Tbilisi
As an investor looking to diversify your portfolio, you should consider the emerging real estate market of Tbilisi, Georgia. Nestled in the Caucasus region, Tbilisi is a picturesque capital city with stunning architecture, a vibrant food scene, and a low cost of living. While Tbilisi may not yet be on the radar of major institutional investors, for savvy individuals willing to get in early, the potential returns on investment in Tbilisi real estate are significant. Here are the top five reasons Tbilisi should be on your list for up-and-coming property markets with strong opportunities for growth. With a stable political environment, ongoing infrastructure improvements, and popularity as an expat and tourism hub, Tbilisi exhibits many of the signs of a city poised to break out on the global stage. By investing now in this blossoming market, you stand to benefit substantially as Tbilisi gains wider recognition as an attractive and affordable place to live, work, and play.
Strong Economic Growth and Foreign Investment
As an investor looking for emerging markets with strong potential, Tbilisi, Georgia should be at the top of your list. Here are five reasons why investing in Tbilisi real estate is a smart move:
Tbilisi has a fast-growing, business-friendly economy. Georgia’s pro-business government policies and low taxes have attracted substantial foreign direct investment. Tbilisi accounts for nearly half of Georgia’s GDP, and the economy has been growing at an average of 5% annually. This trend is projected to continue as more global companies enter the Tbilisi market.
The cost of living and real estate in Tbilisi are affordable. Compared to other major cities, housing and living costs in Tbilisi are lower. This means your investment dollars will go further, and rental yields and returns on investment are higher.
Tourism in Tbilisi is booming. Tbilisi’s rich history, culture, food, and natural scenery have made it an increasingly popular tourist destination. This boosts demand for short-term rentals and hospitality properties.
Infrastructure and development are expanding. New roads, public transit, hospitals, shopping centers and residential complexes are being built across the city. This infrastructure growth will further raise the value of properties in Tbilisi.
A strategic location and pro-business environment. Tbilisi’s location positions it as a regional hub for business and trade. Coupled with competitive tax rates and reduced barriers for foreign businesses, Tbilisi’s strategic importance and business environment create ideal conditions for real estate investment.
In summary, Tbilisi’s vibrant economy, affordable living costs, growing tourism, expanding infrastructure, and strategic location all signal that now is the time to invest in Tbilisi real estate. The city shows no signs of slowing down, so invest now to take advantage of this emerging market and position yourself for high returns.
Growing Tourism Industry
As an investor, you should consider Tbilisi’s growing tourism industry as a major reason to invest in the city’s real estate market.
Tbilisi welcomed over 5 million international visitors in 2019, a 5% increase from the previous year. Georgia’s capital city is becoming an increasingly popular tourist destination, attracting travelers seeking culture, food, nightlife and outdoor adventures.
- Tbilisi’s historic architecture, museums, theaters, and churches showcase its diverse history and culture. New luxury hotels are opening to meet demand, and short-term vacation rentals are on the rise.
- Tbilisi’s culinary scene is garnering global attention. Traditional Georgian cuisine, with influences from Europe and Asia, attracts foodies from around the world. The city now boasts a variety of international restaurants as well.
- An emerging nightlife featuring clubs, bars, and music venues appeals to younger visitors and locals. New craft breweries and wineries are also gaining popularity.
- Outdoor recreational activities like hiking, biking and skiing in the nearby Caucasus Mountains provide easy access to nature and adventure.
As tourism further develops over the coming years, demand for short-term and long-term rentals as well as new hotels and recreational facilities will increase. Investing in Tbilisi real estate now can deliver strong returns as the tourism industry realizes its full potential. The city shows no signs of slowing as a must-visit destination.
Tbilisi’s ascendance as a tourist hotspot combined with Georgia’s business-friendly environment make real estate investment in the capital city an attractive opportunity for visionary investors seeking promising returns. The future is bright for Tbilisi’s real estate market.
Affordable Property Prices
Property Values Continue to Rise
Real estate prices in Tbilisi have been steadily increasing over the last decade due to strong economic growth and demand. According to Colliers International, residential property prices in Tbilisi rose by about 7-9% in 2019. Investors can take advantage of this upward trend in property values by purchasing real estate now before prices rise further.
Low Cost of Living
The overall cost of living in Tbilisi is very affordable compared to other capital cities in Europe. Everything from food and entertainment to utilities and housing costs less in Tbilisi. Investors and those looking to retire abroad can live comfortably in Tbilisi without breaking the bank. Buying property, in particular, is very budget-friendly. Apartments in Tbilisi sell for a fraction of the cost of comparable properties in Western European cities.
Rental Demand and Yields
There is a shortage of high-quality housing in Tbilisi to meet the needs of tourists, expats, and locals. New developments are quickly rented, and rental yields are attractive for investors. Gross rental yields in Tbilisi’s residential market are typically 6-8% per annum. Strong demand and limited supply bode well for buy-to-let investors and those looking to generate monthly cash flow from their Tbilisi property.
In summary, real estate in Tbilisi offers investors an affordable entry point into a fast-growing property market with the potential for strong returns. And for those looking to reside in Georgia’s charming capital city, low living costs and a thriving cultural scene make Tbilisi an appealing place to call home. With such an attractive combination of factors, it’s easy to see why interest in Tbilisi real estate continues to intensify.
Low Cost of Living
One of the top reasons Tbilisi remains an attractive location for real estate investment is its low cost of living. Compared to most major cities, the overall living expenses in Georgia’s capital city are very affordable.
- Housing costs are low, with rental prices averaging around $450 to $900 per month for a one- or two-bedroom apartment in the city center. Mortgage rates are also reasonable, often under 6% interest.
- Healthcare in Tbilisi is inexpensive, with basic doctor visits costing around $20 to $50. Private health insurance is affordable, with plans starting around $30 to $100 per month.
- The price of food staples and dining out is budget-friendly. You can have a meal at a mid-range restaurant for $10 to $15 per person. Groceries from markets and supermarkets are also very affordable.
- Utility costs like electricity, heating, and internet are low compared to most cities. Basic utilities for an apartment will likely total $100 to $200 per month.
- Taxes in Tbilisi are relatively low, especially for businesses. The corporate tax rate is just 15%, and individual income tax rates are a flat 20%. Property taxes are also reasonable, around 0.4% of a property’s value per year.
With such an affordable standard of living, your investment dollars will go further in Tbilisi. The money you save on living expenses can be used to generate additional income and higher investment returns. The low costs also make Tbilisi an attractive location for employees and companies in a variety of sectors. Overall, the affordable living attracts residents, boosts economic activity, and strengthens Tbilisi’s real estate market.
Solid Rental Yields and Capital Appreciation Potential
Solid Rental Yields
Investing in Tbilisi real estate can provide stable and attractive rental income. According to Number, rental yields in Tbilisi average around 7-8% per annum, 10-12 % for short term. This is higher than in other major European cities. As Tbilisi’s economy and tourism industry continue to grow, demand for rental housing will likely increase, enabling investors to raise rents over time and boost yields.
Significant Price Appreciation Potential
Real estate prices in Tbilisi have increased substantially over the past decade, especially in the city center. According to TBC Bank, apartment prices in Tbilisi rose by an average of 6-8% per year from 2010 to 2019. As Tbilisi’s economy develops further and demand for housing rises, real estate values should continue appreciating steadily over the long run.
Other Benefits
- Currency hedge: Investing in physical real estate acts as a hedge against currency depreciation. If the Georgian Gel declines in value, the relative worth of your property increases.
- Tax incentives: Georgia has low property taxes and no capital gains tax on real estate. Rental income is taxed at just 5%.
- Visa eligibility: Purchasing real estate in Georgia valued at USD $100,000 or more qualifies foreign investors for a residence permit.
In summary, Tbilisi real estate offers an attractive combination of solid rental income, significant price appreciation potential, tax benefits, and visa eligibility. For buy-and-hold investors seeking portfolio diversification and stable returns, Tbilisi property is worth considering. With a growing economy, increasing tourism, and strong demand fundamentals, Tbilisi real estate should continue to strengthen as an asset class over the long run.
Conclusion
As you can see, Tbilisi offers attractive opportunities for real estate investment. With a growing economy, increasing tourism, and foreign investment, property values are on the rise. The low cost of living and inexpensive property prices allow your investment dollars to go further. The capital city is modernizing rapidly, with improving infrastructure and amenities. Tbilisi real estate provides solid opportunities for both capital appreciation and rental income. Whether you’re looking to diversify your investment portfolio or purchase a second home abroad, Tbilisi should be on your shortlist of places to consider. The time to invest in Tbilisi real estate is now, before prices rise further and the market becomes saturated. Tbilisi offers beauty, culture, and financial opportunity—all in one captivating package.