A view of Gyumri, Armenia's second largest city - © VittoriaChe/Shutterstock

A view of Gyumri, Armenia's second largest city - © VittoriaChe/Shutterstock

Injection of new money into local economic systems, inflation of the real estate market, inaccessible rental houses: the Russians on the run are already changing the Armenian and Georgian economies

07/10/2022 -  Armine Avetisyan

Tens of thousands of people have moved from Russia to Armenia and Georgia in recent months, with the inflow increasing in the last 10 days. There is already a measurable economic impact on the two countries.


In recent days, Yerevan's Zvartnots International Airport has handled an overload in flight scheduling. After the mobilisation announced by Russia, hundreds of Russians have hurried to move to Armenia.

“My family has already been in Armenia for several months, I have always postponed my own departure, but I had no other options”, says Pyotr, who arrived in Yerevan a few days ago.

The first anomalous flow of Russian citizens into Armenia was recorded in March of this year, driven by the beginning of the Russian-Ukrainian conflict. According to data provided by the Armenian Migration Service, 372,086 Russian citizens arrived in Armenia between January and June. For comparison, in the same period of 2021, there were 159,466. Not everyone comes to stay but, from one year to the next, the number of those who remained has also increased considerably.

At the moment the Armenian authorities provide the data only for the first half of 2022, but it is now clear that the second half will mark a further increase.


In 2022, when compared with 2021, the prices of apartments for sale in Armenia increased significantly. Over the course of a year, the price per square metre of apartments in the centre of the capital rose by an average of 109,000 drams (about 273 Euros).

Rental prices have also risen. In the down-town administrative district of Kentron, if last year a furnished two-room apartment could be rented for around 500 Euros, now the price has increased by at least 50%.

According to economist Samson Grigoryan's estimates, it was the Russian-Ukrainian war that had a major impact on Armenia's real estate market.

"Each human flow contributes to price fluctuations. It also has its positive side – it contributes to the development of the regions – because Yerevan cannot accommodate everyone, so others will also go to other regions of the country", wrote Grigoryan.

After the capital, the Russians' favourite city is Gyumri, in the Shirak region. It is the second largest city in Armenia with around 100,000 residents. As in Yerevan, inflation has already hit the real estate market here.

“I used to live in a two-room apartment on the outskirts of the city and paid 100 Euros. It was a common figure for Gyumri. Today, there is no longer any house at that price, or even available houses at all”, says Karen Sahakyan, who has been looking for an apartment in Gyumri for a month.

Karen had recently moved from her previous apartment due to the increase in the rental price. A month ago, the owner told her to pay twice the rent or leave the house.

“The homeowner came and told me I should be grateful to him for not raising the price since last March, as many have. I couldn't pay at that time, so I left the house. But this new influx of Russians shows that I won't find an affordable apartment for a long time”.

"Real estate inflation is, of course, negative, but this influx of people also has its positive effects", says Liza Gasparyan, Gyumri’s tourism specialist.

According to Gasparyan, the guests have increased the city's activities. She notes that if Gyumri was crowded on public holidays, today the bars in the city are full every day.

“Gyumri is a tourist city, but it is the internal tourism that is developed here. However, the image of the city has changed in recent months. There are guests from Russia, Belarus, and Ukraine. We all love peace. We will welcome anyone, so that peace reigns”.


A similar situation can be found in Georgia. A large number of citizens of the Russian Federation have arrived and there has been significant inflation in the real estate market.

According to Georgian NGO IDFI , from the start of the war in Ukraine up to June 49,505 Russian citizens settled in Georgia: they rented apartments mainly in large cities, obviously including the capital Tbilisi and then Batumi, Kutaisi, and Rustavi.

Almost all of Georgia's universities are located in these cities.

Lika comes from the Imereti region and started her studies this year, but she cannot find an apartment to live in with her friends.

"This year I was admitted to the University of Business and Technology, but I cannot find an apartment. Many students have this problem. Some homeowners say they do not want students. Given the increase in prices, we have decided to get together, in 4, but some people do not want to rent to so many people. We have been looking for a month and we have not found anything. I am not losing hope yet, but I even thought about taking a 'gap year' and continuing my studies later", Lika says.

The increase in rental prices is confirmed by data from the National Statistical Institute of Georgia, according to which, in August, compared with the same period of the previous year, state revenues from rent taxes increased by 22.5%.

What will be the effect of the recent new influx on prices in the coming months? How and how much will housing availability change? For now, the experts are not making any predictions.

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