Real Estate Investment in Batumi: Taxes and Legal Nuances for Foreigners

Georgia isn't just open to foreigners; it creates an exceptionally favorable environment for them.

There is no entry threshold: you can purchase property of any value. Furthermore, investments in Batumi grant the right to obtain a Residence Permit if the purchase amount exceeds the statutory limit (currently starting from $100,000).

The transparency of the property registration system via the Public Registry (House of Justice) minimizes corruption risks, making transactions quick and straightforward.

Foreign citizens enjoy exactly the same rights to own residential and commercial real estate as Georgian citizens. You receive full ownership rights (Freehold), which are perpetual and inheritable.

The only restriction concerns agricultural land—foreigners are prohibited from buying it. However, if you plan to buy real estate in Batumi within city limits or resort zones (apartments, villas, commercial spaces), these lands hold "non-agricultural" status and are available for purchase without restrictions.

Transaction Nuances

The transaction can take place either remotely (by Power of Attorney) or in person. A crucial point: the Sales and Purchase Agreement (SPA) is drafted in two languages—Georgian and the buyer's native language. Both versions have legal force, but in case of discrepancies, priority is often given to the Georgian text. This is why transaction support by a professional broker is critically important.

Georgia is famous for its liberal tax system. Many fees common in European countries are absent here.

1. Purchase Tax: None. Upon registering the Title Deed, you only pay a duty to the Public Registry (the amount is nominal, from 50 to 200 GEL depending on urgency).
2. Property Ownership Tax: Individuals are exempt from property tax if their family income derived within Georgian territory does not exceed 40,000 GEL per year.
3. Resale Tax (Capital Gains): If you own the property for more than two years, the capital gains tax is 0%. If sold before this period, the rate is 20% of the difference between the purchase and sale price.

Taxes on Rental Income

If your goal is investment in resort real estate for rental purposes, it is important to be aware of the rates. The standard income tax is 20%. However, by registering as a "Small Business" (Micro Business status does not apply to residential rentals, but Small Entrepreneur status exists), the rate can be reduced to 1% or 5% depending on turnover and the type of rental activity. However, there are many pitfalls here requiring consultation with a tax lawyer.

The most common mistake of a novice investor is the belief that buying directly from the developer is cheaper and safer. In practice, investments in new developments in Batumi through the developer's sales department carry specific risks.

The developer always protects their own interests. Contracts are often drafted such that penalties for late delivery are minimal or non-existent, while the buyer's rights to terminate the contract are severely curtailed. Furthermore, "beautiful renders" do not always match the final infrastructure.

Our real estate agency acts as an independent filter. We know the real financial standing of developers, the history of their past projects, and the "fine print" in contracts. We are not tied to a single complex and select a property based on your objectives, not a specific construction company's sales plan.

The market is maturing. While previously one could enter a project at the excavation stage for minimal sums, today property prices in Batumi are rising alongside construction quality.

The average price of a liquid square meter in a prime location (Heroes' Alley, New Boulevard) in "White Frame" or "Turnkey" condition ranges from $1,200 to $2,500.

Rental yield averages 8–12% per annum in foreign currency, which is significantly higher than European figures. However, achieving these numbers is possible only with competent property management, the right location choice, and a view, which plays a decisive role in Batumi rental pricing.