Record growth in the construction and renovation materials market – what is driving sector dynamics in Georgia

The year 2024 is a year of true records for Georgia’s construction and renovation materials market: annual revenues reached 5.7 billion dollars, which is an almost 10% increase compared to the previous year. Several strong economic and social trends stood behind this dynamic — including the development of construction, growth in real estate sales, and a new wave of urbanization. It appears that Georgia’s construction boom is taking on broader contours, and this process is accompanied by rising demand for materials and related sectors.

The market structure varies by segment: the largest share belongs to renovation materials, where revenues reach 2.5 billion dollars, while in the construction materials subsector this figure equals 2.1 billion dollars. Revenues in household appliances and furniture segments are relatively smaller, although their share has been growing steadily year by year.
The role of local production is particularly important in the field of construction materials, where almost two-thirds (66.7%) of sales come from products made in Georgia. This is primarily due to high transportation costs and the economic unfeasibility of imports. In contrast, the share of imports is very high in the renovation materials and furniture markets: 82.3% in renovation materials and 76.7% in furniture. Local production is hardly recorded in household appliances — in this area the market is entirely dependent on imports, with the only exception being water heaters, which are mostly exported.

In the geographical distribution of imports, Turkey leads — almost one-third of construction and renovation materials come from this country. China’s share is 19.2%, and 10.2% comes from Russia. Iran, Azerbaijan, Italy, and Germany are also significantly represented. Such diversity also affects market pricing: due to high dependence on imports, renovation materials prices were relatively volatile and responded more quickly to changes in international factors, while construction materials prices grew more steadily and consistently.
It is important that both the growth of local production and the diversification of imports become long-term strategic advantages for the country. At the same time, the growth in market volume is driven not only by the current construction boom but also by increasing demand in the household segment for modern, high-quality materials and furniture. Added to this is the fact that against the backdrop of record construction permits and real estate sales in Georgia, the trend of growing demand for construction and renovation materials will continue in the future.
Thus, the construction and renovation materials sector is becoming one of the most dynamic and rapidly growing directions in the Georgian economy. This is not only a real increase in construction and renovation statistics but also a significant trend for the economic structure, market demand, and long-term strategic development.