Three in four buyers of new Tbilisi flats this year were local, and construction costs are up 29% since 2022
A market review published in August 2026 put local buyers at 76% of surveyed sales in Tbilisi's primary market this year, with Russian buyers at 3%. Geostat's residential property price index rose 4.9% year on year in the second quarter and sits 63.8% above its 2020 average. The construction cost index rose 3.9% year on year in June and is 29.3% higher than in February 2022, with transport, fuel and electricity the biggest contributor.
The buyer profile is the headline
Local buyers accounted for 76% of surveyed sales in Tbilisi's primary market in 2026, against 3% for Russian buyers. For anyone whose mental model of this market is still the 2022 and 2023 influx, that is the correction. Demand in new-build Tbilisi is now mostly domestic, which means it tracks Georgian incomes, lending conditions and household formation rather than migration flows. It also means a seller pricing a new flat for a foreign buyer who is no longer the marginal purchaser may be waiting a long time.
Prices: slower, but still rising
Geostat's residential property price index rose 4.9% year on year in the second quarter of 2026 and stands 63.8% above the 2020 average. Primary market prices were reported up 6.1% year on year in May, and Galt & Taggart's expectation is annual growth in a 5 to 7% band, attributed to urbanisation, smaller household sizes, rising incomes and investment returns. The description in the review is of a market that has stopped accelerating rather than one that has turned, and the words used are that price growth has stabilised.
Why developers are not cutting prices
Because the floor under them has risen. The construction cost index was up 0.9% on the month and 3.9% on the year in June 2026, and 29.3% above February 2022. Transport, fuel and electricity rose 16.6% year on year and contributed 1.9 percentage points of that annual increase on their own. Residential construction specifically rose 2.6% from May and 3.5% on the year, while non-residential costs were marginally lower. A buyer waiting for discounts on off-plan stock is betting against a cost base that has not stopped moving.
What to do with this if you are selling or buying
If you are selling, price against what a Georgian household with a Georgian mortgage can pay, because that is now the buyer in front of you. If you are buying, a cost base rising faster than wages is the reason developers hold their asking prices, and it argues for comparing a finished resale flat against a new build rather than assuming the new build will be discounted. The review also notes a Tbilisi gross rental yield of 8.4% in May 2026, described as in line with its long-term average, which is a reminder that the rental case here has been more stable than the price case.
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Written by us from the source linked above, not investment, legal or tax advice. Figures and rules change — confirm anything that matters before acting on it.
