What is a developer instalment plan?
Many Georgian developers sell flats in buildings under construction on a payment plan of their own: a down payment, then monthly or quarterly instalments over two to three years, often without interest, and sometimes a final balance that the buyer refinances with a bank when the building is finished. For a foreign buyer who cannot get a Georgian mortgage easily, it looks like the simplest way to buy. It can be, but an instalment plan is a private contract with the developer, not a bank loan, and the protections that come with a bank loan do not come with it.
This guide explains how the plans usually work, what a former Vice Governor of the National Bank has said about them, the risks for the buyer, the clauses that make a plan safer and how to compare it with paying in full.
How the plans usually work
| Feature | What is common |
|---|---|
| Down payment | Offers range widely, with some as low as 0%; examples in Batumi often ask 10-30% |
| Length | Two to three years is common; some advertised plans run 24 to 60 months |
| Interest | Usually advertised as interest-free |
| Currency | Mostly in foreign currency, usually dollars |
| End of the plan | The last payment at handover, or a balance refinanced by a bank |
"Interest-free" rarely means free. The cost of time is often built into a higher price than the developer would accept for a payment in full. That is why the first number to ask for is the cash price of the same unit.
Not a bank loan: what that means
In October 2026, Otar Nadaraia, a former Vice Governor of the National Bank of Georgia, described these plans as quasi-mortgages and pointed to gaps in how they are treated:
- No payment-to-income limits. The National Bank's rules that cap a borrower's payments as a share of income apply to banks, not to developers.
- No duty to show an effective rate. Banks must disclose the effective interest rate; developers do not.
- Possibly no credit bureau record. The obligation may not appear in credit reporting, so lenders can underestimate a buyer's total debt.
- Exit clauses. Some contracts let a buyer walk away by paying a penalty, which can return many units to a developer at once in a downturn.
Georgia also has no special law on shared participation in construction. The relationship between buyer and developer is governed by the Civil Code and the contract, and there is no statutory penalty for a developer's delay: only what the contract says.
The risks for the buyer
- Paying for a flat that is not yet yours. Until ownership of the finished unit is registered, your protection is the contract and, if you register it, a preliminary ownership right.
- Delay without compensation. Without a penalty clause, a late building costs you time and gives you nothing.
- Currency. A plan in dollars paid from lari, or in lari paid from another currency, carries exchange-rate risk for its whole length.
- Refinancing that may not come. If the plan ends with a bank refinancing the balance, a bank's rules, which tighten from time to time, decide whether that happens.
- Penalties for a missed payment. Some contracts allow the developer to terminate and keep part of what you paid.
Clauses that make a plan safer
The full set of protective clauses is in our guide to the developer contract.
Instalments or payment in full?
To compare honestly, ask the developer for both prices for the same unit and work out the implied cost of the instalment plan. A simple test: if the cash price is lower by more than you could earn on the money over the plan's length, the instalment plan is costing you. Our instalment calculator shows the total paid and the schedule; add the cash price beside it.
| Situation | Instalments | Payment in full |
|---|---|---|
| Money arrives over time (salary, sale of another home) | Fits the cash flow | May not be possible |
| You have the money now | Pays for time you do not need | Often a better price per m² |
| Developer with a short record | Less money at risk early on | More money at risk before completion |
| You need a residence permit soon | The finished, registered unit comes at the end | Same: an off-plan unit is not yet a registered property |
Working out the true cost: an example
Take a unit offered at $90,000 on a 24-month interest-free plan with 20% down, or at $82,000 if paid in full. On the plan you pay $18,000 now and $3,000 a month for two years. Paying in full costs $82,000 today. The difference is that by taking the plan you keep $64,000 of the cash price in your pocket for a while, and pay $72,000 for that over 24 months. Expressed as a rate, that is roughly 1% a month, or about 12% a year, on the money you have not yet paid. Whether that is expensive depends on what your money would earn elsewhere and how much you value keeping it while the building is unfinished, but it is not "free".
The figures in this example are illustrative; use the developer's actual prices and our calculator for your own case.
Currency risk over the length of a plan
A plan in dollars paid from lari income moves with the exchange rate for its whole length. A $3,000 monthly instalment costs GEL 7,872 at 2.624 lari to the dollar and GEL 9,000 at 3.0. The lari has been as weak as 3.48 to the dollar in March 2020 and as strong as about 2.62 in August 2026, so a swing of that size within two or three years has happened before. A buyer whose income is in the plan's currency carries no such risk; anyone else should test the plan at a weaker rate before signing.
Questions to ask before you sign
- What is the price of this exact unit if I pay in full today?
- Which currency is each payment in, and what if I pay in another currency?
- Are payments linked to construction stages, and who confirms that a stage is complete?
- Will you register my preliminary ownership right, and how soon after signing?
- What happens if I pay late: is there a grace period, and what is the charge?
- What is the penalty if you deliver late?
- Can I pay off the balance early, and does the price then fall?
- Which buildings have you already finished, and may I speak to owners there?
If the developer runs into difficulty
Because Georgia has no special law on shared construction, a buyer on an instalment plan is, in legal terms, a party to a contract with the developer. If the project stalls, your position depends on that contract and on what is registered in your name. A registered preliminary ownership right puts your claim on the public record ahead of later entries; a contract with a refund clause and a delivery penalty gives you something to enforce. That is why both belong in the contract before the first payment, not after a problem appears.
Instalments and the residence permit
A flat bought on an instalment plan supports a residence permit only once it is a registered unit in your name and valued above $150,000 by an accredited assessor. During construction, the plan itself does not give a permit. If residence is part of your plan, count the years until handover and registration, and plan your stay in the meantime, for example on the visa-free year. Our residence permit guide explains the conditions.
Risks and exceptions
- An "interest-free" price above the cash price. Always ask for both.
- Calendar payments with no link to the works. You may pay most of the price before the building rises.
- No penalty for delay. Georgian law adds none if the contract is silent.
- Relying on refinancing. Have a plan if the bank says no.
Frequently asked questions
Are developer instalment plans regulated?
Not like bank loans. Payment-to-income limits and effective-rate disclosure apply to banks, not to developers.
Can a foreigner buy on an instalment plan?
Yes. The plan is a contract with the developer, so it does not depend on a Georgian bank's rules for non-residents.
Is the plan really interest-free?
Compare its price with the cash price of the same unit; the difference is the cost of paying over time.
What if I cannot pay an instalment?
The contract decides. Check the grace period and whether the developer may terminate and keep part of what you paid.
Can I sell the flat before the plan ends?
Only as the contract allows: many developers require their consent to assign the contract to a new buyer, sometimes with a fee. Ask before you sign.
Is a longer plan better?
Not necessarily. A longer plan lowers each payment but usually raises the total, and it leaves more of your money tied to a building that is not finished.
Can I register my right before the building is finished?
Yes, as a preliminary ownership right, for the registry's standard fee. Ask the developer to commit to it in the contract.
Sources
- Who can afford real estate in Tbilisi: mortgages, instalment plans and new regulations, Sovanews, 8 October 2026 (accessed 13 October 2026)
- Buying property in a new development in Georgia, Just Advisors, 15 April 2025 (accessed 13 October 2026)
- Civil Code of Georgia (Articles 417-420, penalties), Legislative Herald of Georgia (accessed 13 October 2026)
- Immovable property registration fees and terms, National Agency of Public Registry (accessed 13 October 2026)
Change log
- - Guide published from Sovanews (October 2026), Just Advisors, the Civil Code and the registry fee table.