Opinions on East Tennessee STR market (Gatlinburg, Sevierville, Pigeon Forge)

[Christopher Brock]

To me - an outsider - it seems as if prices in these markets have trended down over the past year, to a place where returns now seem interesting again. For example ~$650K homes (previously closer to $800K) can consistently produce $100K in annual income, and the deals start to pencil again.

For existing investors, or local vendors, do you agree with this sentiment? What are you seeing? 

I'm aware of all the surface-level risks (post-COVID income decreases, market saturation, amenity requirements, etc.), but it's still a unique market vs. others that are accessible from where I live, in Charlotte, that make it an attractive one to consider. It's been, and will continue to be, one of the stronger vacation markets on the east coast, and from a tax strategy perspective, I can still plan on bonus depreciation, which is material in my individual case.

Thanks for any thoughts from those on the ground, or those with existing STRs in the market!

[Collin Hays]

1. I am very bullish on investing on the Smokies.

2.  I don't know of any $650K homes that are producing $100K a year in rents.  If there is one, I'm a buyer.

3.  Much of what has been built and/or is for sale is absolute junk.  Cheap materials, contemporary designs (again, cheap) that are not compatible with the area, horrendous locations.

4.  The Great Smoky Mountains National Park is the most visited national park in the United States. It is within an 8 hour drive from most of the U.S. population.  It has always been a strong real estate investment market.

5.  You are only looking for one good deal.

6.  Positive cashflow with 80 or 90% borrowed is unrealistic in the beginning years.