Tbilisi Under Pressure: Digital Nomads, the Housing Market, and New Opportunities

When Georgia opened its doors to digital nomads with ultra-liberal visa rules and exceptionally low taxes, Tbilisi quickly rose to prominence as one of Eastern Europe’s most attractive hubs. The city’s combination of bohemian old quarters, fast-growing café culture, reliable internet, and one-year visa-free stay for over 90 nationalities made it an ideal base for remote workers. For locals, the shift was visible in everyday life: Vera’s cafes filled with laptops, coworking spaces multiplied, and landlords discovered a lucrative new class of tenants willing to pay significantly more than Georgians could afford.

But what began as an economic windfall has also created serious structural strains. The most acute is in the housing market. Following Russia’s invasion of Ukraine in 2022, tens of thousands of Russians, Belarusians, and Ukrainians relocated to Georgia. Many were remote professionals and immediately sought apartments in Tbilisi. Demand spiked almost overnight. By the end of 2022, rents in the capital had soared by over 60%, marking the steepest increase on record. Districts like Vake and Saburtalo, once accessible to middle-class Georgian families, suddenly commanded rents of $600–800 a month for modest one-bedrooms — figures that might still seem affordable to a Western freelancer earning €4,000, but are punishing for a local teacher or civil servant.

For digital nomads, Tbilisi remains inexpensive. Compared to Lisbon or Berlin, where central apartments can cost double or triple, Tbilisi’s housing market still looks like a bargain. But the local perception is very different. For Georgians, who earn on average around 1,300–1,500 GEL a month (roughly $500), these rents are devastating. The imbalance is creating resentment, with many locals forced to move further from the city center or share space with extended family.

Lisbon’s experience offers a stark warning. Portugal’s capital was transformed by digital nomads and expats drawn by generous tax breaks (like the Non-Habitual Resident regime) and booming short-term rentals. While it became Europe’s “nomad capital,” it also became Europe’s most unaffordable city. Housing costs skyrocketed beyond the reach of ordinary Lisboetas, sparking protests and fueling political shifts. Tbilisi is not yet at that stage, but the trajectory is uncomfortably familiar: rapid inflow, overheated rental market, locals squeezed out.

Yet the story is not all negative. Digital nomads inject significant spending into Tbilisi’s service economy. Cafés, gyms, restaurants, and supermarkets have benefitted from higher daily consumption. Coworking hubs like Fabrika and Impact Hub thrive on the new clientele. For many small businesses, the influx has been a lifeline. Landlords, construction firms, and real estate agents are enjoying a boom, with cranes dotting the skyline as new apartment blocks rise. In some ways, digital nomads have turned Tbilisi into a more dynamic, cosmopolitan city — one with a richer startup scene, more international connections, and new forms of cultural exchange.

Policy is at the heart of the matter. Georgia offers one of the most generous immigration regimes in the world: most foreigners can stay for a full year visa-free, then reset their stay with a border run. On top of this, the tax system is highly attractive: registering as an Individual Entrepreneur with “Small Business Status” allows nomads to pay just 1% income tax on revenues up to $165,000. This model has drawn thousands of freelancers and entrepreneurs to formalize businesses in Georgia. But the state collects relatively little revenue from these workers, while locals bear the brunt of rising living costs.

The question is whether Georgia can balance opportunity with equity. Tallinn offers one contrasting model: Estonia launched the world’s first Digital Nomad Visa, requiring proof of high income, charging regular taxes after six months, and integrating nomads into the system with transparency. Fewer nomads come to Tallinn than to Tbilisi, but those who do are carefully vetted and contribute more directly to public finances.

Tbilisi must find its middle ground. Lean too far toward laissez-faire and the city risks a Lisbon-style housing crisis. Clamp down too hard and Georgia could lose its competitive edge. The opportunity is clear: if Tbilisi can channel digital nomads’ spending into broader benefits — by encouraging housing supply, ensuring locals have affordable options, and gradually adjusting tax frameworks — it could become one of the world’s most sustainable hubs for remote professionals. The stakes are high: will Tbilisi remain a balanced, livable city for Georgians while staying a magnet for global talent?