Georgia is no longer as sleepy a country as it once was. It is becoming a tourist destination that is not just acceptable but even sought after. Even moreso, it is an evolving destination on the world tourism map, so it is also becoming a very interesting destination for real estate investors. What makes real estate in Georgia in such demand today? Here are all the reasons you should know about.
Cities such as Batumi, the bustling port city, or Tbilisi, the capital and economic hub of the country, are currently witnessing an incredible economic boom. In fact, for more than a decade, the country has been on the direct path to closing the gap between it and the richer Western countries of Europe. For investors, this is excellent news. Still, it is possible to invest in assets whose potential for appreciation is far from being realized.
In an economic environment demonstrating attractive growth-data, a dramatic increase in tourism, and a stable geopolitical environment, the demand for real estate certainly reflects this trend. The government in the capital is initiating a series of measures designed to further accelerate the economy, and in response, an increase can be seen in the number of investors coming to this land of opportunities. It is really hard to believe that only thirty years ago it was a state of Russia, part of the Soviet Union. Since then, the market has become free and property prices are on a clear upward trend.
Property price still low (very)
Next to Batumi, which is a focus for investors, Tbilisi stands proudly. It is the largest city in Georgia and an economic hub that is showing increasing signs of prosperity. At this point, property prices in the metropolis, where about a quarter of the country’s residents live, are still surprisingly low. Just for comparison, you can get your hands on properties in good, sought-after areas, at prices several times lower than what is customary in the country. The more development and modernization that takes place and the more areas are declared for preservation, the greater the potential for investment. It is not unreasonable to find properties in Georgia at prices of about a third or a quarter relative to their counterparts in Israel. By the way, among the investors you can find young people and wealthy people, as well as young couples who are unable to afford a home in Israel. And anyone who owns a property in the state for two years or more is entitled to a tax exemption on capital gains at the time of sale.
Higher returns in comparison to other countries
By all expectations, the supply of properties in the central regions of Georgia will not be able to meet the demand of coming years. This fact has great significance. First of all, whoever buys properties now, with very high probability, is likely to see the property value continue its upward climb. This is the direction anywhere that the supply of apartments is fixed and there is high demand for residential rental properties. Second, the return on assets, particularly in Batumi and Tbilisi, reflects a much greater probability, relative to countries with the same level of development. The higher return is what makes the country a hot investment in the eyes of foreign investors expressing growing interest.
Relative proximity to Israel and investor-friendly mentality
With increased signs of the real estate market in Israel cooling, as well as in numerous European countries, Georgia’s encouraging potential stands out. With excellent return and the expected appreciation of the assets in the coming years, it is possible to add a few more noteworthy points:
- Proximity to Israel – Compared to countries like the US or even some European countries, Georgia is much closer. It is very easy and convenient to get on a flight to find quality properties.
- The local mentality is warm and quite sympathetic to Israelis. It is a very pleasant mentality to do business with.
- Relaxed regulation – As part of the desire to develop the economy and attract investors, the country is leading the way in simplifying regulations.
- Ease of property registration and ownership transfer – Property registration procedures in the name of the buyer and transfer of ownership are done with remarkable speed. The process can be completed even during a short stay in the country.
