The slowdown in new residential construction in Tbilisi should continue through the end of 2026 to help restore balance in the housing market, according to Galt & Taggart. The investment bank says the recent decline in construction permits is a positive development after elevated supply created oversupply risks amid weaker demand.
In the first five months of 2026, the volume of residential construction permits issued in Tbilisi fell by 34.4% year-on-year, while the number of permits declined by 18%. In May alone, permits were issued for 23 residential projects with a combined residential area of 165,484 square meters.
G&T Senior Analyst Otar Tsukhishvili said permit issuance has been declining for eight consecutive months since October 2025, helping reduce the risk of excess supply. He noted that after a period of slow price growth, housing prices have accelerated alongside the moderation in new supply, with average monthly price growth reaching 0.6% in 2026.
The firm's latest update also shows that apartment sales in Tbilisi rose 11% year-on-year in May to 3,748 units. The average weighted price increased 6% to $1,412 per square meter, up from $1,331 a year earlier, indicating a gradual recovery in the market's supply-demand balance.
