Knoxville's older neighborhoods have been renovating one bungalow at a time for more than a decade. South Knoxville, North Knoxville and the east side still have dated homes on hilly lots, and buyers moving to East Tennessee keep paying for well-done renovations close to downtown.
In short: LendingStreet funds fix and flip loans on 1-8 unit investor properties in Knoxville and East Tennessee from $150,000 to $5M+, with up to 90% of cost and up to 100% of rehab on some programs. Loans are short-term and interest-only, can close in as little as 10 days, and exit by sale or by refinancing into a DSCR rental loan.
Most investor rehabs here are early 20th-century bungalows and mid-century ranches in South Knoxville, Old North Knoxville, Fountain City, Inskip, Parkridge, Holston Hills and Island Home. Buyers include young professionals, remote workers relocating from larger cities and families who want to be near downtown.
In the suburbs, dated 1970s and 1980s homes in Halls, Powell, Karns and parts of West Knoxville sell to families once they are updated. Finishes matter there, but school zones and commute times matter more.
Many homes sit on hillsides or over crawlspaces, so the work below the floor often costs more than the kitchen.
This example is illustrative and not a quote. An investor buys a 1930s two-bedroom bungalow in South Knoxville for $192,000 and plans an $84,000 renovation: crawlspace encapsulation and floor framing, HVAC, electrical, a new kitchen and bath, and adding a third bedroom in unused space. After-repair value is estimated at $352,000.
The loan covers 85% of the purchase ($163,200) plus 100% of rehab, for $247,200, about 90% of the $276,000 total cost. Over a six-month hold, estimated interest-only payments total about $12,966, and taxes, insurance and utilities add about $2,940.
With buying costs of about $4,800, including Tennessee's transfer and mortgage taxes, and selling costs of about $24,640, estimated profit is about $30,654.
Rehab funds are released in draws after an inspector confirms each stage. Crawlspace and structural work usually comes first, so plan to fund the early stage yourself until the first draw is released.
| Item | Amount |
|---|---|
| Purchase price | $192,000 |
| Rehab budget | $84,000 |
| Loan amount | $247,200 |
| Estimated interest, 6 months | $12,966 |
| Taxes, insurance, utilities | $2,940 |
| Buying and selling costs | $29,440 |
| After-repair value | $352,000 |
| Estimated profit | $30,654 |
Inside city limits, permits and inspections go through the City of Knoxville. Outside the city, Knox County handles them, and Farragut has its own building department. Structural, electrical, plumbing and mechanical work generally need permits.
Some older Knoxville neighborhoods, including parts of North Knoxville, are historic overlay districts where exterior changes such as windows, siding and porches need design review. Check before you plan exterior work.
Ask the city or county how long plan review is taking before you set your schedule. A delay at the permit stage pushes every later step back and adds interest.
Converting an attic, enclosing a porch or finishing a basement can add value, but only if the space is permitted and meets code. Appraisers may not count unpermitted space, and buyers' inspectors will ask.
On hillside lots, additions can trigger engineering and setback questions. Get the city or county's view before you design.
A third bedroom can add meaningful value in a neighborhood where most bungalows have two, but only if the room meets code for size, ceiling height and a proper exit window.
Tennessee charges a transfer tax on deeds and a separate tax on recorded mortgages. Buyers typically pay the mortgage tax and often the transfer tax, though it is negotiable. Title, recording and closing fees add more.
Property taxes in Knox County are moderate, which keeps holding costs lower than in many states.
Ask your title company for a closing cost estimate when you make the offer so the numbers in your budget are real.
Knoxville sells year-round, but spring and early summer are busiest. Homes near the University of Tennessee and downtown also see demand from relocating buyers throughout the year.
Leave room for the end buyer's appraisal and inspection. Crawlspace and foundation items are common inspection findings, so documenting your work helps.
Price the finished home against renovated sales in the same neighborhood, not a nearby area that looks similar. Values can change a lot from one side of a ridge or major road to the other.
Some investors keep a finished home and refinance into a 30-year DSCR loan. Knoxville rents support many renovated homes, especially near downtown and the university.
See our Knoxville DSCR and rate-and-term refinance pages for that path, and the Tennessee fix and flip page for statewide context.
Tennessee does not allow local rent control, and Knox County follows the state landlord-tenant act, so the rules for holding a rental are relatively simple. Write a Tennessee lease and screen tenants carefully.
Send the contract, a line-item budget, photos and your project history. First-time flippers can qualify on some programs, often with lower leverage or an experienced contractor. Call (877) 298-1001 or use the form below.
Include contractor bids if you have them.
Up to 100% of the rehab budget on some programs, with total leverage up to 90% of cost. Rehab funds are released in draws after inspections.
In as little as 10 days when title, the valuation and documents are ready. Having your title company and documents lined up before you go under contract helps meet that timeline.
They can. In overlay districts, exterior changes need design review. Interior work usually does not, but check before you plan.
Knox County handles permits in unincorporated areas, and Farragut has its own department.
Often yes. Moisture and framing problems are common inspection findings in Knoxville, and fixing them helps the sale go smoothly.
Experience helps with leverage and terms. Some programs work with newer investors, especially with an experienced contractor. A licensed contractor with a track record on similar Knoxville homes strengthens a first-time file.
Yes. Fix and flip loans cover 1-8 unit investor properties. Duplexes and small buildings usually sell to investors, so price them on rent and condition.
Yes. Once the home is finished and leased, you can refinance into a DSCR rental loan qualified on rent. Tennessee does not allow local rent control, which keeps the rules for holding a rental relatively simple.
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