Location: Chattanooga, TN | Metro: Chattanooga, TN-GA MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,040 |
| 1 Bedroom | $1,090 |
| 2 Bedrooms | $1,190 |
| 3 Bedrooms | $1,470 |
| 4 Bedrooms | $1,560 |
| 5 Bedrooms | $1,810 |
| 6 Bedrooms | $2,027 |
| 7 Bedrooms | $2,189 |
| 8 Bedrooms | $2,298 |
U.S. Census Bureau data (2024)
The analysis of ZIP code 37396 reveals a unique market situation that does not align perfectly with traditional classifications but leans towards being a low-yield and low-stability area. The primary driver for this classification is the absence of market rental rates and median home values, which suggests limited activity in the rental and real estate markets.
The Fair Market Rent (FMR) for ZIP 37396 as of the fiscal year 2024 is set at $1110. This figure represents the maximum amount a landlord can charge for rent under the Section 8 program. However, since there is no reported data on market rental rates or median home values, it's challenging to gauge how competitive this FMR is relative to the broader housing market. In such scenarios, landlords should be cautious about relying solely on Section 8 vouchers for their rental income.
Stability indicators in ZIP 37396 are also minimal. The data shows that 0.0% of the population are renters, indicating an extremely low demand for rental properties. Additionally, the lack of days-on-market (DOM) data implies that there might be very few transactions involving rental properties, making it difficult to predict how long it would take to find a tenant. The average income in the area is $26,023, which is significantly lower than most metropolitan areas, potentially affecting the ability of residents to afford higher rents or purchase homes.
Given these factors, ZIP 37396 is best characterized as a low-stability market due to the low rental demand and limited income levels. The low-yield aspect stems from the reliance on a fixed FMR rate without the potential for higher market-based rents. For small-portfolio investors, this area may present challenges in achieving both high returns and stable cash flow. It is advisable to conduct thorough local market research before investing in this ZIP code, focusing on the availability of tenants who qualify for Section 8 and the overall economic conditions that could impact property values and rental income.
Data Sources: FMR data from HUD (2027). Demographics from U.S. Census (2024).
About FMR: Fair Market Rent (FMR) is used to determine payment standards for the Section 8 Housing Choice Voucher program, initial renewal rents for some expiring project-based Section 8 contracts, and rent ceilings for HOME Investment Partnerships.