Georgia · Risks · 4 min
Georgia: Buying Off-Plan Without Escrow - How to Reduce Your Risk
Georgian law does not require escrow for the sale of homes under construction: the buyer’s money goes directly to the developer. Buyers must assemble their own protection through milestone payments, preliminary registration of rights with NAPR, and checks of construction permits.
Key figures
What are the risks?
When buying an apartment under construction, the buyer pays a private company in instalments in exchange for a promise to build the property. There is no mandatory escrow, bank guarantee, or completion insurance. A developer may offer these voluntarily, but most do not (ProfitKey Properties). The main risks are delays, changes to the project, the same apartment being sold twice, and the developer going bankrupt.
The market is substantial: more than 17,000 transactions were registered in Batumi in 2025 (ProfitKey Properties). Without escrow, in a worst-case scenario the buyer becomes one of the developer’s creditors rather than the owner of funds held in a protected account.
Preliminary registration with NAPR
Article 12 of Georgia’s Law on the Public Registry allows a right to real estate to be preliminarily registered on the basis of an agreement between the parties. This registration prevents any other right to the property from being registered, unless the parties agree otherwise, and is removed when the ownership right itself is registered (Matsne).
In practice, this protects against the same apartment being sold again. Registration of a right or obligation with NAPR costs 150 GEL within 4 working days, 270 GEL within 1 day, or 350 GEL on the day of submission (NAPR). Include in the contract the developer’s obligation to sign the documents needed for registration.
Preliminary registration does not make you the owner and does not return your money if the developer goes bankrupt. It addresses one specific risk: it prevents the same apartment from being sold or transferred to someone else. That is why it should be combined with a payment schedule and permit checks.
Milestone payments
Without escrow, the main safeguard is a payment schedule tied to visible construction milestones (structural frame, roof, facade, completion), rather than calendar dates. A large payment at the excavation stage means maximum exposure to a single developer. Check the contract separately for:
- the completion date and any grace period for delays;
- late-delivery penalties and the right to terminate the contract and receive a refund;
- the right to suspend payments if construction stops;
- permitted changes to the area and layout, and how the price will be recalculated.
Checking permits and land ownership
The permit must have been issued to the same company that is selling the apartment, and must cover the same plot of land identified in the contract.
An NAPR extract for the plot can be ordered online using its cadastral code. Published decisions by Tbilisi’s Architecture Service show the order number and date, the plot’s cadastral code, and its registered owners. This provides a second check that the permit and land belong to the seller (Reestri).
- NAPR extract for the plot: owner, mortgage, seizure, and restrictions;
- construction permit: number, date, and issuing authority. In Tbilisi, check the Architecture Service (tas.ge) and published decisions on docs.tbilisi.gov.ge, which show the plot owner; in Batumi, check with the municipality (Reestri);
- whether the permit matches the property being sold: number of floors, address, and cadastral code;
- in Tbilisi, check the municipal map showing projects where construction has been suspended by the Municipal Inspectorate (Georgia Today);
- the seller company’s entry in the business register and its track record of completed projects.
Steps to take
Start with the extracts and permit, then make a reservation. The contract should include a milestone-based payment schedule and a clause on preliminary registration. Register with NAPR immediately after signing, before making the main payment.
If the developer refuses to register the contract or tie payments to milestones, that does not necessarily mean the developer is acting in bad faith, but it does increase the risk, which should be reflected in the price. Compare not only the price per square meter, but also how well the contract protects the buyer.
A practical rule: if you cannot check the permit, extract, and payment schedule within a few days, do not rush to reserve the property. A discount for making a quick decision rarely compensates for the risk of paying for construction without the necessary documents.
This material is for general information only and is not legal or tax advice. The terms should be checked for the specific property before proceeding with a transaction.
What this means for buyers
- There is no escrow in Georgia - the money goes directly to the developer.
- Preliminary registration with NAPR prevents the same apartment from being sold again.
- Pay according to construction milestones, not a calendar schedule.
- Check the permit by its number in the official register, not against a copy.
Current as of . This is general information, not legal or tax advice.
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