Acquiring Real Estate as a Foreigner: the Legal Basis
In Georgia the acquisition of real estate by a foreigner takes place within the same civil-law framework that applies to local buyers: the transaction is concluded in written form, and the right of ownership passes through registration in the public registry. Acquiring an immovable requires the conclusion of the transaction in written form and the registration, upon the acquirer, of the right of ownership defined by that transaction in the public registry. This requirement extends to every acquirer, and where it is violated the transfer of ownership does not take place.
At the same time it must be said plainly: civil legislation generally treats the acquisition of property by foreigners as permitted, although for individual categories — agricultural land, for example — restrictions may be established by special legislation. The content and scope of such restrictions are determined precisely by those laws, and taking them into account before the transaction is essential. Before each concrete acquisition it is therefore necessary to check whether a special rule applies to your object.
The Content of the Contract of Sale
A contract for the disposal of immovable property requires written form: a contract by which one party undertakes to transfer ownership of an immovable to another, or to acquire it, requires written form. Under the contract of sale the seller must transfer to the buyer the right of ownership in the property, hand over the documents associated with it and deliver the property, while the buyer must pay the agreed price and accept the purchased property.
If the price is not directly indicated in the contract, the parties may agree on the means of determining it. For a foreign buyer it is important that the method of payment, the currency and the moment of payment be reflected precisely in the contract — the details connected with international payments most often break down exactly in these elements.
The Public Registry and the Presumption of Reliability
The public registry is the unified body of data on rights over things and non-material property values, on the creation of pledges and of tax liens or mortgages, changes therein and their termination, and likewise on the abandonment of ownership of an immovable and changes therein. The registry thus gives a unified picture of who holds which right and which encumbrance over the property — and precisely for that reason checking it is an indispensable step of every transaction.
Registry data are subject to the presumption of reliability and completeness: registry entries are deemed correct unless their inaccuracy is proven. This presumption is the foreign buyer's principal protection: it may rely on the data contained in the registry, and any doubt about the correctness of an entry must be proven.
The protection of the good-faith acquirer is particularly important: in favour of a person who acquires a right on the basis of a transaction from a person in whose name that right was registered, the entry is deemed correct, unless a claim has been filed against it or the acquirer knew of its inaccuracy.
The law also protects the stability of the transaction: where an owner disposes of real estate or encumbers it with a right, it is impermissible to demand the consent of a co-owner upon conclusion of the transaction where that co-owner is not so registered in the public registry. From the standpoint of the acquirer's interests, the disposer is deemed the sole owner where it is so registered in the public registry, except where the acquirer knew that besides the disposer another co-owner exists. Extracting a registry excerpt before the transaction practically eliminates these risks.
The Special Rule for Disposing of a Child's Property
If the property to be acquired is registered in the ownership of a child, the seller acts only through its parent or other legal representative: the disposal of an immovable held in a child's ownership by its parent or other legal representative is permissible in accordance with the best interests of the child and on the basis of a court's consent. For the buyer this means that in such a transaction the representative authority and the court's consent must be verified.
A Practical Checklist for the Foreign Buyer
In practice, the acquisition of real estate by a foreigner is planned in the following steps: first a registry excerpt and the disposer's authority are checked; then a written contract is drawn up with a precise stipulation of the price and the method of payment; next the parties jointly apply to the registering body; and finally the buyer receives the documents and the property. The completeness of the documentation at each stage determines the safety of the transaction.
If you are planning to purchase real estate in Georgia, checking the special restrictions, structuring the contract correctly and conducting the registration process are precisely the three pillars on which a safe transaction stands.
Frequently asked questions
What form is required for disposing of immovable property?
A written form, and the acquisition of ownership on the basis of the transaction must be registered in the public registry — without registration no right arises.
May a registry entry be relied upon?
Yes — an entry is deemed correct unless its inaccuracy is proved; in favour of the acquirer it is correct unless a complaint has been entered against it or the acquirer knew of its inaccuracy.
When is a co-owner’s consent required?
Only where the co-owner is registered as such in the public registry — relying on an unregistered co-owner when concluding the transaction is inadmissible.
How We Help on Legal.ge
The Legal.ge team will support you through the full process of acquiring real estate — from checking the registry and drafting the contract to completing the registration.