Selling in a sellers’ market can mean increasing your rental income

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.

Call me at 865-765-6157 or Greg at 865-643-2103 and we will be glad to show you how you can increase your rental income.

Sherwood Forest resort investment cabin offers amazing opportunity

Our featured “Cabin of the Month” is this amazing investment cabin located in Sherwood Forest resort!

Sherwood Forest resort in Pigeon Forge is one of the top rental vacation investment cabinresorts in the Great Smoky Mountains! This 4 bedroom investment cabin comes with its own indoor pool and full theater setup, providing your guests with the very best of amenities needed to make an outstanding rental experience. Indoor pools in rental cabins generally pay for themselves, and cabins that have them can produce significantly more than those that don’t because they continue to attract guests in the cold winter months at the beginning of the year.
This fantastic investment property is only 5 years old and has a low HOA fee.
To learn more about this investment cabin, click here.

To schedule a showing at this investment cabin, call our office at 865-429-2121 or my support line at 865-654-2111.

Eight bedroom rental is “Cabin of the Month”

eight bedroom rentalOur cabin feature this month is an eight bedroom rental property located in Wears Valley.

You’ll be “Steppin’ on the Clouds” in this gorgeous eight bedroom rental cabin in Wears Valley. This is a fantastic income-building investment, on track to pass $170,000 in gross rental income this year!

With its absolutely magnificent panoramic 180-degree views of the Great Smoky Mountains, you and your guests will love relaxing in front of one of the best views of the National Park any rental cabin here has to offer. Enjoy the cabin’s large fire pit or hot tub, or make your way over to the nearby resort at “The Preserve” to go swimming in the pool. Best of all, this cabin is just minutes from the National Park!

You’ll find plenty of activities inside this eight bedroom rental as well, ranging from the cabin’s fully outfitted gaming room with air hockey, foosball, and a pool table (not to mention an arcade game system). The cabin also houses a fantastic huge theater room. The cabin’s design includes handsome tongue-and-groove, gleaming large wood beams, walls of glass, and a stone fireplace centerpiece. It’s the perfect place for a relaxing vacation getaway, and can sleep up to 28 guests.

To learn more about this eight bedroom rental cabin, click here.

If you’d like to schedule a visit to see this eight bedroom rental cabin, contact me at 865-765-6157 or my support line at 865-654-2111.

Sky Harbor cabin can pay for itself!

Sky Harbor cabinThis serene, private two bedroom Sky Harbor cabin is our featured “Cabin of the Month” for April! This true log cabin is the perfect second home or investment property!  With a master bedroom on the main floor, this cabin’s 1,200 square feet space offers an open concept floor plan perfect for entertaining your entire family and guests. The oversized windows in your new investment’s cathedral ceiling bring in the majestically serene views of nature. You’ll adore the gleaming wood floors throughout.
Upstairs, the Sky Harbor cabin’s large open loft is equipped with a game room. The wrap around deck with its own private hot tub is the perfect place for relaxing in the evening with a glass of wine as you wind down from the day of exploring and/or shopping, thanks to the convenient location that puts this cabin just 10 minutes from the Parkway into Pigeon Forge, 15 minutes to Gatlinburg, or just a few minutes more into the National Park!

Best of all, this Sky Harbor cabin will pay for itself. Ask us how!

If you’d like to know more about this Sky Harbor cabin, click here.

If you’d like to visit this Sky Harbor cabin, call me at 865-765-6157 or my support line at 865-654-2111 to schedule a showing.

Make this 2-bedroom cabin your vacation home

For our March “House of the Month,” we’ve selected this beautiful 2-bedroom cabin in Parkside Village.

2-bedroom cabinNow you can own your own perfect getaway with this cozy two bedroom and two bath cabin smack dab in the center of Wears Valley! It’s located just minutes from town and offers easy access to either Townsend or the National Park. This is a mountain lover’s dream!

Well maintained and newly stained, this 2-bedroom cabin’s open floor plan will offer you the chance to relax with family and friends or enjoy a nice game of pool in the downstairs game room.

You can learn more about this 2-bedroom cabin here.

Turn this into your cash-flow nest egg today! Contact me at 865-765-6157 or call my support line at 865-654-2111 to visit this 2-bedroom cabin.

This 1-bedroom cabin is March feature

For our March “Cabin of the Month,” we’ve chosen this 1-bedroom cabin nestled in Parkside Village.

Taken care of by a great owner, this 1-bedroom cabin offers the perfect opportunity to get away from it all and just relax in the quiet of the woods. Located in the heart of Wears Valley, this is your1-bedroom cabin chance to own your very own quaint one bedroom and one bath. Make it your second home or continue to enjoy it as an income producing rental property!
The great open floor plan flows well and is perfect for you and your closest family. Adorned with small handcrafted details that really make this cabin stand out from the rest. Step out onto your back deck that is wonderful for grilling or enjoying a cup of coffee on a crisp Tennessee spring morning.  And of course, it comes equipped with a covered hot tub so that you can enjoy a relaxing soak, rain or shine!

To learn more about this 1-bedroom cabin, click here.

If you would like to schedule a visit to see this 1-bedroom cabin, contact me at 865-765-6157 or call my support line at 865-654-2111.

Buying smart as a real estate investor

The most common type of phone call we receive from buyers looking for real estate in our market usually starts out something like, “I’ve never really owned vacation rentals before but I want to buy one with great rental history!”

real estateI always tell them, “Awesome, you want to become an investor! I can definitely help you with that!”

The conversation then turns to identifying what exactly they are looking for in an investment property and what their budget is for buying real estate. Once we have those parameters figured out, the next point to focus on is understanding what their long term plans are with buying real estate. Always be looking for real estate property with the expectation that you will sell at some point.  This is the first, most important step in the process of buying real estate. We have found that it is fairly common for investment cabin owners to relist their cabins within five or so years.  Either their investment strategies evolve leading them to buy other cabins or to invest in other ideas, or life happens and their focus on where they want to spend their investment dollars changes. So, always buy with the sale in mind. What does that mean? Well, it means there are several criteria you want to do your best to meet as you search for the best investment.

  1. It’s got to be in a great location. Location is everything, as I’m sure you know. You’ve got to buy something in a great location. You can change almost anything about a home but you can’t change the location. You can’t move a house if it’s in a bad location. So how do we define “great location?” Well, in the Smokies, a great location is generally something that has a beautiful view of the mountains, is close to attractions, and is relatively peaceful. If your investment property doesn’t meet at least some of those criteria, it had better offer something incredibly unique that renters will find appealing.
  2. Buy the lowest priced property of the best quality on the block. You definitely don’t want to own the most expensive home or cabin in the resort, and the reason is this: when you get ready to sell, you will have a hard time getting that piece of real estate to appraise for what you want from it. Appraisers look at similar properties in the same area of the property for sale as much as possible, and often times a property that is priced higher than the ones around it sold for has trouble getting approval for the price you are being offered. Without an appraiser’s stamp, a lender won’t be able to authorize the deal unless the buyer is willing to pay the difference up front. Most buyers using a lender usually can’t (or won’t). By going after something that is less expensive, you have enough room to maneuver as it appreciates in value.
  3. Buy as high quality of property as you can afford. People are always looking for the best deal, and I personally love helping them finding someone else’s mistake that they can turn into a win. But even with that goal it’s important to remember that the cheaper something is, the more you will have to spend to turn it into a gold mine. You want to buy real estate property with good bones that will hold up better without much maintenance. On that subject, don’t buy something with an outdated, obsolete floor plan. You want to buy something that can be changed to keep up with the interior design trends. So buy something with potential to be great without having to completely rebuild from scratch.

Remember, the goal in real estate investing is to make money with the property, both on the front end over the years as you rent it and on the back end when you sell it for a profit. If you’re not striving to reach those two goals, it might be someone else buying your mistake instead!

Next month, I’ll take you through some of the strategies I encourage my buyers to use once they’ve found the “diamond in the rough” so that remodeling the home increases their profits rather than cutting into it.

In the meantime, if you have any questions about the local real estate market, my team and I are always here to help and answer questions.

This cabin can be your vacation home

For our “Cabin of the Month” of January, we’ve selected this vacation home in Cedar Falls.

Level lovacation homets are hard to come by here in the Great Smoky Mountains region, but this cabin is on one! It’s the perfect spot for enjoying time with your family around the fire pit! Enjoy the private setting of this vacation home located in the beautiful Cedar Falls resort, just minutes from Pigeon Forge! Step onto the wrap around porch with your fresh cup of morning coffee and take in all that nature has to offer, including your very own stream that runs right across your property.
This one bedroom, almost 1,400 square foot vacation home cabin utilizes an open concept floor plan with soaring ceilings, hand crafted gorgeous fireplace, wood floors, upscale furnishings and over-sized windows to take in nature. It is handicap accessible with a ramp entrance and wide doorways. You’ll find the cabin is a well maintained vacation home that comes equipped with 2 Master suites. Both have their own attached baths. The cabin also comes with its own unique carport for parking your vehicles.
This property has never been on rental but is in pristine condition and has excellent income potential. You can see other details about this vacation home here.

To learn more about this vacation home or to schedule a showing, call us at 865-654-2111.

Sellers’ market for rental cabins likely to continue in 2018

We are finally reaching the end of 2017 and wow, what a year it’s been! We started with one of the worst tragedies our region has seen as we watched the Smoky Mountains and parts of Gatlinburg burn just over a year ago. So many vacation and rental cabin owners were devastated by the wildfires and we worked with many of them as they made the tough decision to either build back or buy something else. As the costs of materials and construction climbed over the year due to catastrophes in other parts of the country, even people who planned to rebuild their rental cabins slowly abandoned those plans because the price of doing that was just too much.

The rental cabin market in 2017

Not everyone who owned a cabin was eager to sell, though, so what we ended uprental cabin market with was a market of anxious buyers without enough cabins on the market to meet the demand. And many of them had cash from their insurance checks, so they were willing and able to pay a little more than someone who was new to the idea of buying a cabin, or who was working with a lender. The result was that prices of existing cabins began to steadily climb as well. The price to buy remained lower than the price to build throughout the year, and we still haven’t reached the point where building and buying are equal in price.

The number of residential properties, including rental cabins, didn’t quite reach the number sold in 2016, but the average price of such properties increased roughly $25,000 on average and our total sales for the Great Smoky Mountains region passed $540,000,000. Nearly 1,100 of the properties sold were vacation and rental cabins. With the flurry of buyers, we saw properties on the market sell very quickly, sometimes in less than a week if they were competitively priced or in a fantastic location for the right buyer.

So what does all that mean for 2018? Well, the number of residential homes and rental cabins for sale in our market will continue to be down and the market for buyers will remain a competitive one. This is good news for sellers but not good news for buyers. If you are thinking about buying a cabin, sooner is better than later. The longer you wait, the more difficult it will be to find a property within the price range you want to be in and the more competition you will have for what’s available. The market price for residential property will continueBlack Bear Ridge to climb until it reaches a point where the cost of building is a reasonable option. The most important thing to understand in that statement is that the cost of building isn’t likely to go down in the foreseeable future, either. So as the price of building climbs, it will be that much longer before building and buying are the same price.

Finally, none of this is exact science. In fact, there’s a lot more art to it than science. But what we do know is that the vacation rental cabin market is booming and because of that, cabin owners generally aren’t likely to sell their investment properties as long as they can make more with the rental income than they can from the sale of the cabin. The other factor for owners is the tax depreciation. Until that is used up, they will keep going. (Talk to your tax attorney if you want to understand more about how tax depreciation can be beneficial to you in the vacation cabin market.) And, the increasing number of buyers, especially people who are moving their investments from the coast line to the mountains, is expected to continue. This high number of buyers will drive the market.

As always, my staff and I are here to answer any questions you have about the rental cabin market.

Fantastic mountain views help make this rental cabin a great investment!

Our featured ‘Cabin of the Month’ for December has incredible mountain views of the National Park!

Enjoy gorgeous mountain views all day at this 3 bedroom plus a bonus room and 4.5 bathroom cabin in Hickory Hollow! Its open, spacious floor plan is perfect for entertaining the whole family. You will adore the soaring ceiling accompanied by an amazing wall of glass where you can gaze the mountain views from the comfort of the main room.mountain views
This cabin is turn key ready with its wood floors, handsome tongue and groove throughout, gleaming granite counters, river stone fireplace, stainless appliances, outfitted game room, hot tub, private loft, 2 floors of deck, and beautiful upscale décor!
You can see more details about this cabin here.

To schedule a visit to see this cabin and its amazing mountain views, call me at 865-765-6157 or my support line at 865-654-2111.