05.Jul .2022 11:00

Residential Property Transactions In Batumi Improved By 32% YoY In Q1 2022 - TBC Capital

Residential Property Transactions In Batumi Improved By 32% YoY In Q1 2022 - TBC Capital
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TBC Capital published a report on Residential Real Estate. According to the report, the number of residential property transactions in Batumi improved by 32% YoY in Q1 2022. Periphery showed the highest increase in transactions (+48% YoY), while I line – the lowest (+11% YoY). This trend will continue in the future, as the supply is shifting from the I line to the broader coastal line (Chakvi, Makhinjauri, Gonio).

Periphery and Suburbs together accounted for 73% of total residential area approved for construction in 2021, while no permit was issued for construction in I line. The total residential area issued for construction in Batumi in 2021 was at the lowest level since 2013.

The average weighted sale prices declined by 3% YoY in Q1 2022. The highest decrease in prices was observed in I Line (-20% YoY), while Suburbs showed the biggest improvement (+9% YoY). This pattern is explained by the higher share of low-price properties in Q1 2022. Asking rent price and rental yield more than doubled in the beginning of 2022, reflecting an increased demand stemmed from migrants and gradual recovery in tourism.

"We expect the number of transactions and sale prices to increase in 2022 compared to the last year in Tbilisi and Batumi, supported by higher incomes, stable USD/GEL exchange rate, increased demand from non-residents and recovery in tourism. Rising construction costs will also push RRE prices up. However, together with the declining permit issuance it might have a negative impact on the market activity, especially in 2023 and 2024", - TBC Capital notes in the report.