Nearly 100 new "starter homes" are planned in Chattanooga near Chickamauga Creek and aimed at helping first-time buyers or empty nesters get into a residence, an investor in the project said.
"That's what Chattanooga needs right now," said Ben Phillips, part of a local group proposing the 95 single-family homes on a mostly vacant tract off Faith Road. "That's our vision."
The 28.5-acre site, a few minutes drive away from Highway 153 and Highway 58, is central to downtown, Chattanooga Airport and the Hamilton Place area, he said.
Called River Park Farms, Phillips said in a telephone interview that price points are under development amid rising costs for wood and other materials.
But he said the residences, ranging from more than 1,350 square feet to over 2,000 square feet, could start around $300,000 and offer a zero percent down payment.
Phillips said that each home is expected to hold three bedrooms though two- and four-bedroom options are possible. The residences also would have at least two bathrooms, he said. In addition, garages are likely, the investor said.
"We know there's strong demand for the housing we're going to put there," he said. "We wanted to go after what Chattanooga needed."
Next month, Phillips' group is seeking Chattanooga-Hamilton County Regional Planning Agency approval to amend a zoning condition on the parcel related to open space on the site.
"It's already zoned for housing," he said. "The amendment will help accommodate the correct mix for the amount of land we're dealing with."
Phillips said the costs to put in roads, sewers and utilities is high.
"It's such a big cost," he said, and the change enables the development group to put in 95 homes rather than fewer.
Mike Price of MAP Engineers, which is working on the project, said the reason for the request isn't to change density.
"We just need to get a little more breathing room to allow us to build a little bit bigger house size," he said in a phone interview.
Chattanooga home prices, which already have seen a steep climb in recent years, were projected in a December study to rise faster in 2022 than in any other metro in Tennessee.
Realtor.com had home prices growing 6.9% in the Chattanooga area in 2022 over the prior year.
Homebuyers purchased a record number of Hamilton County houses during 2021.
In March, Chattanooga's median home price topped $300,000 for the first time as a tight inventory of homes on the market pushed up the typical home sale price by 18.5% compared to a year ago, the Greater Chattanooga Association of Realtors reported.
Still, Chattanooga home prices remain at least 25% below the U.S. average, according to the National Association of Realtors.
A Hamilton County landowner said last month he planned to build 15 more new single-family homes off Snow Hill Road slated to start at $500,000 each.
"We want these to be high quality, more upper end," said Rick Stern, who owns a tract at 7712 Snow Hill Road.
Phillips said there are three existing homes on the Faith Road tract that will be torn down to make room for that planned development.
Contact Mike Pare at mpare@timesfreepress.com or 423-757-6318. Follow him on Twitter @MikePareTFP.