Does Rent Control Exist in Georgia?
The honest answer to the question in the title is: state-imposed rent control does not exist in Georgia. Under a lease agreement the lessor must transfer the thing to the lessee for use for a defined term and the lessee must pay the agreed rent, while the amount of the rent, its increase and indexation are matters for the parties’ agreement. In this field, compliance therefore does not mean administrative capping, but the correct application of the contractual rules.
Contractual freedom is not absolute, however. The Civil Code chapter on lease contains several active restrictions that genuinely constrain rent-related relationships: the cap on the lessee’s security in the lease of a dwelling, the time limit for demanding continuation, the termination notice period, and the grounds for terminating the lease of a dwelling. Knowledge of these rules is precisely the „control“ that applies in a rent dispute.
The Cap on Security in the Lease of a Dwelling
Where a lease agreement for a dwelling imposes on the lessee the obligation to provide security for performance, the amount of the security may not exceed three times one month’s rent. Where a sum of money is payable in advance, the lessee is entitled to pay it monthly in equal instalments over three months. Interest fixed by law must accrue on the security paid in advance, and upon the end of the lease relationship it must be returned to the lessee together with the interest. Any contrary agreement to the detriment of the lessee is void.
This norm is a practical instrument where a lessor demands several months’ rent as a deposit: the lawful cap is the equivalent of three months’ rent, and an agreed deposit cannot exceed it to the lessee’s detriment. The return procedure is also defined: after the end of the lease relationship the sum is returned to the lessee together with the accrued interest. For the lessor this means that a deposit cannot be treated as income and its unjustified withholding becomes the subject of the lessee’s claim.