How to Calculate the ROI of an Apartment in Batumi
By 2026, the Batumi real estate market has finally transformed from chaotic to systemic. While investors previously purchased square meters driven by emotions—inspired by the sea and khachapuri—today, cold calculation takes center stage. The era of "money out of thin air" is over; the era of the professional approach has arrived.
The main question every investor must ask before closing a deal is: what is the real ROI (Return on Investment) of real estate in Batumi, and are the developer's promises merely a marketing ploy? In this article, we will break down exactly how to crunch the numbers to avoid mistakes and explain why the figures in advertising brochures often diverge from the reality of your bank account.
The main question every investor must ask before closing a deal is: what is the real ROI (Return on Investment) of real estate in Batumi, and are the developer's promises merely a marketing ploy? In this article, we will break down exactly how to crunch the numbers to avoid mistakes and explain why the figures in advertising brochures often diverge from the reality of your bank account.
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Why Old Calculation Methods No Longer Work
Just a few years ago, the formula for success seemed primitive: buy any studio by the sea, list it on Booking.com, and wait for the influx of tourists.
Today, this approach leads to losses. Competition has increased exponentially. Tourists have become selective: they demand hotel-level service, a swimming pool, coworking spaces, and high-quality renovations. "Dated interiors" or empty concrete shells no longer generate income.
To understand the payback period of an apartment in Batumi, you cannot simply multiply the daily rental rate by 365 days. The market has distinct seasonality, and the cost structure in Georgia has unique features that sellers often fail to mention.
What Makes Up Real Rental Yield
Let’s break down the economics of the rental business to the molecular level. Your profit is not what the guest paid, but what remains in your pocket after all deductions.
Seasonality as the Main Risk Factor
In Batumi, the year is divided into three unequal parts, and rental yield depends directly on how your property performs in each period:
- High Season (July – August – early September). A time of extraordinary profits. Occupancy reaches 90–95%, and prices are at their peak. These are the metrics developers love to show in presentations, creating the illusion that this performance lasts all year.
- Shoulder Season (May, June, October). The period of the "smart tourist." Occupancy drops to 60–70%, and prices decrease. Complexes with heated pools and prime locations win during this time.
- Low Season (November – April). The most challenging stage. Daily rentals practically die out. To prevent vacancy, the apartment must be switched to a mid-term format (monthly rentals). Here, amenities are critical: central or gas heating (not just an AC unit), a dedicated workspace, and a fully equipped kitchen.
Hidden Costs That Kill ROI
To calculate a honest ROI for Georgian real estate, you must deduct the following mandatory expenses from your Gross Income:
- Property Management Fee. If you don't live in Batumi, you need an operator. Quality service costs 30–40% of revenue. If you are offered 10–15%, be wary: the property will likely be poorly maintained and lose its rating.
- Maintenance Fee (Service Charge). Elevators, security, groundskeeping. In modern business-class complexes, this costs $1.50 – $2.50 per square meter per month. This must be paid year-round, even if the apartment is empty.
- Utilities. Electricity, water, internet. During the active AC season, bills can be substantial.
- Sinking Fund (Maintenance Reserve). The humid subtropical climate is ruthless on appliances and renovations. Budget 5–7% of annual income for linen replacement, wall touch-ups, and minor repairs.
- Taxes. For individuals, the tax on rental income is 5%.
Only after deducting all these items do you get the Net Operating Income (NOI), which should be divided by the property cost to calculate the payback period.
Payback Calculation Example (2025 Case Study)
Let's take a popular format: a "1+1" apartment (one bedroom + living room) in a good complex on the New Boulevard.
- Property price (turnkey with furniture): $80,000.
- Projected Gross Income: $12,000 per year.
- Management Company (30%): – $3,600.
- Maintenance Fee ($2/m² × 50m² × 12 months): – $1,200.
- Utilities and Internet (average): – $700.
- Tax (5%): – $600.
- Repair Reserve: – $500.
Total Net Profit: $5,400.
Real Payback Period: $80,000 / $5,400 ≈ 14.8 years.
Net ROI: 6.75%.
This is a realistic scenario for an "average" apartment. However, our task as a professional agency is to find properties where this indicator is better. We know complexes where the payback period is 8–9 years due to unique locations, lower entry costs (presales), or more efficient management.
Why Buying Through an Agency is More Profitable Than Buying from a Developer
There is a persistent myth: "It's cheaper directly from the developer." In 2026, this statement is often false. By buying on your own, you are playing roulette where the odds are not in your favor.
Risks of Direct Purchase:
- Conflict of Interest. The sales manager works for the developer. Their KPI is to sell a specific unit stack, even if it faces a wall or sits above a noisy restaurant. They don't care how you will rent it out later.
- Detachment from Reality. Developers sell "dreams" and renders. They might promise a SPA center by the handover date, but in reality, the infrastructure may launch 3 years later. During this time, your apartment will rent for less.
- Weak Management. Often, developers' "pocket" management companies lack the motivation to fight for your specific apartment's occupancy, prioritizing the company's own inventory first.
Advantages of Working With Us:
- Objectivity. We are not tied to a single complex. We compare the entire market and select what is truly liquid. We will honestly say: "There will be dampness issues here," or "The construction next door here will drag on for 5 years."
- Exclusive Prices. Agencies often have access to closed pools of apartments and assignment deals (resales) from early investors that are cheaper than the developer's current price list.
- Analytics, Not Promises. We operate with real rental data from similar apartments. We don't guess the payback period; we know it from the experience of hundreds of clients.
We help formulate a strategy: whether to buy a ready-made turnkey business or enter an off-plan project in a promising area like Gonio, where capital appreciation potential is higher than in the overheated city center.
2026 Trends: What to Bet On?
The market is changing, and investor strategies must evolve with it. Currently, the highest yields are not shown by micro-studios (oversupply has driven prices down), but by full-fledged family apartments and branded residences.
There is also growing demand for properties with gas heating. This is critical for winter rentals. An apartment with central heating rents for twice as much and much faster in winter than one where heating relies solely on air conditioning.
Another trend is the rise of the suburbs. Gonio and Kvariati are becoming elite recreation zones with clean sea water, attracting a more solvent audience, which positively impacts the ROI of Georgian real estate.
Real estate investment is a marathon, not a sprint. To reach the finish line with a profit, you need a reliable partner who knows the track.
To see our catalog, just click the button below
There is also growing demand for properties with gas heating. This is critical for winter rentals. An apartment with central heating rents for twice as much and much faster in winter than one where heating relies solely on air conditioning.
Another trend is the rise of the suburbs. Gonio and Kvariati are becoming elite recreation zones with clean sea water, attracting a more solvent audience, which positively impacts the ROI of Georgian real estate.
Real estate investment is a marathon, not a sprint. To reach the finish line with a profit, you need a reliable partner who knows the track.
To see our catalog, just click the button below
FAQ
1. What is the payback period for an apartment in Batumi in 2026?
A realistic payback period for a quality object with competent management is between 8 and 10 years. Indicators of 4–5 years, often promised in advertisements, are possible only with a speculative strategy (buying at the excavation stage and selling at the peak) or in exceptional cases, but they are not the norm for the rental business.
2. What is the average ROI of Georgian real estate today?
The Net Yield of residential real estate in Batumi varies between 7–11% per annum in foreign currency. This is still significantly higher than in Europe (3–5%) or bank deposits, making the Georgian market attractive for capital preservation and growth.
3. What determines the rental yield of a specific property?
Key factors:
Location and View: Front line and sea views increase the average check by 20–30%.
Infrastructure: The presence of a pool, SPA, and reception ensures occupancy during the off-season.
Quality of Management: A professional management company can squeeze the maximum out of a property, while poor management will lead to downtime and losses.
A realistic payback period for a quality object with competent management is between 8 and 10 years. Indicators of 4–5 years, often promised in advertisements, are possible only with a speculative strategy (buying at the excavation stage and selling at the peak) or in exceptional cases, but they are not the norm for the rental business.
2. What is the average ROI of Georgian real estate today?
The Net Yield of residential real estate in Batumi varies between 7–11% per annum in foreign currency. This is still significantly higher than in Europe (3–5%) or bank deposits, making the Georgian market attractive for capital preservation and growth.
3. What determines the rental yield of a specific property?
Key factors:
Location and View: Front line and sea views increase the average check by 20–30%.
Infrastructure: The presence of a pool, SPA, and reception ensures occupancy during the off-season.
Quality of Management: A professional management company can squeeze the maximum out of a property, while poor management will lead to downtime and losses.
Contact Us
Get in touch with us by phone or via messengers for a consultation and help choosing the right property.
+995 557 326 104
cappuccinoestate@gmail.com
cappuccinoestate@gmail.com
Georgia, Batumi
