Georgia Real Estate Returns: Advertised 15% vs Real 5-6%

Developers selling Georgian property love the number 12-15% annual yield. Strip out vacancy, platform fees, management costs and tax, and what is left is closer to 5-6% net². That gap is the single most important thing an investor needs to understand before wiring money to Tbilisi or Batumi: the market is real and growing, it just does not behave the way the brochures claim.

The 2026 numbers confirm the market is alive. Tbilisi sold 22,402 apartments in the first half of the year, up 18.7% year on year, with market volume around $1.8 billion⁴. Batumi logged 7,838 deals over the same period (+11.4%), with market value up 29% to $507 million⁴.

But demand structure differs sharply between the two cities, and that structure is the risk. In Tbilisi, foreigners account for roughly 10-14% of deals (14% in August, according to one 2026 reading³). In Batumi, the foreign buyer share hit 47% of apartment deals in June⁴, with some 2026 estimates putting it as high as 52%³ and other sources citing a share above 50%³. A city where half the buyers are non-residents can turn faster than almost any other market in the region.

Quick Answer

• Real net yield in Georgia after all costs lands around 5-6% a year, versus the 12-15% often advertised².

• Gross long-term rental yield: Tbilisi 7.5-8.5%, Batumi 8-10% annually⁵.

• 2026 primary-market prices: Tbilisi around $1,412/m2 (May 2026, +6.1% YoY), Batumi around $1,893/m2 (Q1 2026, +8.7% YoY)³. The resale market is cheaper: average apartment prices are $1,085/m2 in Tbilisi, $850/m2 in Batumi, $620/m2 in Kutaisi⁵.

• Taxes: a 5% rate applies to rental income under the relevant regime²; resale profit is tax-free after 2 years of ownership⁷; property tax ranges from 0% (household income under 40,000 GEL) to 1%⁷.

• Title registration: 50 GEL for 4 days, 100 GEL for 1 day, 200 GEL for same-day processing⁸.

• Biggest drawback: thin liquidity and oversupply risk in Batumi, where foreigners drive up to half of demand⁴.

Scenarios and Options

1. Tbilisi, long-term rental. A unit in Saburtalo or the outskirts of Vake. Rents in central districts run $12-18/m2 per month, on the periphery $6-9/m2⁵. Gross yield sits at 7.5-8.5%, net closer to 6%. Upside: demand is urban, not tourist-driven, so vacancy stays low year round. Downside: yield compressed by 0.5-1.0 percentage points over the past year because prices outran rents⁵.

2. Batumi, short-term rental. In season, a one-bedroom near the sea earns $40-120/night, off-season $25-45/night⁵. The math only works with high occupancy and professional management. The trade-off is blunt: four months feed the whole year, and management fees eat 15-25% of revenue. Meanwhile, Batumi deal volume in August 2026 fell 4.3% to 1,235 transactions, even as total value rose 2.9% to $81 million⁴. Prices are climbing while volume cools.

3. Kutaisi and the regions. Entry from $620/m2⁵, one-bedroom long-term rent at $200-300/month. Percentage yield is comparable to Tbilisi, but the absolute cash flow is small and exiting the asset can take months.

4. Gudauri and the mountain segment. Finished units run $1,200-2,000/m2, land for apart-hotels $30-70/m2⁵. The season here is winter-only and short, and dependence on weather and lift operations turns the asset into a bet on a single ski season.

Comparison Table

Main Risks and Mistakes

Believing the 12-15% headline. The real figure after costs is 5-6%². Model occupancy at 30-40% below peak for Batumi short-term rentals and always budget a management fee.

Low liquidity. Selling quickly in Georgia is hard: finding a buyer for a specific unit can take months¹. Do not invest money you may need back within a year.

Developer risk. The market is lightly regulated, so checking the developer and the legal status of the asset is mandatory². Ask for the construction permit issued under Government Decree No. 424 and an extract from the Public Registry.

Oversupply in Batumi. Half the demand is imported, so any drop in foreign interest hits prices almost immediately³. Diversify: one unit in the coastal city, one in the capital.

Accidental tax residency. Staying 183 days or more can make you a Georgian tax resident at a 20% personal income tax rate, even where double-taxation treaties apply⁶. Track your days.

The currency trap on mortgages. GEL-denominated loans run 14.3% a year, dollar loans 8.5% (June 2025)⁶. A dollar loan against lari-denominated income shifts all the currency risk onto you.

Selling before two years. The capital-gains exemption only applies after 2 years of ownership⁷. A one-year flip forfeits that benefit.

FAQ

What is the real return on Georgian real estate in 2026?

After costs, vacancy and tax, around 5-6% a year, despite advertised promises of 12-15%². The gross figure is higher: 7.5-8.5% in Tbilisi and 8-10% in Batumi⁵.

Is it better to buy in Tbilisi or Batumi?

Tbilisi offers stable urban demand and long-term rental income. Batumi offers higher nominal yield with seasonality and heavy reliance on foreign buyers (up to 47% of deals in June)⁴. Conservative investors tend to favor Tbilisi.

How much tax does a property owner pay in Georgia?

Rental income tax can be as low as 5% under the applicable declaration regime². Property tax ranges from 0% for household income under 40,000 GEL to 1% for income above 100,000 GEL⁷.

Do I pay tax when I sell an apartment?

After more than 2 years of ownership, resale profit is tax-free⁷. Earlier sales fall under general rules, so confirm specifics with a local lawyer before the deal.

How much does title registration cost and how long does it take?

50 GEL for 4 business days, 100 GEL for a one-day turnaround, 200 GEL for same-day processing⁸.

Are Georgian property prices rising?

Yes, moderately. Primary-market prices in Tbilisi reached about $1,412/m2 in May 2026 (+6.1% YoY), while Batumi hit about $1,893/m2 in Q1 2026 (+8.7% YoY)³.

What are current mortgage rates in Georgia?

According to the National Bank of Georgia, as of June 2025 rates stood at 14.3% a year in GEL and 8.5% in USD, with standard loan terms of 10-15 years⁶. Rates should be reconfirmed with a bank before any 2026 transaction.

Is it easy to sell property in Georgia?

No. Low liquidity is one of the market's biggest drawbacks: a quick exit at market price is rarely possible¹.

Source: Business Insider Polska

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This material was prepared with the help of artificial intelligence and checked by a person. Editorial responsibility: Housebook Investment LLC.