The Complete Guide to Real Estate Taxes in Georgia: A Clear, Practical Overview for Property Owners and Investors

Georgia has rapidly transformed into one of the most attractive real estate destinations in Eastern Europe and the Caucasus. International buyers are drawn not only to the affordability of local property, the growing tourism economy and the transparent legal system, but also to the country’s exceptionally investor-friendly tax framework. Property registration takes a single day, there is no tax on the purchase of housing, and most foreign individuals are entirely exempt from annual property taxes. This combination makes Georgia stand out globally, particularly compared with countries where ownership is more expensive and bureaucratic barriers are higher.

Yet even with such favorable conditions, responsible investors must understand the full spectrum of expenses that accompany property ownership. Although the tax burden is comparatively light, there are logistical, administrative and operational costs that influence the final return on investment. Sea Inside, which works with international clients across Tbilisi, Batumi, Adjara and developing resort regions, notes that well-informed investors make more accurate financial decisions and avoid misunderstandings. That is why this guide analyses each stage in detail: purchasing, owning, renting and eventually selling real estate in Georgia.

1. Taxes and Expenses When Purchasing Real Estate in Georgia

One of the most attractive aspects of the Georgian real estate market is the complete absence of a property purchase tax. This is rare even among investor-friendly countries. While many jurisdictions apply immediate acquisition taxes—which can significantly increase upfront expenses—Georgia has intentionally removed this barrier to stimulate investment and development. For context, buyers in Armenia typically pay 2–4% on transactions, in Turkey 4%, and in Spain anywhere between 6% and 10%. Georgia’s 0% rate immediately reduces financial pressure on investors, particularly those purchasing high-value apartments, villas or commercial units.

What buyers do pay for is the property registration process. Georgia’s registration system is one of the fastest in the region, and the fees are symbolic compared with the efficiency of the service. A standard four-day registration costs 50 GEL. Investors who prefer faster processing may choose the one-day (150 GEL) or same-day registration (200 GEL). All registrations are done through the House of Justice, and buyers receive a legally binding digital ownership certificate stored in the national registry. The transparency of the system minimizes the risk of fraud and ensures a clear, public record of ownership.

Notary services are required only in specific cases and therefore do not burden the majority of transactions. However, when parties do not share a common language, when a representative signs on behalf of the buyer via power of attorney, or when minors or bank mortgages are involved, a notary becomes essential. This maintains legal clarity and protects both sides. Typical costs range from 200 to 500 GEL.

Foreign buyers sometimes underestimate translation and legal review expenses. While translations are relatively inexpensive (30–50 GEL for short documents and up to 120 GEL for full contracts), legal support from a qualified specialist offers a deeper layer of protection. In the primary market, legal risks are low due to standardized documents, but verifying payment schedules, penalties, delivery dates and obligations ensures a smooth purchase. Legal support usually costs between 300 and 800 USD and is highly recommended for foreign investors.

Summary of purchase-related expenses:

Developers may additionally charge administrative fees such as installment-plan setup, contract registration or bank transfer processing. These fees vary widely and should be verified before signing any agreement.

2. Taxes and Expenses During Property Ownership

Georgia does have an annual property tax, but for most foreign buyers it effectively does not apply. The tax is linked not to the property value itself, but to the total income of the owner’s household earned within Georgia. If domestic income does not exceed 40,000 GEL annually—which is usually the case for foreign investors whose earnings come from abroad—the tax remains zero. This structure was designed to support investment, stimulate development and encourage long-term ownership.

For individuals or entrepreneurs whose local income does exceed the threshold, the annual property tax ranges from 0.05% to 1%, depending on the municipality. Even in such cases, Georgia’s tax burden remains minimal compared with many Western economies.

Typical ownership expenses are provided below:

These costs create predictable financial obligations, which many foreign investors appreciate. The clear structure simplifies budgeting and long-term planning, especially for those managing multiple units for rental purposes.

3. Taxes on Rental Income

Georgia’s rental taxation is one of its strongest advantages. For individuals who rent out property without registering a business, the rate is a flat 5%. This simplicity makes compliance easy and reduces administrative burden. However, most investors operating multiple units choose to register as individual entrepreneurs (IE). Under this structure, the tax rate becomes only 1% of turnover for income up to 500,000 GEL per year — one of the most favorable regimes in the region.

Short-term rentals offer higher yields but come with specific tax considerations. If an investor’s turnover from short-term rental exceeds 100,000 GEL in a year, they become subject to VAT (18%). Below this threshold, VAT does not apply, and the 1% tax regime remains active. This framework encourages small and mid-scale investors while ensuring large operators comply with VAT legislation.

Investors should account for operational expenses such as cleaning, management and consumables, which influence net profitability more than taxes themselves.

4. Taxes and Expenses When Selling Property

Capital gains tax applies only when a property is sold within two years of purchase. The 20% rate is applied to profit — not to the full sale price — making the system fair and predictable. If the property is held for more than two years, capital gains tax becomes zero. This encourages mid-term investment strategies and allows owners to maximize value appreciation.

Renovation quality significantly affects selling price. New developments commonly deliver apartments as black frame or white frame, and renovation costs vary accordingly.

Other selling expenses include agency commissions (1–3%), notary fees when applicable, and occasionally valuation certificates if regulators request proof of market value.

5. Additional Expenses Often Overlooked

A crucial part of financial planning is estimating renovation, furnishing and management expenses. These items are frequently overlooked, yet they influence profitability more than taxes. Many investors purchasing units for short-term rentals choose turnkey renovation and furniture packages to accelerate launch timelines.

Before calculating projected returns, investors should ensure their financial model includes setup costs, ongoing operational expenses and the chosen tax regime. This approach helps evaluate true net income rather than theoretical yields.

Conclusion: Why Georgia Remains a Top Market for Property Investors

Georgia remains one of the most convenient and profitable real estate markets internationally thanks to its tax transparency, lack of purchase tax, zero capital gains tax after two years, low maintenance costs and favorable rental taxation. The system rewards long-term planning and provides legal clarity that many emerging markets lack.

According to Sea Inside, the most common mistakes made by foreign investors relate not to misunderstandings of tax laws, but to underestimating additional operational and renovation expenses. With proper budgeting and a clear understanding of the financial structure, investors can achieve strong and stable returns in Georgia’s rapidly expanding property market.