Is it better to buy an apartment for long term leasing or short term rentals in Georgia?

One of the most common questions real estate investors ask when entering the Georgian market is whether it makes more sense to focus on long term rentals or short term daily rentals. On paper, both strategies look attractive. In reality, they behave very differently once you factor in occupancy, management effort, costs, and long term stability.

The right answer is not the same for everyone. It depends on your goals, your involvement level, and how much operational work you are willing to handle.

Short term rentals: higher income potential, higher operational load

Short term rentals, especially in tourist driven areas, can generate strong monthly income. In places like Batumi and Gudauri, it is not unusual for well located apartments to outperform long term rentals in gross revenue during peak seasons. At first glance, the math looks simple. Daily rates multiplied by high occupancy can significantly exceed a standard monthly lease. In some cases, short term rental returns can reach 8 to 15 percent annually, depending on property quality, management, and location. However, that is only part of the picture. Short term rentals come with seasonality. Batumi, for example, is heavily dependent on summer months. Gudauri is driven by winter tourism. This means there are strong income peaks followed by weaker or even low occupancy periods. If the property is not managed dynamically with pricing adjustments and marketing, annual performance can drop quickly. Then there is the operational side. Cleaning, guest communication, check ins, check outs, maintenance coordination, and constant restocking all add up. Even if you outsource management, costs are higher compared to long term leasing. Wear and tear is also more noticeable. Frequent guest turnover means more frequent repairs, replacements, and general upkeep. Towels, furniture, appliances, and finishes degrade faster when used by different guests every few days. So while short term rentals can generate higher gross income, the net result often gets adjusted downward once all costs are included.

Long term rentals: stability, consistency, and lower management effort

Long term rentals behave in a much more predictable way. In cities like Tbilisi, demand comes from locals, expats, students, and professionals who stay for months or even years at a time. The biggest advantage here is stability. Once a tenant is placed, occupancy is essentially guaranteed for the duration of the lease. There is no seasonal fluctuation, no daily management, and no constant turnover. Cash flow is more consistent, even if the headline return looks lower compared to short term rentals. Typical long term rental yields in Tbilisi are often in the 5 to 8 percent range, depending on property type and location. Another important factor is property condition. Tenants who commit to long term stays tend to treat the apartment more carefully. They personalize the space and generally have a stronger incentive to maintain it properly. If the tenant selection process is done correctly, repair frequency is significantly lower compared to short term rentals. Management is also much simpler. Instead of handling daily operations, you are mostly dealing with periodic check ins, maintenance requests, and rent collection. This makes long term rentals far more passive in nature.

The hidden reality: returns often balance out

A common misconception is that short term rentals always outperform long term rentals financially. While gross revenue is usually higher, net profit tends to converge more than people expect.

Short term rentals generate more income, but they also come with higher costs:

• Cleaning and turnover expenses

• Higher utility usage

• Increased wear and tear

• Management fees or your own time investment

• Vacancy risk during off season

Long term rentals generate less income, but also significantly lower expenses and much more stable occupancy. When everything is calculated properly, the difference in net return is often smaller than expected. In some cases, it becomes nearly equal once you factor in all operational costs and vacancy periods.

Which strategy makes more sense?

Short term rentals make more sense if:

• You are targeting tourist-heavy areas like Batumi or Gudauri

• You are comfortable with active management or professional property management fees

• You want to maximize income and are okay with seasonal fluctuations

• You can optimize pricing and occupancy strategies

Long term rentals make more sense if:

• You prefer stability and predictable income

• You want minimal involvement in day to day operations

• You are investing in residential cities like Tbilisi

• You value lower maintenance and longer tenant relationships

Final thoughts

There is no universal winner between short term and long term rentals. Both strategies work in Georgia, but they serve different investor profiles. Short term rentals are closer to a business. They require systems, attention, and active optimization, but they can produce strong returns in the right locations. Long term rentals are closer to a steady investment. They are simpler, more stable, and easier to scale with less operational stress. Most experienced investors eventually choose a mix of both, depending on property location and their own involvement level.

If you are considering a long term rental strategy, or need help finding ideal investment properties or managing tenants, you can contact us at any time at info@stratos.ge