BAKU, Azerbaijan, July 29. Georgia's
Residential Property Price Index rose 4.9% year-on-year in Q2 2026,
with prices now 63.8% above the 2020 average, the National
Statistics Office shows.


The RPPI covers the new residential property market in
Tbilisi, including both flats and detached houses. On a
quarter-on-quarter basis, the index rose 0.9% from Q1 2026. Flats
rose 4.8% year-on-year and 0.9% quarter-on-quarter; detached houses
gained 5.5% year-on-year and also 0.9% on the quarter.


Trend's
analysis shows that the 4.9% annual growth rate continues a pattern
of deceleration from the sharp price spikes of 2022-2023, when
Tbilisi's new-build market absorbed a large wave of Russian and
Belarusian buyers following the onset of the conflict in Ukraine.
Annual growth in that period is estimated to have peaked at 35-40%
in 2022 before moderating to 15-20% in 2023 and 8-10% in 2024. The
Q2 2026 figure of 4.9% represents an approximate normalization
toward a sustainable growth range, though Trend's calculation shows this is still
meaningfully above Georgia's consumer price inflation - currently
running at approximately 3.2% - meaning new-build property
continues to appreciate in real terms, at roughly 1.7% per year
after inflation.


0.9% QoQ annualizes to approximately 3.6%, which is
below the 4.9% annual rate. This means the pace of price growth in
recent quarters has been slower than the year-ago average -
confirming that deceleration is ongoing rather than having bottomed
out.







Based on the 63.8% cumulative increase since 2020,
Trend's calculations
imply that Tbilisi new-build prices that averaged approximately
$950 per square meter in 2020 would now be in the range of
$1,550-1,560 per square meter for the index-covered segment -
consistent with market data showing central Tbilisi new
developments priced at $1,200-2,500 per square meter depending on
location and specification. The compound annual growth rate since
2020 is 8.6%, which over six years has produced a 63.8% cumulative
appreciation.


Detached houses outpacing flats on the annual
comparison (5.5% vs 4.8%) is a nuanced signal. In a normalizing
market, house prices typically show more volatility because the
segment is thinner and more sensitive to the composition of
transactions in any given quarter. However, sustained house-price
outperformance can also reflect demand from wealthier buyers -
including foreign investors - seeking larger family units, a
segment where Tbilisi has seen growing interest from Middle Eastern
and diaspora buyers as the Russian buying wave has subsided.


The overall picture is of a market that has absorbed a
large external demand shock, repriced significantly, and is now
settling into a steadier appreciation trend anchored more by
domestic income growth and tourism-driven rental demand. Rental
yields in Tbilisi for short-term accommodations remain attractive
at 6-8% gross, supported by strong growth in inbound tourism, which
creates a floor under investor demand for new-build units even as
the pace of price appreciation moderates.