In recent years, Georgia’s real estate market has undergone a significant transformation. Rising costs of construction materials, increased demand, and urban development have pushed development prices to new heights. In this blog, we will discuss current prices and the factors that will define future trends.
According to Geostat’s 2025 data, the Residential Property Price Index (RPPI) increased by an annual average of 10-15%. The growth is particularly notable in the newly built residential segment. For detailed data, please refer to Geostat’s Residential Property Price Index
“According to TBC Capital’s June 2025 data, the average selling price of residential space in Tbilisi stands at $1,269 per square meter, representing an 8% increase compared to the same period last year.
The number of transactions in June 2025 increased by 11%, reaching 3,236 units. Meanwhile, the total market volume reached $264 million.
Construction Costs and Neighborhood Price Distribution
“According to the same study, the Construction Cost Index (CCI) in USD increased by 4.0% annually. Notably, there has been a significant rise in wages within the construction sector — a 16.7% increase compared to the previous year.
(Average price per $m^2$)
| Neighborhood | Price per m2 |
| Vake | $1,926 |
| Mtatsminda | $1,901 |
| Saburtalo | $1,524 |
| Didi Digomi | $1,134 |
| Gldani | $1,130 |
| Samgori | $1,026 |
For detailed information, you can access the full report here: [TBC Capital Research]
1. Construction Regulations
The new construction code and enhanced safety standards increase the overall prime cost of projects.
2. Shortage of Investment Land
Available space for multi-apartment residential developments is becoming increasingly scarce in Tbilisi and other major Georgian cities. Consequently, demand is rising, driving up the price per square meter of investment land.
3. Rising Wages and Material Costs
Market observations show that wages in the construction sector are growing significantly faster than the average annual inflation rate. Additionally, the costs of materials and logistics continue to rise every year
1. Decrease in Rental Yields According to TBC Capital, rental prices have decreased by 11% annually, leading to a drop in investment yield to 8.7%. As rental income declines, real estate becomes less attractive as an investment asset, which in turn slows down the rate of price growth.
2. Increased Supply in the Real Estate Sector Despite the scarcity of land in major cities, the volume of construction permits issued in the first half of 2025 is 17% higher than the previous year (TBC Capital). This indicates that in the short term, the growth in demand for apartments (11%) is lagging behind the growth in construction permits (17%).
Based on existing data, a radical drop in prices in 2026 is unlikely due to the high prime cost of construction (especially the significant rise in wages). In 2026, we expect prices to remain stable or show moderate (slower) growth. While the decline in rental prices and the abundance of new projects will hinder sharp increases, the high cost of construction will prevent prices from falling.
If you are interested in purchasing an apartment, it is essential to consider the cost of renovation. Before making a purchase, make sure to calculate the renovation expenses for your desired home:
To calculate renovation costs, visit: Renovation Calculator
Due to the rising prices of apartments, the idea of building a private house is becoming increasingly popular. If you decide to build a private house instead of purchasing an apartment, calculate the total cost of the entire construction process.
To start your estimate, visit: Construction Calculator