Real Estate Buying Guide for Foreigners in Brunei: The Complete Handbook

Published on October 5, 2025 and written by Cyril Jarnias

Brunei, a small sultanate located on the island of Borneo, is increasingly attracting foreign investors due to its political and economic stability. Although the real estate market there is relatively limited, it offers interesting opportunities for those who know how to navigate its particularities. This article will guide you through the intricacies of purchasing property in Brunei as a foreigner, addressing the legal, tax, and practical aspects of this process.

Legal Framework: What You Need to Know Before Investing

In Brunei, the legal framework governing property acquisition by foreigners is relatively strict. The country’s land law, known as the “Land Code,” imposes significant restrictions on foreign ownership. However, these restrictions do not mean that investment is impossible, but rather that it requires a thorough understanding of the rules in force.

The fundamental principle to remember is that foreigners cannot own land outright in Brunei. Land ownership is generally reserved for Bruneian citizens. However, there are alternatives for foreign investors:

• Long-term leases: Foreigners can acquire leasehold rights on properties for terms of up to 99 years.
• Strata title ownership: In certain designated real estate developments, foreigners can purchase apartments or units under strata title.
• Special economic zones: Certain areas, such as the Anggerek Desa Technology Park, offer more flexible conditions for foreign investment.

It is crucial to note that any real estate transaction involving a foreigner must obtain prior approval from the Bruneian government. This approval is generally granted on a case-by-case basis, taking into account factors such as the nature of the investment and its potential benefits for the local economy.

International Taxation: Understanding Your Obligations

Taxation is a crucial aspect of any foreign real estate investment, and Brunei is no exception. The country is known for its advantageous tax regime, which can make it particularly attractive to international investors. Here are the main points to know:

• Income tax: Brunei does not impose personal income tax. This means that rental income generated by your real estate investment will not be taxed locally.
• Property tax: There is an annual property tax, but its rate is relatively low compared to other jurisdictions. It is generally calculated on the annual rental value of the property.
• Transfer duties: When purchasing a property, stamp duties are applicable. The rate varies depending on the transaction value but generally remains moderate.
• Capital gains: There is no capital gains tax in Brunei, which can be a significant advantage for long-term investors.

However, it is crucial to consider the tax laws of your home country. Even though Brunei offers a favorable tax environment, you might be subject to tax obligations in your country of residence. It is therefore recommended to consult an international tax expert to optimize your overall tax situation.

Furthermore, Brunei has signed tax treaties with several countries to avoid double taxation. These agreements can significantly impact your tax situation and must be considered in your investment strategy.

Administrative Process: Documents and Procedures to Finalize Your Purchase

Acquiring property in Brunei as a foreigner requires careful preparation and the compilation of a solid file. The procedure may seem complex, but a good understanding of the steps and required documents will greatly facilitate the process. Here are the key elements to consider:

Essential Documents

To begin the purchase process, you will generally need to provide:

• A copy of your valid passport
• Proof of residence (if applicable)
• Bank statements or other proof of financial capacity
• A business plan or justification for the investment (for purchases for commercial purposes)
• Company identification documents (for purchases by legal entities)

Administrative Procedures

The acquisition process generally unfolds as follows:

1. Obtaining preliminary approval: Before any transaction, you must obtain authorization from the Bruneian government. This application is made to the Ministry of Development.

2. Due diligence: Once approval is obtained, it is crucial to conduct a thorough verification of the property and its title. This may involve the intervention of a local lawyer.

3. Sales contract: The drafting and signing of a formal sales contract are necessary. This document must be prepared in compliance with local laws.

4. Payment of duties and taxes: Stamp duties and other administrative fees must be paid before finalizing the transaction.

5. Registration: The transaction must be registered with the competent authorities to be legally recognized.

It is highly recommended to enlist the services of a local lawyer specializing in real estate law to guide you throughout this process. Their expertise can prove invaluable in navigating the subtleties of the Bruneian legal system and avoiding potential pitfalls.

Opportunities for Foreign Investors: What Are Your Options?

Despite the apparent restrictions, the Bruneian real estate market offers interesting opportunities for savvy foreign investors. The key lies in understanding the available options and the ability to identify promising niches. Here is an overview of the possibilities available to you:

Long-Term Leases

Although direct land ownership is limited, long-term leases constitute a viable alternative. These leases, which can extend up to 99 years, offer sufficient security for many investors. They are particularly common in commercial and industrial areas.

Strata Title Properties

Certain residential developments, particularly in the capital Bandar Seri Begawan, allow foreigners to purchase apartments or units under strata title. These properties are often located in modern complexes offering high-end amenities.

Special Economic Zones

The Bruneian government has designated certain areas to encourage foreign investment. In these zones, ownership rules may be more flexible. The Anggerek Desa Technology Park, for example, offers interesting opportunities for investors in the technology sector.

Partnerships with Locals

A common strategy involves forming partnerships or joint ventures with Bruneian citizens. This approach can open doors to broader investment opportunities while respecting legal restrictions.

Commercial Investments

Investments in commercial real estate, particularly in the tourism and hospitality sectors, may receive more favorable treatment. The government is actively seeking to diversify the economy beyond the oil and gas sector.

It is important to note that each type of investment may be subject to specific rules. For example, certain sectors may require a minimum percentage of local participation. Thorough due diligence and local legal advice are essential to navigate these complexities.

Furthermore, the Bruneian real estate market is relatively small and may lack liquidity compared to more developed markets. Investors should therefore adopt a long-term perspective and be prepared to face potential challenges in terms of resale or investment exit.

Conclusion: A Niche Market with Potential to Explore

Real estate investment in Brunei for foreigners certainly presents challenges, but also unique opportunities. The strict regulatory framework is offset by an advantageous tax environment and enviable political and economic stability in the region. To succeed in this market, it is essential to:

• Thoroughly understand the legal restrictions and available options
• Surround yourself with competent local professionals (lawyers, real estate agents)
• Adopt a long-term perspective
• Stay informed about regulatory and economic developments

Brunei, with its desire to diversify its economy and attract foreign investment, could see its real estate market evolve in the coming years. Pioneer investors who can navigate this unique context may well position themselves advantageously for the future.