Tbilisi’s Real Estate Market Experiences Spike in Demand
TBILISI - Real estate market experts in Georgia’s capital Tbilisi report that demand for housing and apartment rentals has increased since the end of the summer tourist season.
The noted that market had not experienced any considerable price increase compared to the same period last year.
While news of growing demand will be welcomed by estate agents, the demand for available affordable rentals priced at 200 USD or less per month far exceeds the supply.
Further compounding the situation is the glut of vacancies for medium to high-end rentals throughout the city.
Tbilisi as experienced a construction boom in the last two years. But those building projects have focused mainly on middle and upper-class housing ranging from small condos to luxury penthouses.
The overwhelming majority of the properties remain unoccupied, but the construction projects continue at the expense of new projects aimed at building affordable housing for the majority of Tbilisi’s population.
According to market sources, the minimum rental price for a centrally located, unfurnished one-bedroom apartment costs 300 USD, with Saburtalo as the most popular district in the city where low-end rental prices range from 250 USD to 300 USD for an apartment in an old Soviet-era block.
The increasing demand for cheaper property rentals has also reached Tbilisi’s suburbs, where housing shortages are common, and the condition of the properties tends to be very poor.
On the other hand, low price apartment search often happens without actual involvement from the real estate agencies, with a world of mouth more actively used in the process.
Nika Japaridze, a development manager for online property lister makler.ge, recently said in an interview with a local business journal that his company has over 30,000 ads on their site, indicating that the real estate market is very active due to the number of students coming to the city in search of cheap housing.
According to a recent survey of the real estate market, the price for 1 sqm property in Tbilisi ranged from 836 - 900 USD, with the price index decreasing year-on-year to 1.8 per cent as of June 1.
The survey found that the Mtatsminda district is the city’s most expensive region for both rentals and sales, with the sales price of 1 sqm of property averaging 1,011 USD and 9 USD for rentals.
The Samgori district was rated as the cheapest in the city, with the sales price for 1 sqm averaging 544 USD and a mere 5 USD for rentals.
The rental and sales prices for commercial spaces are significantly higher, coming in at 1,088 to 1,230 USD per sqm for a sales price and 10.1 to 12.0 USD per 1 sqm for rentals.
Real Estate Laboratory research showed an average of 2,384 monthly real estate transactions occurred from June 2015 to June 2016, 34.9 per cent of which ere sales were in the Vake and Saburtalo Districts.
By Nino Gugunishvili and Nicholas Waller