5 mistakes when buying real estate in Georgia
that could cost you tens of thousands of dollars
Reading time: 9 minutes
Usefulness *****
Hello!
My name is Roman, I have been working in real estate in Georgia for over 5 years, and during this time I have conducted dozens of transactions with clients from different countries.
People quite often come to me after they have already started the buying process, either on their own or with the help of a realtor. At this stage, nuances arise that were initially not mentioned or were overlooked.
This doesn't mean the market is "bad" or that someone is deliberately misleading. Most often, the reason is much simpler – the buyer doesn't have experience in the Georgian market specifically, and every market has its own peculiarities.
As a result, someone buys an asset without fully checking the documents, someone enters a project with increased risks, and someone expects one return but actually gets a completely different one.
At the same time, it's important to understand that the real estate market in Georgia itself is indeed interesting and offers opportunities. But only to those who understand its nuances.
In this article, I will break down the 5 most common mistakes buyers make and show you exactly where money is most often lost—so you can avoid these risks even before the deal.
People lose money on real estate in Georgia for several reasons:
In recent years, the real estate market in Georgia has truly grown significantly, and this is easily confirmed by the numbers.
For example, according to data from the National Statistics Office of Georgia and TBC Capital, in recent years alone:
- the number of real estate transactions in Tbilisi and Batumi has increased by more than 20-30% compared to 2021
- the share of foreign buyers in individual segments (especially in Batumi) reaches 70-80%
- real estate prices in key locations have increased by an average of 15-25%in individual projects - significantly higher
Against this backdrop, the market is attracting more and more people who consider buying as:
- investment
- method to preserve capital
- or simply the opportunity to own property by the sea
And at first glance, everything looks quite simple: you choose an asset, finalize the deal, and then it either increases in value or generates income.
But in practice, it's a bit more complicated.
Georgia has a relatively low entry barrier for developers. This means that both strong developers with experience and reputation, as well as companies with limited history or aggressive sales models, operate in the market simultaneously.
The situation is further complicated by the large number of listings. When a person starts looking for real estate, they encounter dozens of similar options — identical renders, similar terms, promises of high returns.
And here lies the key problem.
Without understanding the details, it becomes difficult to distinguish a truly liquid and safe asset from a project with increased risks.
Quite often, clients approach me who have already chosen a property themselves or are in the process of buying. It's at this point that we start to delve deeper into the situation.
Sometimes it turns out that:
- The object was purchased at a price above market value.
- The profitability in the calculations is overstated.
- or the project itself has nuances that were not disclosed at the start
And it's not always a question of bad faith. More often, it's simply a consequence of the market growing rapidly and information being presented in a simplified way.
For example, one common scenario is yield expectations.
Currently, the average net rental yield in Georgia, depending on the format and management, is around 5-8% per annum in dollars.
However, numbers are often found in advertising. 15-18% and abovethat do not take into account:
- Downtime
- Seasonality
- management and maintenance costs
And it is precisely in such discrepancies between expectations and reality that money is most often lost.
Therefore, the main reason for errors is not the market itself, but the lack of a systematic approach to selecting an asset.
Let's now break down the existing errors in detail and how to avoid them.
If you want to save time and get suitable options right away, you can start with a short survey – based on it, we will select properties for your task.
Error 1: Purchase without verifying ownership rights.
One of the most common mistakes is buying property without thoroughly checking the documents.
It usually looks like this: a person finds a property with a good price and location, gets confirmation that "everything is clean," and starts moving towards the deal. At this stage, it seems like the inspection is just a formality.
Georgia's property registration system is indeed simple, but precisely because of this, buyers often get a false sense of security.
It is important to understand - the mere fact of registering an object does not guarantee that there are no problems with it.
In practice, you may encounter:
- Encumbrances or liens
- arrests
- joint ownership
- Discrepancies between the actual object and the registry data
Real-world case
A client, Andrey, from Estonia, contacted me.
The task was clear—to buy a ready-made apartment by the sea in Batumi for personal use, without waiting for construction. He was only considering finished properties; it was more comfortable for him that way, and he wanted to spend the summer by the sea.
He already found a solution on his own:
- 1-room apartment
- New Batumi district
- approximately 38 square meters
- 19th floor
- with a sea view
The object looked attractive:
- market price
- A normal house
- The seller assured me that everything was in order with the documents.
Andrey approached me at the final stage – "just to look over the documents before the deal."
When the inspection began, it was discovered that the apartment was registered not to one owner, but to several people. Furthermore, one of the owners did not actually participate in the sale and did not give consent.
During the viewing stage, there were no signs of this – the apartment was shown, negotiations took place, everything looked standard.
But if the deal had gone through in that form, it could have led to:
- disputing the transaction
- freezing of the object
- lengthy legal proceedings
In the end, they decided against the purchase and started looking for an alternative.
And this is an important point - the problem isn't that the object is "bad." The problem is that the nuances weren't checked in advance.
Why is this happening?
The main reason is the feeling of simplicity of the transaction.
The buyer seems to think:
- Since there's a register, it means everything has been checked.
- If the object is being shown, it means everything is fine with it.
Plus, pressure is added over time:
- This object will be picked up now
- We need to make the reservation faster
And at that moment check takes a backseat.
How to check correctly
The minimum you need to do before buying:
- Check the registry extract
- Confirm ownership and authority
- Check for encumbrances, liens, and arrests
- Match the physical object with the registration data
And it's important not just to get the document, but to interpret it correctly.
Output
Document verification is not a formality but one of the key stages of a transaction.
This is where it's decided whether you're buying a safe asset or an object with potential legal risks.
🔹 Error 2: Purchase in a project at risk of non-completion
One of the most underestimated mistakes is buying during the construction phase without assessing the project's risks and the developer's.
At the selection stage, everything looks as attractive as possible:
- Beautiful renders
- modern complexes
- Infrastructure promises
- lower price compared to ready-made properties
And the buyer develops a logic: "I'll buy now cheaper, and I'll earn the change by the price increase."
In some cases, it really works. But only if the project is completed on time and with the stated quality.
What's important to understand about the market
Georgia has a relatively low barrier to entry for developers. This means new projects are launched regularly, but their reliability can vary greatly.
According to market and analytical reviews (including TBC Capital), in recent years:
- A significant portion of the projects faced construction delays.
- in some cases, delays ranged from 6 months to a few years
- Some projects were frozen or implemented with significant changes compared to the original concept.
Important — it's not about the majority, but about a sufficiently noticeable share of the market to take this into account when buying.
Real-world case
A client, Mikhail, approached me. He was considering buying an apartment in Batumi as an investment.
He found a project at the foundation stage.
- The price is noticeably below market.
- Above-average promised returns
- Active sales and "limited lot quantity"
At first glance, it looked like a good opportunity to "get in on the ground floor."
When they started to examine the project more deeply, it turned out:
- The developer had no completed projects of comparable scale
- The construction deadlines have already been postponed.
- The project's financial model was based on constant sales, without a sufficient cushion.
From the buyer's perspective, this meant high risk:
If sales rates fall, construction slows down or stops.
In the end, the client decided not to go ahead with this project.
After some time, construction indeed slowed down, deadlines were pushed back, and some investors found themselves in a situation where their money was "frozen" with no clear exit timeline.
Why is this happening?
The main reason is the focus only on price and promises.
Customer sees:
- cheaper than others
- It will be a cool complex
- I will earn from growth
But it doesn't analyze:
- Who is building
- On what money is the project being built?
- Does the developer have any completed projects?
- How realistic are the deadlines
How to reduce risks
Before purchasing, at the construction stage, it is important to assess:
- developer history and completed projects
- Adherence to deadlines on previous projects
- construction stage and work progress
- Financial stability (how much the project relies on new sales)
- legal structure of the project
Output
Buying during the construction phase can be a profitable strategy.
But only with the correct risk assessment.
Otherwise, it turns not into an investment, but into a situation where money can be frozen indefinitely.
🔹 Error 3: Underestimating expenses
One of the most common situations is when a person only considers the purchase price and expected income, but does not take into account the actual costs of maintaining the property.
At the selection stage, everything looks simple:
- the apartment costs, for example, 60,000$
- for rent for 500-600$ per month
- So, the yield looks high
But there is a big gap between "gross income" and real profit.
What is usually not taken into account
In practice, real estate in Georgia has regular and one-time expenses that directly affect the final profitability:
- home maintenance - on average from 0.5 to 1.5$ per m² per month
- Management company services (if handed over for management) — 20-40% of income
- Utility bills
- Minor repairs and wear and tear
- Vacancy between tenants
As a result, the actual profit may differ from expectations by tens of percent.
Real-world case
A client, Pavel, approached me. He had already bought a studio in Batumi for approximately$58,000.
The goal was classic – to rent it out and receive a stable income.
Before the purchase, he was given an estimated income of 700-800$ per month for short-term rentals.
Essentially, what happened was:
- The average annual income is about 500$ per month
- Some months had lower utilization
- additional:
- The management company was taking about 30%
- Home service - around 1$ per m²
- There were occasional expenses for minor repairs
In the end, the real yield turned out to be around 6-7% годовых, instead of the expected 12%+.
The property itself is fine—it's rented out, not sitting vacant critically, but the initial expectations were too high.
Why is this happening?
The main reason is the focus on the "top line."
The buyer is shown:
- maximum possible rent
- excluding downtime
- excluding expenses
And a feeling is formed that this is reality.
Adding to that is the desire to "find a better market option," where the yield is above average.
How to count correctly
Before buying, it's important to consider not the "ideal scenario," but the real one:
- Consider the average, not the maximum rent
- to schedule downtime
- consider all fees and expenses
- Calculate net yield, not turnover
Output
Real estate in Georgia can provide a stable income.
But only if you consider the economy fairly from the outset.
Otherwise, the difference between expectations and reality becomes an unpleasant surprise after the purchase.
Error 4: Incorrect location selection
One of the most common mistakes is choosing real estate based only on external parameters, without analyzing the location itself.
At the selection stage, everything looks simple:
- There is a sea view
- new house
- nice renovation
- Good price
And it feels like that's enough.
But in practice, it is the location that primarily determines:
- object liquidity
- Rent demand
- resalability
What is often overlooked
In Batumi and other coastal areas, development is progressing very actively.
This means that:
- Available plots are being built up quickly.
- Building density is increasing
- The view that exists today may disappear in 1-2 years.
Plus, not only the neighborhood itself is important, but also the specific location within it:
- distance to the sea
- infrastructure
- transport
- type of development around
Real-world case
A client, Igor, contacted me. He bought an apartment in Batumi for rental income and occasional vacations.
The parameters were:
- studio
- About 30 m²
- Front-line neighborhood
- sea view
- The price is slightly lower than comparable products.
At the time of purchase, the property looked like a great option—especially because of the view.
But after some time, construction began on a new complex right in front of the house.
As a result:
- partially sea view
- The attractiveness of the property to tenants has decreased
- The resale price stopped growing at the rate the client had expected.
The object itself remained, it didn't become "bad," but its investment attractiveness significantly decreased.
Why is this happening?
The main reason is the "here and now" assessment of the object.
Customer is looking at:
- current view
- current price
- current state of the district
But it doesn't analyze:
- development plans around
- vacant lots
- development prospects for the district
How to reduce risks
Before purchasing, it's important to assess not only the property itself but also its surroundings.
- Are there any free spots in front of the house?
- What can be built on these plots
- density of construction in the area
- Actual demand for rentals in this specific location
- price dynamics by district
Output
Location is not just "where the apartment is."
This is a factor that directly affects:
- income
- liquidity
- the ability to exit an investment
And a mistake in choosing a location may not cost you right away, but in 1-2 years, when nothing can be changed anymore.
🔹 Error 5: Overestimated Returns
One of the most common reasons for disappointment after a purchase is when earnings expectations don't match reality.
At the selection stage, the buyer is often shown the "top" model:
- maximum load
- high rental cost
- ideal scenario with no downtime
As a result, there's a feeling that the asset will generate above-market returns.
What is shown and what is obtained
In practice, the difference between expectations and reality can be significant.
For example, regarding the Batumi market:
- average real rental yield is around 5-8% per annum in dollars
- with good management and a favorable location, it can be a bit higher
- but stable values are higher 10% occur significantly less often
At the same time, advertisements often show:
- 12-15% per year
- and sometimes higher
These numbers are most common:
- do not take seasonality into account
- they do not account for downtime
- They do not take commissions and expenses into account
Real-world case
Clients regularly come to me with specific expectations:
We saw a project that promises 15-18%% annually in dollars. We want something similar.
And here it's important to honestly analyze the situation.
For example, one client was looking at an apartment for around 60,000$ with a promised income of about 800$ per month.
At first glance, it looks attractive.
But if we break down the economy:
- 800$ per month is the rental level for a full 1+1 apartment in a good location, not a studio.
- meanwhile, the cost of such an apartment with renovations will be noticeably higher
- plus are added:
- management commission
- Downtime
- Seasonality
What did we do in the end?
We've backed out of this property. We've found a good option. Parameters:
- Area: 360 square feet
- Price 1000$/m²
- Summary for object: 33,600$ (white frame)
The house itself: gas, underground parking, good location, nice view. At this stage, everything looked like a standard story.
But there was an important point.
There are many studios in this area. And if you do it "like everyone else," then: high competition, price pressure, and unstable workload. Therefore, the task was not just to buy, but to lay down the difference immediately.
We arranged with the developer and installed underfloor heating before the screed.
It cost: 11$/m² around 370$)
Next is renovation for rent: approximately 500$/m²total ~ 16 800$)
In the end, the final cost of the apartment came out to: 👉 50 769$ под ключ
Now the most important thing is the numbers.
In this area, studio apartment rentals start from 350$ to 500$ per month
We consistently deliver with a yield of: 👉 about 400$ per month
Annual income: 👉 400$ × 12 = 4 800$
Let's count reality next: tax: 5% → 240$ + management: ~ 302$ per year
Leaves clean: 👉 ~4 258$ в год (~8,3% годовых)
The result is excellent, everyone is satisfied – expectations and reality met.
Why is this happening?
The main reason is the desire to find "better than the market".
The buyer seems to think:
- There are options with high profitability
- You just need to find the right object.
And against this backdrop:
- Basic market principles are being ignored
- Decisions are made based on advertising promises.
How to look at profitability correctly
Before purchasing, it is important:
- calculate the average, not the maximum income
- consider seasonality (especially in resort towns)
- consider downtime
- Consider all expenses and fees
- compare with real statistics, not advertising
Output
Real estate in Georgia can provide a stable return.
But it is rarely "super profitable" without increased risks.
If the numbers are noticeably higher than the market, it's a reason not to rejoice, but to dig deeper.
Outcome
If we look at all the mistakes we've discussed above, they have one common cause.
Not the market itself.
Not "bad" objects.
And not even individual parties to the transaction.
And a lack of a systematic approach to choosing real estate.
In most cases, money is lost not at the moment of purchase, but much earlier—during the analysis of the object, document verification, location assessment, and evaluation of actual profitability.
And the good news is that these mistakes can be avoided.
The only question is, do you understand:
- What specific risks need to be checked?
- In what order should this be done?
- And how to distinguish a truly reliable object from "pretty packaging."
To close this issue, I've broken down a step-by-step approach that allows:
- screen out weak and risky options during the selection phase
- save time by not looking at unsuitable properties
- and make a decision based on numbers and facts, not promises
