rendah daripada apartemen dengan SHMSRS.

Which one is better?

Generally, SHMSRS is recommended as it provides stronger rights and lower investment risks. However, SKGB may be an option for buyers with limited budgets.

Can Apartments Have Freehold Titles (SHM)?

Many people wonder if apartments can have Freehold Titles (SHM). The answer is no.

Although apartments can have ownership certificates equivalent to SHM, such as SHMSRS (Strata Title Certificate for Apartment Units), apartment developers cannot obtain SHM for the land they build on.

This is because Law Number 5 of 1960 concerning Basic Agrarian Regulations Article 21 paragraphs (1) and (2) limit land ownership rights only to Indonesian citizens and social entities.

This provision is reinforced by Government Regulation Number 38 of 1963 concerning the Designation of Legal Entities that Can Have Land Ownership Rights.

Therefore, although apartments cannot have SHM, apartment buyers still have valid ownership certificates recognized by the state, such as SHMSRS.

Procedure for Obtaining SHMSRS Apartment Ownership Certificate

The process of obtaining SHMSRS is different from regular SHM. It is the developer's responsibility to handle it, not the apartment owner. Here are the steps:

1. Separation of Ownership

The developer separates the ownership of the apartments, including common and individual parts. This separation is documented in a deed complete with pictures, descriptions, and ownership boundaries.

2. Deed Validation

The developer must submit the deed to the second-level Local Government (city/district) for validation.

3.Registration with the Land Office

Once the deed is validated, the developer must register it with the local land office, along with the land ownership certificate, occupancy permit, and other documents.

4. Issuance of SHMSRS

Once the deed is registered and the land book is completed, the SHMSRS can be issued. The SHMSRS is created by making copies of the land book.

Documents Required by the Developer:

  • Application form (filled out and signed)
  • Power of attorney (if the application is submitted by proxy)
  • Copy of ID card and family card
  • Joint land ownership certificate (original)
  • Apartment development proposal
  • Occupancy permit
  • Registered separation deed

Time and Cost of Processing

The processing time for SHMSRS varies depending on the size of the apartment land. The cost of certificate issuance also varies.

  • Land under 2,000 square meters: about 38 days
  • Land from 2,000 square meters to 15 hectares: about 57 days

SHMSRS is crucial to ensure ownership rights over apartments and avoid disputes in the future. Therefore, choose apartments from reputable developers.

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Interest rate is 4.7% fixed for the first 3 years, after that, the rate will move to a floating rate (currently 11%)

Requirements

  • Permanent employee/self-employed for at least 1 year in the same company/total 2 years of work
  • Professional/Businessman working for at least 2 years in the same field
  • At least 18 years old or married

General Personal Requirements

  • Photocopy of husband’s / wife’s ID card (if married)
  • Photocopy of Family Card
  • Copy of Marriage Certificate (if married)
  • Photocopy of Tax ID Number of Applicant
  • Salary Slip / Certificate of Income for the last 1 month original
  • Photocopy of 3 months bank statements
  • Developer’s House Booking Letter / Broker’s Cover Letter

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