The FINANCIAL - Old Tbilisi and Vake-Saburtalo Lead the Most Expensive Districts for Residential Property

Old Tbilisi and Vake-Saburtalo Lead the Most Expensive Districts for Residential Property

Old Tbilisi and Vake-Saburtalo Lead the Most Expensive Districts for Residential Property

The FINANCIAL -- With 46,707 units the number of transactions on real estate registration has shown 11.6% growth in comparison with the same period of the prior year. Growth has been shown on primary as well as secondary transactions.

The number of primary real estate registrations stood at 9,416 units, while secondary - 37,291. The real estate sale market has shown signs of recovery amid Lari depreciation as of December 2015. The most expensive areas were still Old Tbilisi and Vake-Saburtalo, with average prices of USD 1,047 and USD 946 per m2 respectively. Isani-Samgori became the cheapest district for buying a residential property with an average of only USD 571 per m2.

According to the National Agency of Public Registry, transactions of real estate registry have grown by 11.6% in May 2016, in comparison with the same period of the previous year. The number totalled 46,707 units. May 2016 has shown predominant growth in comparison with the same month of the last three years. In May 2012 the number reached 46,856 units, a slight increase by 0.3% in comparison with the current year’s data. In May 2013, the number of transactions was 38,497, or 21.3% less than in May 2016. In May 2014 the number of registrations was 40,836, or 14.4% less. As of May 2015, the number of registration units was 41,867, or 11.6% less than in May of the current year.

The number of transactions as of May 2016, on primary registration transactions was 9,416, up from 7,850, or 19.9% more than in May 2015. As for secondary registration transactions, the number this year reached 37,291 units, up from 34,017, or 9.6% more than May 2015.

While YOY comparison has shown growth, the contrast of May 2016 with April 2016 was quite negative, showing a reduction by 16.4%. The drop has been expressed on both primary - by 29.4%, and secondary - by 12.3%, transactions.

With 16,132 units, Georgia’s capital Tbilisi was the top destination for real estate registrations as of May 2016. It was followed by Batumi - 3,289 units; Kutaisi - 1,626; Gardabani - 1,315; Gori - 1,309; Mtskheta - 1,220; Rustavi - 1,181; Ozurgeti - 952; Gurjaani - 920; and Zugdidi - 856.

According to the Real Estate Price Index of ISET Policy Institute, the real estate sale market has shown signs of recovery amid Lari depreciation as of December 2015.

As the analyses shows, average sale price on residential real estate started to increase in dollar terms during the last three month of 2015. Fisher index on rental prices of residential property fell drastically, decreasing annually by more than 18% terms in October 2015.

Chughureti has been the most expensive district for buying and renting commercial property in Tbilisi.

The average residential rental price first fell to USD 7.46 per m2 (a historical minimum since the start of the study by ISET-PI) in October 2015, and after a slight peak in the following month reached USD 7.66 per m2 by the end of the year. The average sale price revealed an increasing pattern during the last three months of 2015, and in December 2015 it amounted to almost USD 900 per m2.

Although the average price of residential property did not decrease much over three months, there was a substantial decline in the Fisher index of rental prices reaching its minimum of 0.83 with the largest annual drop of 18.8% in October 2015. This means that rental prices of a typical (average) residential property have declined considerably, but this decrease was compensated by the increase in supply of better quality rental property located in more expensive districts which kept the average prices high.

Throughout the different areas of Tbilisi, the average sale price increased in every district with the exception of Didube-Chughureti and Gldani-Nadzaladevi. The most expensive areas in December were still Old Tbilisi and Vake-Saburtalo, with average prices of USD 1,047 and USD 946 per m2 respectively. Isani-Samgori became the cheapest district for buying a residential property with an average of only USD 571 per m2, closely followed by Gldani-Nadzaladevi which averaged at USD 583 per m2.

The situation was somewhat similar on the residential rental market; Old Tbilisi and Vake-Saburtalo were the most expensive areas with average rents of USD 8.7 and USD 7.7 per m2 respectively. The cheapest district for renting flats is still Gldani-Nadzaladevi at USD 5.0 per m2.

On the commercial property market, the average sales price has declined significantly after its peak in July and went down to USD 1.14 per m2 in December 2015. The residential property market suffered a huge drop in rental prices in the last month of 2015, falling to a minimum of USD 10.37 per m2.

According to the analyses, the most expensive areas for buying residential property for the last three months of 2015 were Mtatsminda and Vake, with averages of USD 1,056 and USD 1,020 per m2 respectively. The cheapest districts were revealed to be Samgori and Gldani (USD 564 and USD 569 per m2). The most expensive and the cheapest districts in which to rent a property were Krtsanisi and Gldani, with average rental prices of USD 10.6 and USD 0.5 per m2.

As for the commercial real estate market, according to the researchers, it has shown few differences. Chughureti was the most expensive area for both renting and buying commercial real estate (with average sale and rental prices of USD 282 and USD 7.3 per m2 respectively). Gldani was again the cheapest district, with the lowest average sale and rental prices in Tbilisi (USD 31 and USD 0.3 per m2).

 


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