Galt&Taggart published update on Tbilisi Residential Real Estate. According to the document, In Feb-24, the number of sold apartments in Tbilisi stood at 3,444 units, up 0.9% y/y, after 6.3% y/y growth in Jan-24. This growth is solely attributed to increased transactions on the primary market (+11.8% y/y), while sales on the secondary market decreased by 7.5% y/y. Continued decline on the secondary market suggests the end of a speculative buy-to-rent period in the real estate market, as rental rates and yields are gradually moving back to normal levels.
In Feb-24, almost half of registered transactions (49.0% of total) were recorded in Didi Dighomi (+17.0% y/y), Saburtalo (-8.2% y/y) and Samgori (+11.5% y/y) districts. Notably, transactions decreased in central districts of Tbilisi, Vake (-11.2% y/y) and Mtatsminda (-35.9% y/y). Other noteworthy features of the market remained unchanged, such as the dominance of medium-sized apartments (51-80 m2 ), due to affordability and the ease of renting, and falling share of sold apartments in the budget segment ($501-800/m2 ), driven by rising prices.
Prices
In Feb-24, real estate prices on the primary market continued to grow (+0.8% m/m and +16.5% y/y), while a reduction was recorded on the secondary market (- 4.1% and -2.2% m/m, for new and old projects).
Market size
In Feb-24, the total market value of apartments sold in Tbilisi stood at US$ 258.8mn, up by 4.9% y/y. This growth was solely attributed to the primary market (+22.8% y/y), driven by combination of increased transactions and prices.
Rent
In Feb-24, price for renting an average apartment (50- 60 m2 ) in Tbilisi stood at US$ 9.9 per m2 (-4.8% m/m). Notably, rents are down on a monthly basis in every district in Tbilisi. Galt&Taggart expects gradual stabilization in rents to continue during 2024.
Construction permits
In 2M24, 29 new permits were issued for residential projects, with the total living area of 200,445 m2 (+5.3% y/y). In 2M24, 24% of total permitted living area was in Didi Dighomi, followed by Saburtalo (21%) and Vashlijvari (14%).
