"Real Estate Prices Won’t Increase Much From 2025" - Leo Chikava

The demand for real estate in Georgia remains high. In September, 3,545 apartments were sold in Tbilisi, marking a 12% increase compared to the same period last year, according to Leo Chikava, Head of Research and Data Services at Colliers Georgia. The market size has grown by 25%, reaching $247 million.

In the latest Colliers Georgia report, the Batumi real estate market also saw growth. In September 2024, residential apartment transactions in Batumi increased by 19% to 1,401 units, with a total market size of $70 million.

Chikava noted that the third quarter of 2024 also showed positive growth. Compared to the same period last year, residential apartment transactions in Tbilisi rose by 3%, and in Batumi by 11%. However, the overall number of transactions for the first nine months of 2024 has decreased. Sales of new apartments in both Tbilisi and Batumi have increased, while sales of older apartments have declined.

Regarding price trends, Chikava stated that the weighted average price of residential properties in Georgia in 2024 is currently $1,063 per square meter. In Tbilisi, both new and old apartments have seen price increases. In September, the average price of newly built apartments rose by 8% in suburban areas and 10% in the city center. Similarly, old apartments also saw price increases. However, in Batumi, only newly built apartments have become more expensive, while prices for older properties have decreased. The weighted average price of new apartments in Batumi increased by 8%, reaching $1,126 per square meter, while old apartments saw a 6% drop, averaging $988 per square meter.

Looking ahead, Chikava predicts that due to the increased supply, real estate prices will stabilize in 2025, with only modest increases or possibly even a slight decrease.

Real estate prices are influenced by various factors, including the construction cost index. According to Geostat data, construction prices in Georgia increased by nearly 8% annually as of August 2024, driven largely by a 30% rise in average wages in the construction sector and higher costs for construction materials.