Why is Georgia becoming attractive to real estate investors?

Georgia in the real estate market

In recent years, Georgia has established itself as one of the leading players in the European residential and commercial real estate market. The mild climate, broad investment opportunities, and affordable housing prices are just part of the appeal that attracts investors from various countries.

Increase in the number of tourists

One of the significant factors contributing to the growing interest in real estate is the rapidly increasing number of tourists: in just five years, the number of visitors has risen from 2.8 to 6.4 million people.

Investments in the construction sector

Investments from both domestic and foreign companies in the hotel and residential sectors positively impact the quality of the constructed properties. This creates opportunities for purchasing real estate of various categories that can meet the needs of clients with different goals and budgets.

• Many people buy property not only for vacation but also for active rental purposes.
• The profitability of rental investments in the country is one of the highest in Europe.
• The barriers to entry in the market are quite low.

The construction industry ranks second in terms of foreign investment in Georgia.

Forecasts and trends in the real estate market

Experts suggest that positive trends in the Georgian real estate market will continue in 2018. According to statistical data, the average annual price growth for housing in Georgia reaches 8-10%, while commercial real estate may increase in price by 10-15%.

Experts' forecasts predict a steady increase in prices for residential properties in the coming years, remaining competitive compared to neighboring countries.

The stability of the Georgian market

Against the backdrop of financial difficulties in the real estate markets of neighboring countries, the Georgian market is showing steady growth, which suggests that there will continue to be a high interest in real estate in the country over the next 5-10 years.

Peak sales season

It's interesting that the peak in sales occurs during the spring and summer months, when potential buyers can combine their vacation with viewing available properties for purchase.

Attractive conditions for investors

Georgia attracts not only with its warm climate but also with its rich cultural traditions, mesmerizing natural landscapes, and unique cuisine. This rapidly developing country offers foreign investors favorable conditions for:

• Real estate purchases
• Business foundations
• Obtaining permanent residency

The process of acquiring real estate in Georgia is becoming increasingly hassle-free and accessible, making the country very attractive for many looking to invest their funds.

Among the key advantages of Georgia for foreign investors, several significant factors can be highlighted. Firstly, the country has a strategically advantageous geographical location, making it extremely attractive for business and commercial activities. Secondly, Georgia has established itself as one of the safest countries in Europe, thereby creating comfortable conditions for the living and working of its citizens.

Moreover, the workforce in the country is characterized by high competitiveness, which is another important aspect for foreign investors. Georgia offers numerous investment opportunities, which further enhances its attractiveness on the international stage. As for the infrastructure, it is well-developed here, significantly simplifying the process of doing business.

Natural resources and economic growth

Georgia's rich natural resources open up additional horizons for economic growth. The rapid growth of the tourism sector in the country also attracts foreign investments, which in turn leads to significant investments in the construction sector. The simple and accessible process of obtaining a residence permit is an added advantage for foreign citizens.

Tax advantages

It should be emphasized that there is no property tax in Georgia, which makes the market particularly attractive for buyers. The gradual increase in property prices, as well as the simplified system for registering property rights, are becoming important factors that stimulate the influx of foreign investments. It is also worth noting that international corporations are showing active interest in developing business in Georgia, and the liberal legislative framework somewhat expands the boundaries of opportunities.

Prospects for foreign investors

As an associated member of the European Union, Georgia is opening new opportunities for investors looking to invest their funds. The process of registering property rights takes no more than 15 minutes, which significantly simplifies the task for buyers.

New residential complexes

Currently, the most attractive segment in the real estate market is considered to be apartments in new buildings. Modern construction companies offer residential complexes, which creates numerous investment opportunities. Such comprehensive projects stand out:

• A fortunate location;
• Diversity of living spaces;
• High quality of service.

Multifamily complexes that can guarantee stable rental income are particularly interesting for investors.

Key regions for investment

Among the key regions for investment, Tbilisi and Batumi stand out, but it's also worth paying attention to Georgia's ski resorts, such as Gudauri and Bakuriani. Investments can be distributed in one city or across several, allowing for the creation of a portfolio of various real estate properties, thereby increasing overall profitability.

Popular real estate properties

Many clients are interested in apartments ranging from 40 to 60 square meters. A striking example of a successful investment project is the Alliance Palace in Batumi — a hotel complex with unique architecture, located just 80 meters from the beach on Batumi Boulevard. An international hotel chain, Marriott International, will operate in the designated area from the first to the fifth floor.

Advantages of buying

Acquiring real estate in such complexes not only highlights the owner's status but also opens up opportunities for profitable rentals with minimal management costs.

Cost of housing

It is also worth noting that the cost of housing in Georgia depends on the view from the apartment windows, which, in turn, is determined by the chosen floor.

The rise in apartment prices in Georgia

In Georgia, there is a trend of rising apartment prices with an increase in floor level. For example, studios measuring 30-35 square meters located on the fourth or sixth floor can cost from $35,000. On the upper levels, prices can exceed $50,000.

Average real estate prices

On average, the price of real estate in the country fluctuates around750 dollarsper square meter, but this figure can vary depending on a multitude of factors, such as location and the characteristics of the property itself. In prestigious areas of Tbilisi, for example, the cost per square meter can reach up to2500 dollarsIn the most upscale residential complexes, this threshold can rise to4500 dollarsfor a square.

Prices for new buildings

New buildings in advantageous locations often have prices starting from750 to 1500 dollarsper square meter. This depends on the quality and additional equipment of the apartments. One should not forget about seasonal changes in the market, as the likelihood of successfully renting accommodation in Georgia increases during the tourist season.

Rental properties in resort areas

In popular resort areas like Batumi, the price of real estate largely depends on the distance to the beach. The city is conditionally divided into zones:

• First line— these are coastal areas where both the property prices and rental rates are significantly higher compared to the second and third lines.

Modern apartments

Modern apartments are most often offered with finished interiors. If necessary, the developer can provide customization in equipment and furnishings, allowing new owners to actively start renting out their property right after receiving the keys, which can yield good profits.

Investment attractiveness of housing

When it comes to renting, investment property in Georgia offers great opportunities for stable income. Owners can:

• To handle the search for tenants ourselves,
• To negotiate,
• Control the payment and status of your properties.

Nevertheless, this can be quite a tiring process, and finding tenants while being outside of Georgia can be challenging. As a result, many companies offer property management and rental services for property owners.

Services of management companies

These management companies will not only help find good tenants and increase profitability, but they will also monitor the timeliness of utility payments and the condition of medical housing.

Financial aspects of renting

When it comes to profitability, managing rental properties independently can yield up to10%per year, while working with a management company will ensure a return within6-8%per year.

Taxation in Georgia

It is also worth paying attention to taxation. In Georgia, there is no tax on residential real estate, but if the owner rents out their apartment, they will have to pay taxes.5%from the total rental income received. Additionally, if a person uses their property for commercial purposes and their income exceeds40,000 dollarsIn a year, he must pay income tax in the range of0.2%to0.8%from my income.

Conclusion

Thanks to such a wide range of opportunities, Georgia seems to be an attractive and dynamically developing market for real estate investments.

Conclusion

In conclusion, I would like to emphasize the important aspects regarding real estate investments in Georgia. The country, with its unique climate, attractive housing prices, and steady economic growth, is becoming an essential destination for those seeking not only relaxation but also profitable investments. In recent years, we have witnessed rapid development in the real estate market, which has provided foreign investors with excellent opportunities for income generation, especially relevant in the context of instability in neighboring markets.

One of the main factors contributing to the growing interest in the Georgian market has been the increase in the number of tourists, which in turn creates demand for rental housing. Witnessing this growth, one can confidently assert that the potential for real estate price increases in Georgia remains, making the market not only interesting but also safe for investments.

Advantages of Georgia for foreign investors

• Transparency of transactions:easy process of buying real estate.
• Processing speed:the efficiency of document processing.
• Investment Potential:stable growth in housing prices.

Equally important is the fact that Georgian legislation provides foreign investors with conditions that facilitate the quick and easy purchase of real estate. The efficiency of document processing and the transparency of transactions serve as additional advantages for foreign buyers. Georgia attracts not only individual investors but also large international companies, which positively transforms the market.

Prospects of the real estate market

I am confident that Georgia will continue to maintain its position on the map of European investment destinations, and anyone who decides to invest their funds in this country will not only be able to enjoy its beauty but also reap financial benefits.

Investments in residential real estate

Investing in new housing, especially in multi-apartment residential complexes in Tbilisi and Batumi, promises not only decent returns but also a high standard of living and comfortable living conditions. Thus, Georgia is not just a country with stunning nature and a rich historical heritage; it is an important player in the real estate market, ready to offer unique opportunities for every investor.