Tennessee is not just famous for the Great Smoky Mountains and the music of Elvis Pressley. The Volunteer State is also proving to be a very fertile hunting ground for property investors.
Overall, houses in Tennessee are affordable, and there appears to be plenty of opportunities for house flipping in particular. Let’s now take a deeper look at how to flip houses in Tennessee.
Tennessee House Flipping Stats
Median Purchase Price
$88,500
Median Resale Price
$157,480
Average Revenue
$68,980
Price Per Square Foot
$148
Tennessee Population Size
6,829,174
Median Household Income
$50,972
High School Graduation
87,0%
Travel Time To Work
25 Mins
Best Cities for Flipping Houses In Tennessee
- Nashville
- Memphis
- Knoxville
- Chattanooga
- Clarksville
Safest Areas In Tennessee
- Brentwood – Safety Score: 89.06
- Spring Hill – Safety Score: 86.80
- German Town – Safety Score: 86.71
- Gallitin – Safety Score: 85.77
- Collierville – Safety Score: 84.87
Please note – All the statistics in this article are based on 2020 data. You can view the data sources at the bottom of the article.
The Basics Of Flipping Houses In Tennessee
- Find a property in Tennessee that is undervalued
- Source funding from a reputable lender
- Buy the property for a price that makes it possible to generate profit when it is resold
- Complete renovations that will increase the after repair value
- Find buyers for the property and sell it for a healthy profit margin
How To Find Houses To Flip In Tennessee
1. Use FlipScout By New Silver
- Free to use
- Works for flips and rentals
- Get alerts to your inbox
- Calculates rehab costs automatically
- See ROI and rental income instantly
- Aggregate results from various sources
2. Leverage The Power of Wholesalers
Finding a good wholesaler can be very rewarding for a property flipper. Wholesalers tend to have access to all the most relevant property databases, and they often have unique personal networks. By using a wholesaler, you effectively gain inside access to their knowledge of properties in Tennessee.
3. Attend Bank Auctions
Bank auctions often present opportunities to purchase properties below their market value. This is mainly because banks hold these auctions in order to sell the properties as fast as possible. If you attend bank auctions with a clearly defined strategy, you can potentially walk away with a new property that fits in perfectly with your investment portfolio.
4. Use Direct Mail To Find Off-Market Properties
Although it is considered an old school technique, direct mail can still yield positive results for house flippers. Direct mail has been shown to have a higher response rate than email, and numerous studies have shown that people actually enjoy checking their mailboxes. More importantly, you might be surprised by how many people have considered selling their homes. Your letter could be the trigger that they have been waiting for.
5. Sign Up To The Multiple Listing Service (MLS)
Even though MLS listings can be competitive, it is still a good avenue for finding properties to flip. The MLS is literally a database created by real estate agents, and it is filled with property details and statistics that can help aid your research process. There is a fee involved, but one deal is all you need to comfortably cover the costs.
6. Find Foreclosures
When properties fall into foreclosure, the primary goal of the loan originator is to recoup any potential losses. This is good news for house flippers, because properties in foreclosure often sell for less than their market value. If you are able to locate foreclosure opportunities in Tennessee, there’s a good chance you will be able to purchase a property for less than its market value. This is why foreclosure can serve as a great platform for a potential flip.
Tennessee Housing Market Analysis
House Flippers Are Selecting Mid-To-Lower End Houses: There is a significant gap between the median home value in Tennessee ($205,297) and the median resale price for house flips in Tennessee ($157,480). This suggests that investors are generally focusing on the mid-to-lower end of the market where it may be more common to find poorly maintained properties.
It’s also worth pointing out that property flippers in Tennessee are generating approximately $68,980 in revenue per flip. To achieve results like these, selecting the right property is key. Experienced flippers know how to find houses that have the potential to become significantly more valuable after completing well planned renovations.
Home Values Have Appreciated By 9.5%: According to Zillow, home values in Tennessee appreciated by 9.5% over the last year. Moreover, property prices have been steadily increasing since late 2012.
Despite taking a small dip when covid-19 first arrived in the US, the Tennessee real estate market has responded well since then. Historically low interest rates have increased demand for homes, while the supply of houses hasn’t increased proportionally. This is a recipe for continued home appreciation, at least in the short term.
Choose Areas With Good Schools And Plenty of Job Opportunities: Suburbs surrounding good schools tend to hold their value even during trying economic times. For this reason, it’s always a good idea to review the overarching education facilities of the area that you are thinking about investing in.
In addition to good schools, employment opportunities can also influence the economic stability of an area, and by extension, the stability of the housing market. On this point, Brentwood, German Town and Farragut are just some of the many areas in Tennessee with high employment rates.
Rental Prices In Tennessee Have Increased Steadily For Over 10 Years: In 2010, the average rent in Tennessee was approximately $1,053. In 2021, average rent stands at $1,275. This indicates that demand for rental houses has remained steady, and that the need for housing will continue to climb for years to come.
Homes In Tennessee Are Cheaper Than The National Average: The average home value in Tennessee is $205,297. This is considerably less than the average home value in the United States, which is approximately $266,222.
The lower cost of homes in Tennessee is good news for first time flippers, because it reduces the amount of capital needed for a down payment and the total loan amount needed to purchase the property. In other words, the barrier to entry in Tennessee is quite low, and this bodes well for beginners.
Apply For An Investment Property Loan
If you’re ready to start your house flipping journey, New Silver Lending can provide the capital you need to fund your first flip. We offer ultra fast hard money loans with competitive interest rates and quick closing times. The entire application can be completed in less than 10 minutes.
Next Steps
If you’re committed to flipping houses in Tennessee, the next step is to invest time and energy into finding the best possible property. We have outlined a number of methods in this post, and all of them can potentially bear fruit.
Once you have identified a property, using a reputable Hard Money lender like New Silver can help accelerate the house flipping process. Our company is built on speed, efficiency and user-friendly technology. The online application can be completed in less than 10 minutes, and we offer instant proof of funds letters to all of our clients.
Property Flipping Resources
Hard Money Loan Calculator: Analyze the costs of your next flip in detail with our hard money calculator.
ARV Calculator: Workout the After Repair Value of the property that you are hoping to flip.