Airbnb City Guide: The Best Places To Invest in Chattanooga, Tennessee

Airbnb Rules and Regulations in Chattanooga, Tennessee

In 2024, Chattanooga, Tennessee, implemented a comprehensive set of regulations for short-term rental properties, including those listed across different booking sites. All hosts must obtain a Short-Term Vacation Rental (STVR) permit from the city, which is valid for one year and subject to an annual fee. The number of permits issued is capped at 1,500 citywide to maintain a balance between short-term rentals and long-term housing. Hosts are required to collect and remit occupancy taxes, maintain a minimum of $1 million in liability insurance, and ensure compliance with safety standards, noise ordinances, and parking requirements.

The city has designated specific zones where STVRs are permitted, with a maximum of two units allowed per property owner in most residential areas. Hosts must be present during guest stays in residential zones, while non-owner-occupied rentals are only permitted in certain commercial and mixed-use districts. Violations of these regulations may result in fines, permit revocation, and legal action. The city has established a dedicated enforcement team to respond to complaints and monitor compliance, ensuring that Chattanooga's short-term rental market operates responsibly and sustainably.

Chattanooga Airbnb Market Data:

• Average Revenue – $K per year
• Average Daily Rate – $194.8 per night
• Average Occupancy Rate – 57%
• Average RevPAR – $110.8
• Average Home Prices – $300,140

1. Top Place to Invest in Chattanooga, Tennessee - Downtown

Downtown Chattanooga, the heart of the city, offers a vibrant and diverse environment for Airbnb investors. With its rich history, stunning riverfront views, and thriving cultural scene, Downtown Chattanooga has become a sought-after destination for travelers and a lucrative opportunity for those seeking to enter the short-term rental market.

Downtown Airbnb Market Data:

• Average Revenue – $34.3K per year
• Average Daily Rate – $177.5 per night
• Average Occupancy Rate – 53%
• Average RevPAR – $92.5

Convenience - 9/10

Downtown Chattanooga boasts an incredibly convenient location, with easy access to major highways, public transportation, and the Chattanooga Metropolitan Airport. Visitors can easily explore the city's attractions, restaurants, and shopping districts on foot or by using the free electric shuttle service.

Tourist Attractions - 8/10

The downtown area is home to numerous tourist attractions, including the Tennessee Aquarium, Creative Discovery Museum, and Hunter Museum of American Art. Visitors can also enjoy the Walnut Street Pedestrian Bridge, Coolidge Park, and the Chattanooga Riverwalk, which offer stunning views of the Tennessee River and the surrounding mountains.

Things to Do - 9/10

Downtown Chattanooga offers a wide range of activities for visitors, from exploring the city's rich history at the Chattanooga Choo Choo Hotel and the Tivoli Theatre to enjoying live music and entertainment at the Bessie Smith Cultural Center and the Songbirds Guitar Museum. The area also features numerous restaurants, bars, and breweries, catering to diverse tastes and preferences.

Average Home Prices - 7/10

According to Zillow data for 2024, the average home price in Downtown Chattanooga is $450,000, with a 4.5% appreciation rate over the past year. While prices are higher compared to other areas of the city, the strong demand for short-term rentals and the potential for high occupancy rates make Downtown Chattanooga an attractive investment opportunity.

Proximity to Work-Related Travel - 8/10

Downtown Chattanooga is conveniently located near major work-related travel destinations like the Chattanooga Convention Center, Erlanger Health System, and the University of Tennessee at Chattanooga. This proximity makes the area appealing to business travelers and medical professionals, ensuring a steady flow of potential guests.

X-Factor - 9/10

What sets Downtown Chattanooga apart is its unique blend of history, culture, and natural beauty. The area's stunning architecture, vibrant art scene, and picturesque riverfront setting create an unforgettable experience for visitors. The downtown area also hosts numerous local festivals and events throughout the year, attracting tourists from around the world.

2. Top Place to Invest in Chattanooga, Tennessee - St. Elmo

Nestled at the foot of Lookout Mountain, St. Elmo is a charming historic neighborhood that has become increasingly popular among Airbnb investors. With its proximity to outdoor adventures, unique local businesses, and a strong sense of community, St. Elmo offers a distinctive experience for visitors seeking an authentic taste of Chattanooga.

St. Elmo Airbnb Market Data:

• Average Revenue – $42.2K per year
• Average Daily Rate – $199.4 per night
• Average Occupancy Rate – 58%
• Average RevPAR – $115.9

Convenience - 7/10

St. Elmo is located just a short drive from downtown Chattanooga, providing easy access to the city's main attractions and amenities. The neighborhood is served by public transportation, including bus routes and the Lookout Mountain Incline Railway, which connects St. Elmo to the mountain's top.

Tourist Attractions - 8/10

The neighborhood's prime attraction is its proximity to Lookout Mountain, which offers a wealth of outdoor activities and scenic views. Visitors can explore Ruby Falls, Rock City Gardens, and the Chickamauga and Chattanooga National Military Park. St. Elmo itself boasts a quaint, historic charm with its turn-of-the-century architecture and locally-owned shops and restaurants.

Things to Do - 7/10

St. Elmo offers a mix of outdoor adventures and local experiences. In addition to exploring Lookout Mountain, visitors can enjoy the neighborhood's unique shops, art galleries, and eateries. The area also hosts several annual events, such as the St. Elmo Corgi Parade and the Lookout Mountain Plein Air Festival, which showcase the community's character and creativity.

Average Home Prices - 8/10

According to Zillow data for 2024, the average home price in St. Elmo is $325,000, with a 6.2% appreciation rate over the past year. The neighborhood's growing popularity and its proximity to outdoor attractions have contributed to the steady increase in property values, making it an excellent option for investors looking to transform a home into an Airbnb.

Proximity to Work-Related Travel - 6/10

While St. Elmo is not as close to major work-related travel destinations as downtown Chattanooga, it still offers a convenient location for those visiting the city for business or medical purposes. The neighborhood is a short drive from the Chattanooga Convention Center and several major hospitals, including Parkridge Health System and CHI Memorial Hospital.

X-Factor - 8/10

St. Elmo's unique selling point is its combination of outdoor adventure and small-town charm. The neighborhood's proximity to Lookout Mountain and its historic character create a distinctive atmosphere that appeals to travelers seeking an authentic, off-the-beaten-path experience. The strong sense of community and the presence of locally-owned businesses add to St. Elmo's allure as a memorable destination.

3. Top Place to Invest in Chattanooga, Tennessee - Southside Historic District

Once a neglected industrial area, the Southside Historic District has undergone a remarkable transformation, emerging as a trendy and vibrant neighborhood in Chattanooga. With its unique blend of historic charm, thriving arts scene, and eclectic mix of restaurants and shops, the Southside Historic District has become an increasingly popular destination for travelers and a promising opportunity for Airbnb investors.

Southside Historic District Airbnb Market Data:

• Average Revenue – $39.9K per year
• Average Daily Rate – $198.9 per night
• Average Occupancy Rate – 55%
• Average RevPAR – $108.3

Convenience - 8/10

Located just south of downtown Chattanooga, the Southside Historic District offers convenient access to the city's main attractions and amenities. The neighborhood is easily navigable on foot or by bike, with the Chattanooga Bicycle Transit System providing a network of bike lanes and rental stations. Public transportation, including bus routes and the free electric shuttle, connects the Southside to other parts of the city.

Tourist Attractions - 7/10

The Southside Historic District's main draw is its vibrant arts and culture scene. Visitors can explore numerous art galleries, studios, and public art installations, such as the Southside Mural Project. The neighborhood also features unique attractions like the Chattanooga Choo Choo Hotel, a former railway station turned into a hotel and entertainment complex, and the Sculpture Fields at Montague Park, an outdoor sculpture park showcasing large-scale works by international artists.

Things to Do - 9/10

The Southside Historic District offers diverse activities and experiences for visitors. The neighborhood is home to a thriving food and beverage scene, with a wide range of restaurants, cafes, breweries, and distilleries. Visitors can also enjoy live music and entertainment at venues like Track 29 and the Revelry Room or attend one of the many festivals and events held in the area throughout the year, such as the Mainx24 festival and the Chattanooga Market.

Average Home Prices - 7/10

According to Zillow data for 2024, the average home price in the Southside Historic District is $400,000, with a 5.5% appreciation rate over the past year. While prices are higher compared to some other areas of Chattanooga, the neighborhood's growing popularity and the increasing demand for short-term rentals make it an attractive investment opportunity for Airbnb hosts.

Proximity to Work-Related Travel - 8/10

The Southside Historic District is conveniently located near several major work-related travel destinations. The neighborhood is just a short drive from the Chattanooga Convention Center, making it an appealing choice for business travelers. It is also close to several major hospitals, including Erlanger Health System and Parkridge Health System, which can attract medical professionals and visitors.

X-Factor - 9/10

What sets the Southside Historic District apart is its unique blend of history, art, and innovation. The neighborhood's industrial past is evident in its architecture and urban landscape, while its thriving arts scene and entrepreneurial spirit have transformed it into a hub of creativity and growth. The Southside's eclectic mix of locally-owned businesses, public art installations, and community events create a distinctive and memorable experience for visitors, making it a standout destination in Chattanooga.

4. Top Place to Invest in Chattanooga, Tennessee - Highland Park

Highland Park, a historic neighborhood nestled in the heart of Chattanooga, has emerged as a prime destination for Airbnb investors seeking a blend of urban convenience and natural beauty. Highland Park offers a unique opportunity for short-term rental success with its charming residential streets, proximity to downtown attractions, and easy access to outdoor recreation.

Highland Park Airbnb Market Data:

• Average Revenue – $38.1K per year
• Average Daily Rate – $171.1 per night
• Average Occupancy Rate – 61%
• Average RevPAR – $104.8

Convenience - 8/10

Conveniently located just minutes from downtown Chattanooga, Highland Park provides easy access to major highways, local amenities, and public transportation. Visitors can easily explore the city's vibrant cultural scene while still enjoying the tranquility of a residential neighborhood.

Tourist Attractions - 9/10

Highland Park's prime location puts it within walking distance of some of Chattanooga's most iconic attractions, including the Tennessee Aquarium, Walnut Street Bridge, and the revitalized riverfront area. Outdoor enthusiasts can also take advantage of the nearby hiking and biking trails, offering stunning views of the surrounding mountains and natural landscapes.

Things to Do - 8/10

From exploring the city's rich history at the Bluff View Art District and the Chattanooga Choo Choo Hotel to indulging in the thriving food and music scene, Highland Park offers diverse activities for visitors. The neighborhood's proximity to downtown ensures easy access to a wide range of restaurants, breweries, and entertainment venues.

Average Home Prices - 7/10

According to Zillow data for 2024, the average home price in Highland Park is $375,000, with a 5.2% appreciation rate over the past year. While prices are higher than in some other areas of Chattanooga, the neighborhood's desirability and potential for high occupancy rates make it an attractive investment opportunity for Airbnb hosts.

Proximity to Work-Related Travel - 7/10

Highland Park's central location provides convenient access to several major work-related travel destinations, including the Chattanooga Convention Center, Erlanger Health System, and the University of Tennessee at Chattanooga. This proximity makes the area appealing to business travelers, medical professionals, and academic visitors.

X-Factor - 9/10

Highland Park's unique blend of urban living and natural beauty sets it apart. The neighborhood's tree-lined streets, historic homes, and proximity to outdoor recreation areas create a distinctive atmosphere that appeals to travelers seeking a balance between city life and outdoor adventures. Additionally, Highland Park's strong sense of community and local pride contribute to its charm and desirability as a destination.

5. Top Place to Invest in Chattanooga, Tennessee - East Ridge

East Ridge, a vibrant city located just outside of Chattanooga, has emerged as an attractive destination for Airbnb investors seeking a balance between urban convenience and suburban living. With its easy access to major highways, ample amenities, and proximity to Chattanooga's attractions, East Ridge offers a unique opportunity for short-term rental success.

East Ridge Airbnb Market Data:

• Average Revenue – $28.5K per year
• Average Daily Rate – $137 per night
• Average Occupancy Rate – 57%
• Average RevPAR – $76.3

Convenience - 9/10

East Ridge boasts an exceptionally convenient location, with easy access to major highways and interstates, making it a prime spot for travelers. The city itself is well-equipped with shopping centers, dining options, and everyday amenities, ensuring a comfortable stay for guests. Additionally, the proximity to Chattanooga provides access to a wider range of services and attractions.

Tourist Attractions - 7/10

While East Ridge does not have many major tourist attractions, its proximity to Chattanooga allows visitors to easily explore the city's iconic destinations, such as the Tennessee Aquarium, Walnut Street Bridge, and Coolidge Park. The short drive to Chattanooga's vibrant downtown area opens up a world of cultural and recreational opportunities for guests.

Things to Do - 8/10

East Ridge offers a diverse array of activities and experiences for visitors. The city's commercial districts provide ample shopping, dining, and entertainment options, while the nearby Chattanooga area offers a wealth of outdoor recreation opportunities, including hiking trails, parks, and scenic overlooks. Additionally, guests can enjoy the city's local events and festivals, providing a taste of the community's rich culture and traditions.

Average Home Prices - 8/10

According to Zillow data for 2024, the median home value in East Ridge is projected to be around $275,000, representing a 5% increase over the past year. This relatively affordable price point, combined with the area's desirability and potential for high occupancy rates, makes East Ridge an attractive investment opportunity for Airbnb hosts.

Proximity to Work-Related Travel - 8/10

East Ridge's strategic location provides convenient access to several major work-related travel destinations in the Chattanooga area. The city is close to the Chattanooga Convention Center, major hospitals such as Erlanger Health System and CHI Memorial Hospital, and the University of Tennessee at Chattanooga. This accessibility makes East Ridge appealing for corporate rentals, targeting business travelers, medical professionals, and academic visitors.

X-Factor - 8/10

What sets East Ridge apart is its unique blend of urban convenience and suburban living. The city offers the best of both worlds, with easy access to Chattanooga's vibrant downtown and attractions while providing a peaceful and family-friendly residential environment. Additionally, East Ridge's strong sense of community, local events, and affordable cost of living contribute to its charm and desirability as a destination for short-term rentals.

6. Top Place to Invest in Chattanooga, Tennessee - Northshore

Northshore, a vibrant neighborhood nestled along the Tennessee River, has emerged as a prime destination for Airbnb investors seeking a unique blend of urban convenience and natural beauty.

Northshore Airbnb Market Data:

• Average Revenue – $45.3K per year
• Average Daily Rate – $214 per night
• Average Occupancy Rate – 58%
• Average RevPAR – $125

Convenience - 9/10

Northshore boasts an exceptionally convenient location, seamlessly connected to downtown Chattanooga via multiple bridges, including the iconic Walnut Street Bridge, one of the world's longest pedestrian-only spans. This accessibility allows visitors to effortlessly explore the city's attractions while enjoying the tranquility of a riverfront neighborhood.

Tourist Attractions - 8/10

While Northshore itself may not be a major tourist hub, its proximity to downtown Chattanooga provides easy access to numerous attractions, including the Tennessee Aquarium, Coolidge Park, and the Bluff View Art District. Additionally, the neighborhood's riverfront location offers stunning views and opportunities for outdoor recreation along the Tennessee Riverwalk.

Things to Do - 9/10

Northshore offers a diverse array of activities and experiences for visitors. The neighborhood is home to a thriving culinary scene, featuring locally-owned restaurants, breweries, and unique eateries like Clumpies Ice Cream and Milk & Honey. Outdoor enthusiasts can enjoy kayaking, paddleboarding, and biking along the riverfront, while art lovers can explore the area's galleries and public art installations.

Average Home Prices - 7/10

According to Zillow data for 2024, the median home value in Northshore is estimated to be around $444,764, reflecting a 5.2% appreciation rate over the past year. While prices are higher compared to some other areas of Chattanooga, the neighborhood's desirability and potential for high occupancy rates make it an attractive investment for those looking to purchase a property to list on Airbnb or other platforms.

Proximity to Work-Related Travel - 8/10

Northshore's strategic location provides convenient access to several major work-related travel destinations in the Chattanooga area. The neighborhood is close to the Chattanooga Convention Center, major hospitals such as Erlanger Health System, CHI Memorial Hospital, and the University of Tennessee at Chattanooga. This accessibility makes Northshore appealing to business travelers, medical professionals, and academic visitors.

X-Factor - 9/10

Its unique blend of urban energy and natural beauty sets Northshore apart. The neighborhood's riverfront location and vibrant dining and entertainment scene create a distinctive atmosphere that appeals to travelers seeking a balance between city life and outdoor adventures. Northshore's strong sense of community, locally-owned businesses, and public art installations also contribute to its charm and desirability as a destination.