Tbilisi against Baku: rents are 19% higher here, salaries 16% higher, and the mortgage is the real gap

On the indices, Baku comes out cheaper almost everywhere: cost of living excluding rent is 13.6% lower, including rent 17.0% lower, rents 27.0% lower, groceries 16.5% lower and restaurants 8.8% lower. The exception is the one that matters to residents rather than visitors. Local purchasing power is only 1.0% higher in Baku, which is to say the two cities are effectively level once wages are set against prices. Tbilisi is the more expensive city and also the better-paid one, and the two cancel out.

A one-bedroom in the city centre is listed at ₾1,751.64 a month in Tbilisi and ₾1,416.80 in Baku, a 19.1% difference. The average net monthly salary is ₾1,712.75 against ₾1,435.89, a gap of 16.2% — almost exactly the same proportion. In other words the rent-to-salary burden is close to identical in the two capitals, which is a more honest comparison than either number alone. Purchase prices are closer still: the dataset quotes city-centre buying at ₾583.55 per square foot in Tbilisi and ₾545.18 in Baku, a difference of only 6.6%.

The widest gap in the whole comparison is the cost of borrowing. A 20-year fixed mortgage is quoted at 12.69% in Tbilisi and 9.08% in Baku — 28.5% lower in Azerbaijan in relative terms, and more than three and a half percentage points in absolute ones. On near-identical purchase prices, that is the difference between two very different monthly payments and two very different leveraged returns. If you are comparing the two cities as places to buy rather than places to live, the finance line is doing far more work than the price line.

These are crowd-sourced figures, built from 153 contributors in Tbilisi and 141 in Baku over the past twelve months, and they describe what people report paying rather than what the registries record. They are reliable enough for the shape of a comparison and not reliable enough to underwrite a purchase. Two further caveats: the purchase figure is per square foot, not per square metre, so multiply by about 10.76 before comparing it to any local listing, and both cities are quoted here in lari, which folds the exchange rate into every line. Use it to decide which market to look at properly, then do the looking with local data.