Chattanooga Rentals: How to Profit


Forums featuring nonlocals asking if Chattanooga’s Rental market is “too good to be true“, are a common occurrence. It is no wonder so many people are looking to buy rental properties in Chattanooga. The question so many come back to is, “What is a good area for a rental property?”

Your Market

When asking where to buy, the focus should be on who is renting units. Around 51% of housing units are renter-occupied, so the area you choose will greatly affect who your possible renters are. 16% of the Chattanooga area populace is 20-29 years old with the next largest segment being 30-39 years old at 14% according to the 2017 census.

Given this distribution, the homes you look to purchase should keep in mind the habits of this demographic. If you are wanting the largest population groups, you will want to buy in areas with short commute times to the downtown area. The closer to the downtown area you can manage, the higher the rent you will be able to charge.


The Area

For a high return on your investment, places like East Ridge, Red Bank, and North Chattanooga are all great areas. This will attract a demographic that ranges from 20-39 years old while keeping your initial investment down (zipcodes 37404,37411, 37412 and 37415).

For a more stable and consistent invetment, you may want to look at East Brainerd area and Northshore. Northshore is a higher investment but will continue to prosper due to its proximity to downtown and its school district. East Brainerd will not vary much in price but is near many large job providers.

Two other areas of interest are Hixson, which can be close to the downtown depending on the part of Hixson, and Ooltewah. Ooltewah has a very desirable public school but the market might keep those wanting the school district locked out of buying their own home. This gives landlords an opportunity to expand in this region.

Local Insight

Many outside investors find themselves romanced by the 37406 prices of homes. While we don’t discourage purchasing homes in the area, keep in mind these areas have risks. Our growing city has yet to address many income gap issues and this is an area that suffers from that. It is a zip code that must have feet on the ground to inspect and decide upon its economic potential. This is only said as a word of caution. People were skeptical of Highland Park just two years ago, now it is one of the hottest neighborhoods in the Downtown area.

Rental Mistakes

Regardless of where you buy, it is important to avoid the two most painful mistakes many landlords make:

  1. Charging too much for rent
  2. Not purchasing background checks

All of these mistakes can be avoided if you choose to work with a realtor to get your rental property a tenant. We not only help Rental Property investors find their property, but we also help them fill that property with good tenants. Local insight and experts will help you list your property correctly, we are happy to help!

Need help finding great rental properties? Sign up for our email list to help you find the best properties BEFORE they hit the market.

If you are wanting to learn more about what sort of responsibilities Landlords in the Chattanooga area have to their tenants and property, check out this great resource by the Chattanooga Neighborhood Enterprise.

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