Galt & Taggart published a report on Real Estate - Batumi, Bakuriani, Gudauri. According to the document, in 2Q23, the number of apartments sold in Batumi reached 3,944, down 10.2% y/y and 10.0% q/q. This decrease was mainly attributed to sales on a primary market (-15.9% y/y), while sales on secondary market reduced slightly (-1.8% y/y).
Notably, there is a gradual shift of the real estate development from the central districts to Batumi surroundings (across Gonio/Kobuleti coastal line) due to scarce land resources left inside the city.
In 1H23, small (26-50 m2) and medium sized (51-80 m2) apartment sales accounted for 90.1% of total sales. Additionally, demand has been gradually shifting from budget/midscale price segments towards premium segment due to rising prices rather than change of consumer preferences.
In 2Q23, average price of apartments increased the most on a primary market to US$ 1,219 (+33.0% y/y), while secondary market posted a smaller increase (+15.7% y/y). Prices were up the most in Gonio-Kvariati (+67.7% y/y) and Inner areas (+45.2% y/y). In 2Q23, total market size of apartments sold in Batumi stood at US$ 209.5mn, down by 5.0% y/y and 7.5% q/q.
As of the document, real estate market in Batumi, Bakuriani, and Gudauri heavily relies on foreign buyers. In 2022, demand surged due to recovering tourism and migration, leading to higher prices driven also by increased construction costs and wages. In 2023, residential demand slowed down, but prices remained high.
Currently, there are 167 projects under development in Batumi, 18 in Bakuriani, and 9 in Gudauri. A steady supply and stable construction material prices are expected to stabilize price growth in these regions.
