Chattanooga Rental Market Updates?

[Daniel Walker]

BP,

Wanted to quickly ask what others were seeing in the Chattanooga rental market. Given that it's the "off-season," are you seeing vacant units sit for longer than they would normally? How many days until you are getting tenants into vacant units? My partner and i have a unit that just came on market. Trying to manage our expectations. Thanks in advance. 

[Brian Levredge]

To add to @Andrea Hardaway's post it also depends on what type of property it is.  Demand for workforce housing is really high.  That's typically $700-$1200/month range.  So on apartments and duplexes in that range, we're getting multiple applications in a matter of days often.  But even that is subjective to a degree.  Nice units in C-D areas trying to get a premium can still sit for weeks just because of the area and because those areas often have a smaller pool from which to attract quality applicants.  

As an owner and operator of multiple apartments in the area rent rates really matter, especially on value add projects since higher rents generally = higher NOI and thus command a higher value. So on those, we will hold out (as long as we're getting traffic) for people to come in at the right rent price when trying to refi within the short term.

Houses, otoh, don't have that issue.  Their value is from comp sales so you have more flexibility on rent.  Sure everyone wants to get the max, but if you have to give up $100/month in rent to get it gone in a week or two vs holding out for a higher number that causes it to sit for weeks long and thus really offsets the potential rent gain due to vacancy loss.