8326 Middle Rd

Chattanooga, TN 37363

$269,000F

3 bd · 1.5 ba · 1,386 sqft · Built 1973 · SingleFamily · Active · 54 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,184/mo
• Mortgage (P&I): −$1,411
• Tax + insurance: −$198
• HOA: −$0
• Vac / Maint / Mgmt: −$459
• Net cashflow: $117/mo
• Annual: $1,398/yr
• Cap rate: 6.81%
• Cash-on-cash: 1.86%
• DSCR: 1.08
• 1% rule: 0.81%
• Cash to close: $75,320

Investor read

• This is a 3-bed/1.5-bath single-family listed at $269k.
• At list price, monthly cash flow is $117 ($1k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $218k (18.8% below list).
• It's been on market 54 days — a 3% lower offer ($261k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $218k (18.8% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• 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: Wolftever Creek Elementary (math 26% / reading 30%, grade F, #482 of 952 statewide, top 51%, 602 students, 0% FRL); Ooltewah Middle School (math 20% / reading 21%, grade F, #194 of 333 statewide, top 59%, 519 students, 0% FRL); Ooltewah High School (math 9% / reading 39%, grade F, #144 of 332 statewide, top 43%, 1,266 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.
• Market conditions: Rents soft (-0.8%/yr); 746 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 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.
• Current owner paid $64k; list at $269k implies a 317% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: extreme-heat days projected 7→18/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.8% vs local median 3.4% in Chattanooga — top-decile yield for the area; either an underpriced asset or a hidden risk that comps aren't pricing in. Stress-test before assuming the spread holds.

Questions for listing agent

• It's been on market 54 days. Have you received any prior offers? Is the seller open to a 19% concession, seller financing, or rate buy-down credit?
• Built in 1973 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.