Is 3605 Hodley Ave in Chattanooga, TN a good investment?

CashFlowRE grades it D- with a 3.4% cap rate and $-436/mo modeled cash flow at a $179,700 list price. See the full underwriting and recommended offer on the page.

What is the cap rate for 3605 Hodley Ave?

The modeled cap rate is 3.4% — annual NOI divided by price, using CashFlowRE's rent and expense estimates.

What would this property rent for?

Estimated market rent is $1,147/month, from CashFlowRE's rent model.

D- Composite 39.62

Why this score? — see what drove the D- grade

The composite is a weighted blend of 9 inputs, each scored 0–100. Each bar is that input's sub-score; the figure is the points it added to the 100-point composite (weight × sub-score).

ARV discount +15.0/15.0
Appreciation +5.7/10.0
Cash flow +4.8/30.0
Condition / age +4.8/5.0
Livability +3.9/5.0
Rent growth +2.5/5.0
Schools +1.6/10.0
1% rule +1.4/10.0
DSCR +0.0/10.0

$179,700

3605 Hodley Ave · Chattanooga, TN 37410

1 bd · 1.0 ba · 650 sqft · Townhouse · 2 Days on market

Built 2026 Excellent condition $276/sqft · 90% above area Est $262k · 31% under $100/mo HOA · 9% of rent

🖨 Deal sheet (PDF) 📄 Offer letter ✓ Due diligence

Listing remarks MLS

Brand-new. Move-in ready. Under $180,000. It sounds impossible in today's market, but it's here. At just $179,900, this is the lowest-priced new construction home currently available in Chattanooga, delivering a level of quality and value that's nearly impossible to find. While buyers continue to compete over aging homes, outdated renovations, and flipped properties with unknown histories, this home offers something entirely different--a fresh start with everything brand new, a builder's warranty, and the confidence that comes from knowing you won't be inheriting someone else's deferred maintenance or unexpected repair bills. Why gamble on an older home when you can enjoy the peace of mind that only new construction provides? No wondering when the roof will need replacing. No surprise HVAC failures in the middle of summer. No outdated plumbing or electrical. No expensive appliance replacements just months after moving in. Instead, enjoy the confidence of owning a brand-new home backed by a builder's warranty, allowing you to spend your money making memories instead of making repairs. And don't mistake this price for a builder cutting corners. This home is loaded with upgrades, including durable Hardie siding, quartz countertops, luxury vinyl plank flooring throughout, soaring 9-foot ceilings, abundant natural light, and a thoughtfully designed floor plan that lives larger than its footprint. Every finish was selected with quality, style, and long-term value in mind. Located in the growing Somerville Cottages community, you're just minutes from downtown Chattanooga, St. Elmo, Main Street, Broad Street, Publix, the Riverwalk, and the new Erlanger Stadium. It's a chance to own a brand-new home in an exciting location without stretching your budget.

Key facts

Quartz countertops
Hardie siding
Builder's warranty

What this means for you Summary

Snapshot

This is a 1-bed/1.0-bath townhouse listed at $180k. Condition is rated excellent.

Deal economics

At list price, monthly cash flow is $-436 ($-5k/yr) — negative.
To cash-flow at today's rent, offer at most $117k (35.1% below list).
To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $115k (36.2% below list).
Recommended offer: $115k (36.2% below list) — sets the bar for 1% rule.

Location & tenants

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: Brown Middle School (math 14% / reading 15%, grade F, #231 of 333 statewide, top 70%, 344 students, 0% FRL); Central High School (math 8% / reading 32%, grade F, #183 of 332 statewide, top 59%, 749 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 17% at this address vs 31% district-wide (-14 pts) — the specific schools serving this property underperform the Hamilton County average; the district grade overstates school quality for this exact location.
Market conditions: 104 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals leasing fast (median 5d on market — plan ~1-2 weeks tenant-placement turnaround); lower-income renter base — watch delinquency; 2,133 units permitted in Hamilton County in 2024 (405 in 5+ unit buildings).
At $1,147/mo this rent would consume 48% of the median local household income ($29k/yr) — very limited rent-growth headroom before tenants either downsize or default.

Forward outlook

In year one you build about $4k of equity ($1k loan paydown + $2k appreciation (1.3% local appreciation)).
Hamilton County population projected at +23% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
By year 9, paydown + projected appreciation supports a ~$32k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.

Negotiation context

Only 2 days on market — expect competitive offers; lowballing is unlikely to land.
2 sale attempts with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.

Risks & watch-outs

Climate carrying-cost: extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Recommended offer $114,667 (36.2% below list)

Questions for the 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?
What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
Schools are F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
Crime grade is F in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
What's the average days-on-market for RENTAL listings here right now (not sales)? A rising rental-DOM trend means longer vacancies and softer asking-rent achievability than the comps imply.
What's the recent tenant-quality profile in this submarket — average credit score on applications, eviction rate, late-payment / NSF rate, and stable-employment percentage? A property-management company in the area should have these aggregated.
How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.

Investment metrics

1% rule: 0.64% ✗
Cap rate: 3.38%
Cash-on-cash: -10.40%
DSCR: 0.54
GRM: 13.1

CMA / ARV

ARV (median comp): $262,158
List price: $179,700
Delta: 77.37%
Verdict: OVERPRICED
Comps: 20 within 1.0 mi

Show comp detail 5 sales within ~0.75 mi

Address	Dist	Beds/Ba	Sqft	Sold	Price	$/sf	Match
3625 Hodley Ave #14	0.00mi	1/1.0	650 (0%)	2mo	$187,500	$288	98
2211 W Shepherd Rd	1.77mi	2/1.0 (+1)	682 (+5%)	38mo	$105,000	$154	32
4202 Davis Ln	0.96mi	2/1.0 (+1)	748 (+15%)	8mo	$156,950	$210	28
7639 Austin Dr	0.62mi	2/1.0 (+1)	816 (+26%)	25mo	$200,000	$245	21
7213 Old Cleveland Pike	2.23mi	3/1.0 (+2)	812 (+25%)	58mo	$90,000	$111	10

Match score weights: distance 35% · size 25% · config 20% · recency 20%. Top-matched comps best support the ARV.

Projected returns pro-forma

1.33% appreciation · 3.0% rent growth · sell at horizon

5-year hold

IRR: -8.2%
Equity multiple: 0.58×
Total profit: $-21,379
Equity at exit: $64,486

10-year hold

IRR: -2.6%
Equity multiple: 0.67×
Total profit: $-16,624
Equity at exit: $88,177

Cash invested: $50,316 (down + closing). Projections, not guarantees.

Landlord ↔ Tenant lean methodology

Overall (STATE): 87 Strongly Landlord-Friendly
State Tennessee: 87 Strongly Landlord-Friendly · R+13
County: — inherits STATE
City: — inherits STATE

14-day notice (URLTA); generally landlord-favorable; Nashville court paced moderate.

Methodology + full state rankings →

Active competition Active MLS

For sale now: 0 active · 1 under contract

Closed sales set the value; these active listings set current market conditions and a practical price ceiling.

ZIP-level market 37410

Home prices YoY: 0.6%
Active inventory: 104
Price-to-rent: 13.1×

Monthly cashflow live

Estimated rent: $1,147 high interval (Pro) →
Mortgage (P&I): −$942
Tax est. 1.5%: −$225 /mo · $2,696/yr
Insurance: −$75
HOA: −$100
Lot rent: −$0
Vacancy / Maint / Mgmt: −$241
Net cashflow: $-436

Break-even live

Break-even rent $1,699

Max offer price $116,611

Occupancy floor —

Sensitivity live

Price	-10% $-312	-5% $-374	+0% $-436	+5% $-498	+10% $-560
Rent	-10% $-527	-5% $-481	+0% $-436	+5% $-391	+10% $-345
Rate	-1.0pp $-346	-0.5pp $-390	base $-436	+0.5pp $-483	+1.0pp $-530

UW: 25.0% down · 7.5% · 30yr · 1.5% tax · 5.0% vac · 8.0% maint · 8.0% mgmt

Financing live

Cash to close

Down payment: $44,925
Closing costs: $5,391
Club membership (one-time): —
Reserves months: —
Total cash needed: —

Loan-product check · same deal, 3 products live

Conventional

25% down · 7.5% · 30yr

Cash invested: —
Monthly P&I: —
Monthly cashflow: —
DSCR: —
Eligible?: —

Personal DTI + credit; lowest rate.

DSCR

20% down · 8.5% · 30yr

Cash invested: —
Monthly P&I: —
Monthly cashflow: —
DSCR: —
Eligible?: —

No personal income docs; deal must DSCR.

Hard money

10% down · 12.0% · 12mo

Cash invested: —
Monthly P&I: —
Monthly cashflow: —
DSCR: —
Eligible?: —

Short-term bridge; refi at stabilization.

Rent comps 5 comps

Address	Beds	Baths	Sqft	Rent	$/sqft	DOM	Units	Dist
7852 Opal Dr Unit 102 Chattanooga, TN	—	1.0	516	$950	$1.84	6d	1	0.72mi
4715 Bonny Oaks Dr Chattanooga, TN	1.0–2.0	1.0–2.0	912	$1,139	$1.25	2d	19	0.81mi
4827 Jersey Pike Chattanooga, TN	1.0–3.0	1.5–2.5	950	$1,055	$1.11	0d	12	1.07mi
4025 Oakwood Dr Chattanooga, TN	1.0–2.0	1.0–2.0	875	$1,160	$1.32	6d	9	1.32mi
6168 Foxboro DR Chattanooga, TN	1.0–3.0	1.0–2.0	1093	$1,573	$1.44	5d	34	1.46mi

Property features AI

Finance

HOA & community: HOA with monthly fee of $100HOA covers grounds maintenanceCommunity amenities include a park and sidewalksCommon interest: Condominium

Exterior

Parking: Detached parkingOn-street parkingPaved parking
Utilities: Public waterPublic sewerElectricity available
Home design: Townhouse (attached)Residential propertyHas a viewThree or more levelsEntry level information not provided
Construction: New constructionOther construction materialsOther roof typeSlab foundation
Exterior features: Covered patio

Interior

Kitchen: MicrowaveElectric rangeElectric ovenDishwasherDisposal
Bedrooms: 1 bedroom
Bathrooms: 1 full bathroom
Heating & cooling: Central electric heatingElectric cooling
Interior features: Ceiling fansHigh ceilingsOpen floor planWalk-in closet(s)
Laundry & utility: Washer hookupElectric dryer hookup

HOA detail $100/mo · $1,200/yr

Likely covers: electric

Listing history 50 events

2026-09-23

days on market $179,700 Active 2 DOM
2026-09-21

pricedays on marketlisting id $179,700 Active 1 DOM

Show marketing remark (1775 chars)

Brand-new. Move-in ready. Under $180,000. It sounds impossible in today's market, but it's here. At just $179,900, this is the lowest-priced new construction home currently available in Chattanooga, delivering a level of quality and value that's nearly impossible to find. While buyers continue to compete over aging homes, outdated renovations, and flipped properties with unknown histories, this home offers something entirely different--a fresh start with everything brand new, a builder's warranty, and the confidence that comes from knowing you won't be inheriting someone else's deferred maintenance or unexpected repair bills. Why gamble on an older home when you can enjoy the peace of mind that only new construction provides? No wondering when the roof will need replacing. No surprise HVAC failures in the middle of summer. No outdated plumbing or electrical. No expensive appliance replacements just months after moving in. Instead, enjoy the confidence of owning a brand-new home backed by a builder's warranty, allowing you to spend your money making memories instead of making repairs. And don't mistake this price for a builder cutting corners. This home is loaded with upgrades, including durable Hardie siding, quartz countertops, luxury vinyl plank flooring throughout, soaring 9-foot ceilings, abundant natural light, and a thoughtfully designed floor plan that lives larger than its footprint. Every finish was selected with quality, style, and long-term value in mind. Located in the growing Somerville Cottages community, you're just minutes from downtown Chattanooga, St. Elmo, Main Street, Broad Street, Publix, the Riverwalk, and the new Erlanger Stadium. It's a chance to own a brand-new home in an exciting location without stretching your budget.
2026-08-14

days on market $465,000 Active 71 DOM
2026-08-13

days on market $465,000 Active 70 DOM
2026-08-12

days on market $465,000 Active 69 DOM
2026-08-11

days on market $465,000 Active 68 DOM
2026-08-10

days on market $465,000 Active 67 DOM
2026-08-09

days on market $465,000 Active 66 DOM
2026-08-08

days on market $465,000 Active 65 DOM
2026-08-07

days on market $465,000 Active 64 DOM
2026-08-06

days on market $465,000 Active 63 DOM
2026-08-05

days on market $465,000 Active 62 DOM
2026-08-04

days on market $465,000 Active 61 DOM
2026-08-03

days on market $465,000 Active 60 DOM
2026-07-31

days on market $465,000 Active 57 DOM
2026-07-29

days on market $465,000 Active 55 DOM
2026-07-27

days on market $465,000 Active 53 DOM
2026-07-25

days on market $465,000 Active 51 DOM
2026-07-24

days on market $465,000 Active 50 DOM
2026-07-23

days on market $465,000 Active 49 DOM
2026-07-22

days on market $465,000 Active 48 DOM
2026-07-21

days on market $465,000 Active 47 DOM
2026-07-18

days on market $465,000 Active 44 DOM
2026-07-16

days on market $465,000 Active 42 DOM
2026-07-16

days on market $465,000 Active 41 DOM
2026-07-14

days on market $465,000 Active 40 DOM
2026-07-13

days on market $465,000 Active 39 DOM
2026-07-12

days on market $465,000 Active 38 DOM
2026-07-11

days on market $465,000 Active 37 DOM
2026-07-10

days on market $465,000 Active 36 DOM
2026-07-09

days on market $465,000 Active 35 DOM
2026-07-08

days on market $465,000 Active 34 DOM
2026-07-07

days on market $465,000 Active 33 DOM
2026-07-06

days on market $465,000 Active 32 DOM
2026-07-05

days on market $465,000 Active 31 DOM
2026-07-04

days on market $465,000 Active 30 DOM
2026-07-03

days on market $465,000 Active 29 DOM
2026-07-02

days on market $465,000 Active 28 DOM
2026-07-01

days on market $465,000 Active 27 DOM
2026-06-30

days on market $465,000 Active 26 DOM
2026-06-29

days on market $465,000 Active 25 DOM
2026-06-28

days on market $465,000 Active 24 DOM
2026-06-28

days on market $465,000 Active 23 DOM
2026-06-27

days on market $465,000 Active 22 DOM
2026-06-25

days on market $465,000 Active 20 DOM
2026-06-23

days on market $465,000 Active 18 DOM
2026-06-22

days on market $465,000 Active 17 DOM
2026-06-18

days on market $465,000 Active 14 DOM
2026-06-17

days on market $465,000 Active 13 DOM
2026-06-16

days on market $465,000 Active 12 DOM

ⓘ Source: listings_history table (triggers on properties + properties_extension) + one-shot backfill from property_details.listing_events for pre-trigger history.

Climate risk First Street

🌊 Flood 1/10 Low FEMA zone X (unshaded) · 0% chance over 30 yrs
🔥 Wildfire 1/10 Low
🌡 Heat 6/10 Major 7 d/yr ≥104°F today · 19 d/yr by 30 yrs out
💨 Wind 4/10 Moderate 10% chance of damaging wind over 30 yrs
🫁 Air quality 3/10 Moderate 2 unhealthy d/yr today · 2 by 30 yrs out

Nearby sold comps map

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Walkable amenities ~0.75 mi

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Taxation est. · year 1

Rental income: $13,760
− Mortgage interest: −$10,066
− Property taxes: −$2,696
− Insurance: −$898
− Repairs & maintenance: −$1,101
− Management: −$1,101
− HOA: −$1,200
− Depreciation: −$5,228
Taxable loss: −$8,529

Your marginal tax rate % combined federal + state — saved on this device

Est. tax savings @ 24.0%: +$2,047
After-tax cash flow: $-3,185/yr

For passive investors: Depreciation is non-cash, so a rental often shows a tax loss while cash-flowing — sheltering income. Rental losses are passive: they offset passive income freely, and up to $25,000/yr can offset ordinary (W-2) income if you actively participate and your MAGI is under $100k (phasing out to $0 by $150k); unused losses carry forward. On sale, claimed depreciation is recaptured at up to 25%, and gains may owe capital-gains tax (a 1031 exchange can defer both). Figures are a year-1 estimate at your 24.0% rate — not tax advice; consult a CPA.

Condition & rehab AI · 13 photos

Excellent 95/100 None rehab

This newly constructed two-unit townhome in the Somerville Cottages community is in excellent condition with no visible repairs or maintenance needed. The property is move-in ready and offers multiple opportunities for income generation and investment.

Value-add opportunities

Both Painting the exterior and interior walls — Fresh paint can enhance curb appeal and interior aesthetics, making the property more attractive to potential buyers and renters. ↑
Both Landscaping improvements — Enhancing the landscaping can improve the property's curb appeal and make it more inviting for potential buyers and renters. ↑

F Composite school gradezoned avg 16/100

Zoned Schools

Elementary Hixson Elementary F TN #601/952 Nat'l #32,000/41,679 Middle Orchard Knob Middle F TN #291/333 Nat'l #13,801/14,009 High Central High School F TN #183/332 Nat'l #14,291/17,239

Schools (NCES district)

District: Hamilton County
NCES district ID: 4701590
Math proficiency: 31% ▼ -10.00%
Reading proficiency: 31% ▼ -3.00%
Median HH income: $47,456
Composite: 26.8/100
National rank: #7122
State rank: #42 of 139 in TN

B Composite livability gradescore 78/100

Livability — Chattanooga

Score: 78/100
State rank: #3
US rank: #2582

Category grades

Amenities A+ Commute A+ Cost of living A+ Crime F Employment D+ Housing A+ Health & safety A User ratings C+

Schools grade is shown separately in the Schools card above.

Census & demographics

Census place: Chattanooga, TN
County: Hamilton County · 393,784 people
City population: 131,999
Metro: Chattanooga, TN-GA
Population (ZIP): 4,129
Household income: $28,708
Rent vs Own: 79.9% rent · 20.1% own
Severe rent burden: 2% of renters

Population outlook (Hamilton County) Hauer SSP2

Today (2025): 393,784 people
By 2030: 412,983 · +4.9%
By 2040: 449,502 · +14.1%
By 2050: 484,341 · +23.0%
By 2075: 565,746 · +43.7%
By 2100: 618,394 · +57.0%

Race, ethnicity, and origin ACS 2023

Neighborhood character: Predominantly Black (81%)
Race & ethnicity: Black 81% Two or more races 10% White 8% Hispanic / Latino 7%
Hispanic origin (detail): Mexican 2%
Common ancestry: Scotch-Irish 1%
Foreign-born: 6% · Canada
Languages at home: 94% English-only · Spanish 6%

Political lean MEDSL · Hamilton

2024 margin: R (+13.1) · D 42.7% · R 55.7% · Other 1.6%
2008→2024 swing: -1.2pp toward R · 2008: -11.8pp · 2024: -13.1pp
All cycles: 2024: R+13.1 2020: R+9.7 2016: R+16.6 2012: R+14.8 2008: R+11.8

Not yet ingested

Civics: —

Market trends

HPI YoY: ▲ 1.33%
Current HPI: 228.3522
Rent YoY: —
Metro: Chattanooga, TN-GA
State GDP YoY: ▲ 2.78%
F500 in state: 22

Industry mix (Fortune 500 HQ in TN)

Industry	F500 HQs	Revenue
Healthcare	3	$91B
#61 HCA Healthcare Nashville $70.6B #287 Community Health Systems Franklin $12.4B #445 Envision Healthcare Nashville $7.8B
Retail	3	$72B
#110 Dollar General Goodlettsville $38.7B #181 AutoZone Memphis $18.5B #253 Tractor Supply Brentwood $14.9B
Transportation / Logistics	1	$88B
#49 FedEx Memphis $87.7B
Paper / Packaging	1	$19B
#172 International Paper Memphis $19.4B
Insurance	1	$13B
#238 Unum Group Chattanooga $13.0B
Energy	1	$12B
#458 Delek US Holdings Brentwood $11.7B

Price history

+0.0% since first listed

2 events — show timeline

2026-09-21 Listed $179,700 GCAR
2026-09-21 Listed $179,700 REALTRACS as Distributed by MLS Grid

Cash-flow waterfall

monthly

Sold comps — $/sqft

last 12 mo · ≤1 mi

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