1921 Emerson Dr

Chattanooga, TN 37408

$850,000D

9 bd · 6.9 ba · 4,352 sqft · Built 1910 · MultiFamily · Pending · 140 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $6,287/mo
• Mortgage (P&I): −$4,457
• Tax + insurance: −$1,148
• HOA: −$0
• Vac / Maint / Mgmt: −$1,320
• Net cashflow: $-639/mo
• Annual: $-7,667/yr
• Cap rate: 5.48%
• Cash-on-cash: -2.89%
• DSCR: 0.87
• 1% rule: 0.74%
• Cash to close: $238,000

Investor read

• This is a 3 × 3-bed/2.3-bath units multifamily listed at $850k.
• At list price, monthly cash flow is $-639 ($-8k/yr) — negative. Per door: $-213/mo.
• To cash-flow at today's rent, offer at most $737k (13.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $629k (26.0% below list).
• It's been on market 140 days — a 12% lower offer ($748k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $629k (26.0% below list) — sets the bar for 1% rule.
• In year one you build about $91k of equity ($6k loan paydown + $85k appreciation (10.0% local appreciation)).
• Location reads 78/100 on livability (#3 in TN, #2,582 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, cost of living A+; Watch: employment D+, crime F.
• Hamilton County (urban): math 31% / reading 31% proficiency, ranked #42 of 139 in TN (top 30%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Battle Academy For Teaching Learning (math 42% / reading 42%, grade F, #191 of 952 statewide, top 22%, 487 students, 0% FRL); Orchard Knob Middle (math 5% / reading 6%, grade F, #291 of 333 statewide, top 88%, 334 students, 0% FRL); The Howard School (math 3% / reading 8%, grade F, #309 of 332 statewide, top 93%, 1,485 students, 0% FRL) — zoned schools average 0% FRL vs 52% district-wide (52 pts lower); this property's tenant base skews higher-income than the district average.
• Zoned-school proficiency averages 18% at this address vs 31% district-wide (-13 pts) — the specific schools serving this property underperform the Hamilton County average; the district grade overstates school quality for this exact location.
• Watch-outs: flood insurance adds $66/mo; built in 1910 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+2.8%/yr); 109 active listings in the ZIP; solid renter incomes; 2,133 units permitted in Hamilton County in 2024 (405 in 5+ unit buildings).
• Hamilton County population projected at +23% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts; this cycle's ask is 94344% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $150k; list at $850k implies a 467% gain — meaningful room to come down on a strong offer.
• By year 2, paydown + projected appreciation supports a ~$146k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: severe flood risk; extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 140 days. Have you received any prior offers? Is the seller open to a 26% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1910 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.