Investment in real estate is a common way of gaining a long-term interest and obtaining passive income, in Georgia it might even become a basis for obtaining a residence permit and even citizenship. The acquisition of real estate in large cities and tourist centers along with the popular resorts is the trend of our time. Georgia with its reputation of a must-visit destination and unique tourist attraction all year round is holding is among the leaders of this trend. The number of real estate transactions concluded by foreigners is growing in Georgia by 40-50% annually.
The districts of highest demand for apartments in Tbilisi are Old City, Vake and Saburtalo. Depending on the location of the apartment, you can choose a long-term or daily rent, arrange a hostel or even an apart-hotel. Fans of outdoor activities bet on ski resorts Gudauri and Bakuriani, as well as the coastal cities of Batumi, Chakvi and Kobuleti. If we talk about business interests, land in the resort areas and near Tbilisi is in high demand mostly for hotel and hospitality infrastructure construction, as well as land for organizing a production, including agricultural land. The procedure for agricultural land acquisition differs from the procedures for other land categories since non-Georgian citizens are prohibited from purchasing and owning the agricultural land.
Georgia attracts foreign investors not only because of its geographical location and tourism potential. Let’s take a closer look at the advantages of investing in real estate in Georgia:
- Safety. According to NUMBEO rating Georgia is in top 5 safest countries in the world.
- Legality. According to the results of World Justice Project research, Georgia ranks first among the countries of eastern Europe and central Asia in terms of the rule of law.
- Preferential taxation. If your annual family income in Georgia is less than 40,000 GEL, you do not pay property tax. In general taxes in Georgia are not burdensome. If you look at the research results, Georgia holds the 9th place in the world in the ranking of countries with the lowest taxes.
As in any business there are many pitfalls in the process of acquiring real estate, and the seemingly easy registration of property rights in Georgia may turn into a serious issue in the future. Background checks on property and seller before transferring the money, choosing an optimal transaction structure and further tax scheme, including all essential conditions in a contract taking into account the specifics of Georgian legislation, taking care of the post-sale procedures, such as reconstruction of an object, changing the category of land, conclusion of a lease agreement, etc. – these are the issues that every serious investor thinks about in advance.
Our JUST Advisors team here in Georgia is ready to cover all those head-spinning list of issues for you. We have developed an algorithm that helps our clients to make no-headache real estate deals. And here it is:
- Legal due diligence of the Seller and the property.
- Assessment of the tax consequences for client’s business in case the property is acquired and used, and suggest options for acquiring it.
- Structuring of the deal for real estate acquisition, including preliminary purchase agreement, mortgage, encumbrance of an object with obligations in favor of the Buyer, and in case when the property is not registered in the ownership of the Seller or is under encumbrance;
- Structuring of the lease/rent agreement of real estate, including assessment of the tax consequences of the transaction;
- Legal support and control of all real estate transactions in the Public Register;
- Tax registration (as a recipient of income on the territory of Georgia) in the Revenue Service of Georgia.
- Accurate accounting of income generated by your property in Georgia, preparation and submission of an annual tax return;
- Obtaining necessary certificates for the tax service in your country of residence at Revenue Service of Georgia;
- Consulting and supporting the procedure for obtaining a residence permit in Georgia through the ownership of real estate.
In case you have already bought real estate, and during its’ use and operation some unexpected issues have arisen – our litigation practice is at your service.
JUST Advisors has established long-term partnerships with certified auditors, appraisers, industrial safety specialists, designers, cadastral engineers, and real estate brokers.
Message us, and get detailed answers to all of your legal questions! We are here to help you in Georgia!