CHATTANOOGA MARKET REPORT

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OVERVIEW

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BJ Gremillion & Brad Young, owners of Property Rush, have been investing in real estate since 2008. During this time, they have successfully expanded the business into 5 markets to include Arizona, Tennessee, Michigan, Alabama and Georgia.

When it comes to investing in a new market, ideally, you want to focus on regions that boast growing, diversified economies with a business-friendly regulatory climate. We believe that the surrounding Chattanooga area meets these criteria, as evidenced below. Chattanooga is a fast-growing city that sits in the Southeast corner of the state, just across the border from Georgia. Chattanooga sits on the junction of four interstate highways and the Tennessee River, making it a prime location for several industries, including manufacturing, logistics, and resource extraction outfits- among others. The city’s downtown “shines” partially as a result of a successful public/private redevelopment program and widespread civic and community engagement is the future of the city. Chattanooga is home to Volkswagen, who employs approximately 3800 people with plans of developing another plant in Chattanooga to focus on the rising demand for electric vehicles.

The local real estate market in Chattanooga remains rock-solid. According to statistics collected by the Greater Chattanooga Realtors Association, as of December 2021, the region saw a 9.9% increase in closed sales, a -48.8% drop in days on market, and a 7.7% rise in new listings over the past year. Inventory levels in the city are also dropping, -36.2% change in a single year. The city’s real estate market remains affordable, with the average home price sitting at $265,000, an increase of 15.2% over 2020. Chattanooga and surrounding areas have a healthy rental market, with rental rates averaging approx $2000 per month for a 3 bedroom home.

PROPERTY HIGHLIGHTS

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3806 Brock Rd, Chattanooga, TN 37421

4 bd 3 ba 2,569 sqft

Purchase price: $255,000 (11/1/21)

Estimated ARV: $320,000

Actual rent: $2,250

Actual rehab costs: $18,000

CAP rate: 8.35%

Cash on cash return:

Year built: 2005

Property type: Single Family

Lot: .41 acres

Neighborhood: No HOA

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3635 Missionaire Ave, Chattanooga, TN 37412

5 bd 3 ba 2,436 sqft

Purchase price: $245,000

Estimated ARV: $320,000

Actual rent: $1,050 2/1 and $1,400 3/1

Actual rehab costs: $5,000

CAP rate: 7.98%

Cash on cash return:

Year built: 1964

Property type: Duplex

Lot: .23 acres

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2549 and 2555 Ocoee St, Chattanooga, TN 37406

3 bd 2 ba 1,145 sqft

*New construction home next to each other*

Purchase price: $177,500 each

Estimated ARV: $190,000

Actual rent: $1,500

Actual rehab costs: $0

CAP rate: 7.5%

Cash on cash return:

Year built: 2022

Property type: Single Family

Lot: .09 acres

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1407 Clearpoint Dr, Hixson, TN 37343

3 bd 3 ba 2,187 sqft

Purchase price: $220,000

Estimated ARV: $300,000

Actual rent: $2,300

Actual rehab costs: $25,000

CAP rate: 7.68%

Cash on cash return:

Year built: 1960

Property type: Single Family

Lot: .3 acres

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806 Forest Dale Ln, Hixson, TN 37343

6 bd 4 ba 2,622 sqft

Purchase price: $320,000

Estimated ARV: $325,000

Actual rent: $3,000

Actual rehab costs: $0

CAP rate: 8.44%

Cash on cash return:

Year built: 1972

Property type: Duplex

Lot: .23 acres

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1132 Highland Dr, Chattanooga, TN 37405

3 bd 2 ba 1642 sqft

Purchase price: $300,000

Estimated ARV: $425,000

Estimated rent: $2,500

Actual rehab costs: $40,000

CAP rate: 7.10%

Cash on cash return:

Year built: 1925

Property type: Single Family

Lot: .21 acres

Neighborhood: North Shore (HIGHLY DESIRABLE)

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303 Windmere Dr, Chattanooga, TN 37411

3 bd 2.5 ba 2213 sqft

Purchase price: $302,000

Estimated ARV: $340,000

Estimated rent: $2,400 

Actual rehab costs: $7,500

CAP rate: 6.38%

Cash on cash return:

Year built: 1963

Property type: Single Family

Lot: .28 acres

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5056 Eller Rd, Chattanooga, TN 37416

3 bd 2.5 ba 1612 sqft

Purchase price: $200,000

Estimated ARV: $275,000

Estimated rent: $2,000 

Actual rehab costs: $16,000

CAP rate: 7.75%

Cash on cash return:

Year built: 1964

Property type: Single Family

Lot: 3.67 acres

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4715 Oakland Ave, Chattanooga, TN 37410

3 bd 1 ba 1184 sqft

Purchase price: $100,000

Estimated ARV: 130,000

Actual rent: 

Actual rehab costs: $8,000

CAP rate: 7.56%

Cash on cash return:

Year built: 1930

Property type: Single Family

Lot: .17

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52 Wilburger St, Rossville, GA 30741

2 bd 1 ba 756 sqft

2 bd 1 ba 1274 sqft

*2 Homes on one lot

Purchase price: $127,500 

Estimated ARV: $200,000

Estimated rent: $1,800

Actual rehab costs: $12,000

CAP rate: 11.16%

Cash on cash return:

Year built: 1937

Property type: Single Family

Lot: .22

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