Many of you who have been keeping up with my monthly articles know that our market here in the Great Smoky Mountains is a sellers’ market, particularly in the area of vacation cabins that provide rental income. A good cabin with strong rental income potential – even when it isn’t already performing at the level that it can be producing – are under contract with a buyer in about a week. In some cases, real estate agents in the Smokies have buyers who are waiting for a cabin that fits their goals even before we get the listing, and so it’s not uncommon these days for a rental vacation cabin to be sold before it’s listed. It’s also not uncommon for a cabin to get multiple offers within a day or two of being listed and then being sold for the “highest and best” offer shortly after.
For those of you who own a cabin and are thinking about selling, this is awesome news! It means you can probably sell the cabin for quite a bit more than what you paid for it if you bought it after the housing market crash nearly 10 years ago. And if you bought it before the crash, I have great news for you, too: our market is reaching the price levels of that time, so you can sell it for what you paid. Just recently, our MLS saw a 2-bedroom cabin listing in Starr Crest for a little over $400,000. I haven’t seen a 2-bedroom cabin of that size around here go for that much since before the market crash in 2008!
Increasing your rental income
If you love your cabin and are blessed by the value its rental income is adding to your budget, maybe it’s time to start thinking about how you can turn that cabin into an even bigger profit. Many of our clients who worked with us during the downturn are now reinvesting their profits from the sale of their cabin into a bigger cabin, or one with better amenities such as an indoor swimming pool, that is opening up the opportunity for them to earn more rental income.
My staff and I would enjoy the opportunity to talk with you about how this works and determine if selling your cabin to buy a newer one is something that would be a great fit for your financial goals.