Tbilisi residential property: where to find the most expensive properties
The price of residential property in Tbilisi continues to rise. This is the conclusion reached by the National Bureau of Statistics using the RPPI price index. The latter measures the dynamics of the housing sector.
According to official data, the RPPI rose by almost 5% in the second quarter of 2024 compared to the previous three months. On an annualised basis, the increase was nearly 15% compared to the same period in 2023. Compared with prices in 2020, the growth was more than 48%.
The situation on the new housing market in the capital of Georgia forms the basis of the RPPI index:
1. The price of apartments rose by almost 5% over the quarter and by more than 14% over the year.
2. The cost of houses increased by 4.6% over the quarter and by 16.8% over the year.
Experts note that the increase in residential property prices in Tbilisi has been uneven. The dynamics vary from district to district:
1. The Mtatsminda district has become the leader in terms of house price growth, where a square metre of new housing costs about USD 2,112.
2. In second place is the Vake district, where the cost per square metre is USD 1932.
3. The Saburtalo district is third in terms of price growth, with a square metre of new housing costing USD 1486.
As for affordable locations, an apartment in Isani costs USD 1270 per square metre. In Gldani, prices are even lower — USD 1261 per square metre. The cheapest property in the capital can be bought in Samgori for USD 1190 per square metre.
Mtatsminda is also the leader in the detached house segment. The cost here is USD 1628 per square metre. In Diduba, prices are slightly lower — USD 1319 per square metre. In third place is Vake, where the cost per square metre is USD 1243. The cheapest houses in Tbilisi are in Nadzaladevi — USD899 per square metre. This is followed by Samgori and Gldani, where the cost varies between USD 843 and USD 874 per square metre.
Yield on the Georgian property market
Galt & Taggart estimate that the average annual return on property in the capital is 10.3%. In Batumi, this figure is slightly higher, at 10.8%. Analysts point out that these figures are higher than in many other countries. However, investors should bear in mind that the residential sector is less profitable than the hotel sector. The hotel business is mainly focused on generating rental income. Investing in residential property, for example, often involves a number of additional costs. These include repairs, maintenance and efforts to attract tenants. In addition, flats and houses can sit empty without tenants, which also affects overall profitability.
The hotel sector is an excellent option for regular profits. Georgia offers favourable conditions in this respect. A large number of management companies provide their services. They take care of finding tenants, operations and all organisational issues.