Georgia's Primary Housing Market in 2026

TL;DR

• Sales on Georgia's primary market in 2026 are NOT falling—they are growing, but moderately and unevenly: according to official data from the Public Registry (NAPR), processed by Colliers Georgia, 22,402 apartments were sold in Tbilisi in January–June 2026 (+18.7% year-on-year), with new construction sales up 21.8%; in Batumi for the first half of the year—7,838 apartments (+11.4%). Buyers exist, but the market is "normalizing" after the boom of 2022–2023 and is highly dependent on foreign demand and geopolitics.
• New construction prices are rising within single digits: in Tbilisi, primary market in May 2026—$1,412/m² (+6.1% y/y), in Batumi in Q1 2026—$1,893/m² (+8.7% y/y). Forecasts for 2026: Tbilisi +3–5%, Batumi +4–6%. Analysts do not expect price declines.
• The main risk is oversupply, especially in Batumi: by the end of 2025, unsold inventory in projects of surveyed developers grew by 13.9% y/y to ~12,400 apartments, and 2026 will be a record year for housing delivery (~35 thousand apartments in Tbilisi and up to 18 thousand in Batumi—compared to 13 thousand in Batumi in 2025 and only 2 thousand in 2020). Operational surveys of developers show much more modest primary sales dynamics than registry data.

Key Findings

1. Sales are growing according to registry data, but developer surveys paint a more restrained picture. In Tbilisi in May 2026, 3,748 transactions were registered (+11.1% y/y), of which primary (NAPR)—1,824 (+9.7%). However, an operational survey of developers by Galt & Taggart (covering ~50% of primary projects) showed primary sales growth of only 2.5% y/y, with total sold area declining—buyers are purchasing smaller apartments. Registry data are inflated due to transaction registration delays.

2. 2025 was a year of normalization, not decline. According to NAPR/TBC Capital, in Georgia in 2025, 78,500 apartments were sold (+5.94% y/y). Secondary—63% of transactions (+7.42%), primary—37% (+3.53%). Tbilisi: 42,388 apartments (+4.31%). Batumi: 17,478 (+15.02%). The weak start of 2025 (political instability) was replaced by demand recovery in the second half of the year.

3. Batumi's primary market is vulnerable due to excess supply. Sales are growing (Q1 2026: 4,049 apartments, +15.8%), but remain significantly below the peak of 2022–2023, and unsold inventory is rising. Primary prices ($1,893/m²) are growing faster than secondary, the gap is widening, and rental yields are falling: according to Galt & Taggart, gross yield in Batumi decreased from 10% in 2023 to 7.4% in 2025, with further decline forecast to 5.1–3.4% (net yield on apartments—only 3–4%).

4. Buyers exist, and they are primarily local. In Tbilisi, Georgian citizens make ~77% of primary transactions (Israel ~10%, Russia ~3%); the share of foreigners in H1 2026 is about 10%. In Batumi, the opposite: foreigners—52% of transactions in 2025, up to 63% in Q1 2026 (EU 13%, Israel 13%, Ukraine+Russia+Belarus ~11%).

5. Credit is expensive, but mortgages are growing; developers actively offer installment plans. The average mortgage rate in lari is 12.14% (February 2026, down from 13.31% a year earlier), in foreign currency ~8%. New mortgages issued in 2025 amounted to 9.6 billion lari (+9.1%). Most primary transactions go through interest-free internal developer installments (down payment from 10%).

6. Background: strong economy, but political and geopolitical risks. GDP grew by 7.5% in 2025 (2026 forecast—5.0%), the lari is stable (~2.62–2.64/$). But the suspension of European integration (December 2024), protests, the "foreign agents" law, tightening migration rules, and raising the property investment threshold for residency from $100 thousand to $150 thousand (from March 1, 2026) are pressuring foreign demand.

Details

1. Transaction dynamics in 2026

National context. Georgia's market has been growing since 2021; in 2024, the housing market volume reached a historical maximum of $4.3 billion (+9% to 2023). The record for the number of transactions was set in 2022 (about 79 thousand) on the wave of mass migration of Russians. In 2025, 78,500 apartments were sold (+5.94% y/y)—the market returned to growth after the cooling of 2023–2024, but without frenzy.

Tbilisi, monthly (NAPR data via Galt & Taggart):

• January 2026: 2,964 transactions; primary (NAPR) 1,614 (+4.0%), developer survey +21.8%; secondary 1,350 (−3.2%).
• February 2026: 3,822 transactions (+15% y/y); primary 1,958 (+11.2%), developer survey +26.6%; secondary 1,864 (+19.2%).
• April 2026: 3,641 transactions; secondary 1,857 (+17.2%), primary 1,784 (+4.6%), developer survey +64%.
• May 2026: 3,748 transactions (+11.1% y/y); secondary 1,924 (+12.4%), primary 1,824 (+9.7% per NAPR, but +2.5% per developer survey).
• June 2026 (Colliers): ~4,484 transactions (+34.7% y/y), market volume $387 million (+53.9%).

Tbilisi, half-year (Colliers Georgia): January–June 2026—22,402 apartments (+18.7% y/y), market volume $1.8 billion (+33.2%). New construction +21.8%, secondary +22.1%. Weighted average primary price across the city +11.7% (H1/H1).

Batumi:

• Q1 2026: 4,049 apartments (+15.8% y/y); secondary +10.1%, primary +21.1% (NAPR), developer survey +70.6%.
• May 2026: 1,324 apartments (+2.5% y/y), $87 million (+22.2%).
• June 2026: 1,468 apartments (+8.2% y/y), ~$100 million (+28.2%); new construction sales +11.6%, secondary −26.4%.
• H1 2026: 7,838 apartments (+11.4% y/y), turnover $507 million (+29%).

Conclusion on sales: primary market is not falling in any major city according to registry data. However, the discrepancy between registry data (which are inflated due to registration delays) and operational developer surveys (May in Tbilisi: +2.5% instead of +9.7%) indicates that the real primary dynamics are more modest than headline figures.

2. New construction prices

Tbilisi. Primary: $1,385/m² (January) → $1,398 (February) → $1,408 (April) → $1,412/m² (May, +6.1% y/y). Growth is moderate (~0.3–0.9% per month), indicating a balance of supply and demand. By district (Geostat, Q4 2025, median apartment prices): Mtatsminda $2,497/m², Vake $2,176/m², Chugureti $1,613/m², Saburtalo $1,598/m², Samgori $1,315/m². Price growth forecast for Tbilisi in 2026: Galt & Taggart—single digits, TBC Capital—~3.2%, expert estimates 3–5%.

Batumi. Average primary price "turnkey" in 2025—$1,865/m² (+9.4% y/y); in Q1 2026—$1,893/m² (+8.7%), secondary $1,479 (+7.8%). The most expensive submarket is Old Batumi ($3,028/m²). Galt & Taggart forecast for 2026: slowdown in primary growth to 4–6%. Colliers ($1,500/m² average for both cities) does not expect price declines in 2026.

3. Supply and oversupply risk

Construction permits are declining—a signal of normalization. In Tbilisi in 2025, 208 permits were issued (−4.2%), permitted residential area −10.73% to 1.734 million m². By May 2026, the area of permits has been declining for the eighth consecutive month (May: −18.4% y/y; over 5 months −34.4%). Nevertheless, issuance remains ~32% above the "healthy" level of 2015–2022.

2026—a record year for housing delivery. Galt & Taggart forecasts delivery of ~35 thousand apartments in Tbilisi and up to 18 thousand in Batumi—a historical maximum. For Batumi, this is a sharp jump: delivery grew from 2,000 apartments in 2020 to 13,000 in 2025, and the 2026 peak will reach up to 18,000 units. The reason is the simultaneous completion of projects launched during the period of frenzied demand. This intensifies competition and pressures prices and rental rates.

Batumi—the epicenter of oversupply risk. According to Galt & Taggart, by the end of 2025, unsold inventory in projects of surveyed developers grew by 13.9% y/y to ~12,400 apartments, which "indicates an elevated risk of oversupply." Analysts directly warn that primary price growth "outpaces demand" and maintaining current rates will be difficult. Main demand has shifted to the New Boulevard area.

4. Demand and buyers

Who buys. In Tbilisi, the driver is local end buyers (~77% of primary transactions; according to Colliers estimate—up to 90% of all transactions). The largest foreign groups in Tbilisi: Israel (~10%), Russia (~3%). In Batumi, the market is much more "international": foreigners—52% in 2025 and up to 63% in Q1 2026; top groups—EU (13%), Israel (13%), plus Ukraine/Russia/Belarus (~11% combined) and Turkey.

Mortgages and installments. Mortgage rate in lari—12.14% (February 2026, down from 13.31% a year earlier), in foreign currency ~8.01%. National Bank President Natia Turnava at a financial committee meeting (May 2026) noted a decrease in the average mortgage rate from 13.4% (January 2025) to 11.9% (March 2026), and for business loans—from 14.4% to 12.8%, attributing this to lower credit risks and increased confidence in the lari. New mortgages issued in 2025 amounted to 9.6 billion lari (+9.1%), outstanding balance—24.2 billion lari (+16.2%). Due to high rates and strict bank requirements (down payment from 20%), most new construction buyers use interest-free internal developer installments (down payment from 10%, schedule until building completion)—this has become the main sales promotion tool.

Regulatory changes. From March 1, 2026, the property investment threshold for residency was raised from $100 thousand to $150 thousand—this is the third increase in the program's history and the first since 2019 (a 50% increase, per June 2025 amendments). The threshold is calculated based on market valuation (not the contract price) and can be met by the sum of several properties. The change shifts foreign demand to a more expensive segment. Earlier in 2026, the regulator tightened requirements for developer loans (LTV and provisioning) after an IMF review that noted growing bank exposure to real estate.

5. Market sentiment

Sentiment in 2026 is cautiously optimistic, but with a clear understanding that the "golden" years of 2022–2023 are behind. Galt & Taggart analysts describe the market as "normalizing" with oversupply risks "on the radar." Leo Chikhava (Colliers Georgia) is more optimistic: he stated that no price decline is expected in 2026 and there will be no oversupply, as fewer new bank-financed projects balance the entry of 2022 projects into the market.

The contrast with the end of 2024 is striking: then the Georgian National Real Estate Association (GNARE, ~110 members, of which 30% developers and 70% brokers) reported that in December 2024 transactions were "reduced to a minimum" and "suspended—everyone is waiting for developments" amid protests. In 2026, there is no such freeze—buyers have returned. But market participants acknowledge that the market has become "selective": strong liquid properties continue to sell and appreciate, while weak projects and an oversupply of studios (especially in Batumi) create pressure.

6. Influencing factors

Economy. GDP grew by 7.5% in 2025 (according to Geostat's rapid estimate of January 30, 2026: 9.9% in Q1, 7.4% in Q2, 6.4% in Q3, 6.8% in Q4; nominal GDP 104.6 billion lari / $38.1 billion, +12.4%). Growth, according to the World Bank, is driven mainly by consumption: domestic private consumption +8.2%, real wages +11.5%. Forecast for 2026: the World Bank expects a slowdown to 5.0% "amid weaker external conditions and softer domestic demand"; IMF—5.3%. Inflation accelerated from 4.3% (March) to 5.7–5.9% (April–May 2026) due to rising energy prices. The lari is stable (~2.62–2.64/$, pegged to the dollar). Fitch (November 2025) and S&P (February 2026) affirmed the "BB" rating with a stable outlook.

National Bank rate. According to Global Property Guide, the rate was held at 8.0% since May 2024. However, according to Trading Economics, in April 2026 the National Bank raised the rate by 25 b.p. to 8.25% for the first time since March 2022 due to the inflation shock (May inflation 5.7% against a 3% target) and held it in June 2026. (I explicitly note the discrepancy between sources.)

Tourism. International tourism revenues in H1 2026—$1.93 billion (−2% y/y), number of visits 2.734 million (−2.7%) due to a decline in Q2. Revenues from Russian tourists fell by ~25% y/y, while those from EU citizens grew by ~21% (to $335.6 million—the largest group). Russia remains the largest source of visitors (25.1% in Q2).

Politics and relocants. The suspension of EU accession talks (December 2024), the "foreign agents" law, prolonged protests in Tbilisi, arrests of activists, and tightening of migration legislation (from March 2026—mandatory work permits for foreigners, fines for overstaying increased from 180 to 1,000 lari) are causing an outflow of some relocants. This is a key medium-term risk for the segment oriented toward foreign demand.

Recommendations

For the end-user buyer (residence):

• In Tbilisi, the market is balanced—you can buy, but there is no need to rush: prices are growing moderately (3–6% per year), no risk of sharp growth. Prefer liquid districts (Vake, Saburtalo, Vera, Mtatsminda) and ready/nearly ready projects from reliable developers.
• Use the developer's internal interest-free installment plan instead of a mortgage at ~12% in lari if you do not have access to a foreign currency loan.

For the investor:

• Batumi, mass segment by the sea—increased caution. Growing unsold inventory (~12,400 apartments), record delivery in 2026 (up to 18 thousand apartments), and falling rental yields (7.4% gross, 3–4% net) mean a risk of price stagnation and difficulties with resale. Avoid typical studios in peripheral projects.
• Focus on managed apartment hotels/branded residences with real occupancy, not "first-line apartments" with promised rental guarantees (read the fine print).
• If residency is part of the goal, consider the new threshold of $150 thousand from March 1, 2026.

Triggers for strategy revision (benchmarks):

• If Galt & Taggart's operational developer surveys show negative primary sales dynamics for 2+ consecutive months—a signal of real cooling (unlike "noisy" registry data).
• If unsold inventory in Batumi exceeds ~15 thousand apartments or developers start mass discounts >10%—a sign of price correction.
• Sharp devaluation of the lari, escalation of protests, or new restrictions for foreigners—reasons to postpone purchasing an investment property.

Caveats

• Registry data (NAPR) overstate primary sales due to transaction registration delays; operational developer surveys are a more accurate but selective (~50% of projects) indicator. The discrepancy is significant (May in Tbilisi: +9.7% per NAPR vs +2.5% per survey).
• Source methodologies differ. Galt & Taggart defines "primary" as direct developer sales (~37–50% of the market), while TBC Capital classifies only ~14% of transactions as "new" (in March 2026 "new" apartments: 564 units, −3% y/y). Figures from different companies are not directly comparable.
• ~12,400 unsold apartments is Batumi, not Tbilisi. There is no separate public figure for unsold inventory in Tbilisi in available sources; for Tbilisi, Galt & Taggart only states "oversupply risk on the radar."
• Conflict of interest: Galt & Taggart (part of Bank of Georgia group) and TBC Capital (TBC Bank) are market participants. Colliers' estimates (Chikhava) are more optimistic ("there will be no oversupply") and diverge from Galt & Taggart's more cautious stance.
• Discrepancy in the National Bank rate between sources (8.0% vs 8.25% since April 2026) is noted above.
• At the time of report preparation (data as of end of July 2026), publicly available monthly reports from Galt & Taggart and TBC Capital cover data no later than May 2026 (plus Colliers data for June); some June/July figures are from secondary retellings, not original PDFs.