Galt&Taggart published a report on Tbilisi Residential Real Estate. According to the document, in Sep-23, the number of apartments sold in Tbilisi stood at 3,314 units, down by 21.5% y/y. This drop is mostly explained by last year’s high base, as the highest number of the year's transactions took place in Sep-22. On a monthly basis, sales were down by 6.7%. Like in previous months, apartment sales on the primary market experienced the smallest decrease (-8.2% y/y), while sales on a secondary market (new and old projects) were down 29.0% y/y.
In Sep-23, sales decreased in nearly all districts of Tbilisi, with the exceptions being Didi Dighomi (+6.9% y/y) and Chugureti (+16.1% y/y). Importantly, decrease of sales in central districts (-32.4% y/y) was the most profound, while reductions in wide center and suburban districts were relatively smaller, -20.4 y/y and -7.6% y/y, respectively.
Other noteworthy features of the market remained unchanged, such as the continued dominance of medium-sized apartments (51-80 m2) and rising share of midscale/upscale segments, driven by rising prices.
In Sep-23, prices continued growth on a primary market accompanied by similar growth on the secondary market in new projects. Importantly, the highest annual increase in average asking prices from developers on a primary market was recorded in Didube (+42.0% y/y), driven by rising number of premium-class developments in the area.
In Sep-23, the overall market value of apartments sold in Tbilisi stood at USD235.7mn, down by 2.1% y/y. Notably, increase in the primary market size (+17.4% y/y) partly offset reduction in the secondary market size (-13.9% y/y).
In Sep-23, rents for apartments in Tbilisi remained stagnant, however still elevated in annual terms, up by 36.7% y/y in USD and 26.9% y/y in GEL. Notably, since the beginning of 2023, rents are down by 1.6% in USD and 2.7% in GEL.
The area of issued construction permits increased by 48.7% y/y in 8M23, continuation of upward trend observed since 2020. Notably, number of issued construction permits had a slower growth rate (+20.7% y/y), indicating a shift towards larger-scale projects in the pipeline.
