What's a good cap rate in Chattanooga?

In Chattanooga, cap rates typically run around 6.8% (Tennessee state median). A deal above that line is outperforming the local market; below it, you're paying up for appreciation or stability. TrueCap shows where any specific Chattanooga deal lands versus this benchmark.

What's the average rent for a rental in Chattanooga?

A typical rental in Chattanooga runs about $1,390–$1,734/mo (HUD Fair Market Rent, 2–3BR). TrueCap auto-fills HUD Fair Market Rent for the exact address you enter.

What is the property tax rate in Tennessee?

Tennessee's effective property tax rate is about 0.67% of value per year — the figure TrueCap applies by default for Chattanooga deals. You can override it with the exact local rate.

Chattanooga, TN

Chattanooga rental property analysis

Chattanooga is a revitalized mid-size metro with no state income tax and a growing tech-and-logistics base — affordable with real upside.

Chattanooga market snapshot

Balanced market

Mid-range cap rates — cash flow and appreciation are both realistically on the table.

Typical cap rate

6.8%

Tennessee state median

Typical rent

$1,390–$1,734/mo

HUD FMR · 2–3BR · 2026

Typical price

$250,000–$340,000

est., all-in

Property tax

0.67%

Tennessee effective

Rent is HUD Fair Market Rent where available, otherwise a market estimate; price is a market estimate. Cap-rate and tax are the defaults TrueCap applies — enter a specific address for exact, auto-filled numbers.

Sources & methodology. These are screening defaults and market estimates — not an appraisal, and not financial, tax, or legal advice. Verify rents, taxes, insurance, and local landlord/tenant law against the county assessor and your state's landlord-tenant statute before relying on them.

Data: HUD Fair Market Rent · FRED 30-yr mortgage rate · Tax Foundation (property tax) · Updated June 2026

Metro-level estimates — precision is lower at the neighborhood and parcel level; pull a specific address for exact, auto-filled figures. Reviewed by the TrueCap team. See our full methodology.

Is Chattanooga a good place to buy rentals?

Balanced cash flow with appreciation potential as the downtown and riverfront draw continues. Attainable entry for the growth on offer.

See the full Tennesseeinvesting guide — taxes, landlord law & top metros →

Neighborhoods to look at in Chattanooga

East Ridge

Affordable, family renters, steady demand.

Red Bank

Stable suburb, reliable tenants.

Hixson

Newer stock, low vacancy.

Neighborhood notes are starting points, not recommendations — always underwrite the specific property.

Run a Chattanooga deal in 60 seconds

Paste a Chattanooga address into TrueCap and get cap rate, cash-on-cash, DSCR, cash flow, and a 10-year projection — auto-filled with Tennessee tax and HUD rent so you start from the right assumptions.

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