3605 Hodley Ave

Chattanooga, TN 37410

$179,700F

1 bd · 1.0 ba · 650 sqft · Built 2026 · Townhouse · Active · 2 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,147/mo
• Mortgage (P&I): −$942
• Tax + insurance: −$300
• HOA: −$100
• Vac / Maint / Mgmt: −$241
• Net cashflow: $-436/mo
• Annual: $-5,232/yr
• Cap rate: 3.38%
• Cash-on-cash: -10.40%
• DSCR: 0.54
• 1% rule: 0.64%
• Cash to close: $50,316

Investor read

• This is a 1-bed/1.0-bath townhouse listed at $180k. Condition is rated excellent.
• 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).
• Only 2 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $115k (36.2% below list) — sets the bar for 1% rule.
• In year one you build about $4k of equity ($1k loan paydown + $2k appreciation (1.3% 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: 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).
• Hamilton County population projected at +23% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 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.
• By year 9, paydown + projected appreciation supports a ~$32k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• 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.
• 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.

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?
• 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.