STR Cabin House Hack / TN Smokey Mountains

6 Replies

Dear BP Community, I've been doing buy and hold multifamily for the last few years and also just closed on a 59 unit apartment building last month. However over the last 6 months or so I've been studying the STR strategy with the intent on buying in the Pigeon Forge area of TN. Predominant reason being we love the Smokey Mountains ourselves, we enjoy going there and specifically picked the TN side for the shear amount of vacationers that pass through and it's mostly consistent rental volume throughout the year.

We're currently under contract on a cabin in Wears Valley on 2 acres which has a 3/2 cabin, but also a 1000+ soft loft apartment above the garage. Our plan would be to rent the house, and the loft separately as two separate rentals. However I'm nearing wanting to quit my W2 so we are thinking we could house hack the loft while still maintaining the main house as a STR.

We in due diligence currently but set to close first week of October. The kicker is this residence is not currently a rental so we'll need to kit it out in the week we'll have when we visit post close. Since this will be our first STR and we plan to self manage initially out of state it would be great to connect with some other local TN Smokey Mountains investors!

I see there are a few cabin investors in the forums and I’d like to give a shout out to Avery and Lucas Carl for getting us to this point, we wouldn’t of got this far without you! 

My biggest obstacle has been the analysis part of this business, give me a regular multifamily property and I’m good to go, but this is such a different concept and it has me a little outside of my comfort not having that 12 mo lease and a sizable debt service and utilities to pay! 

Look forward to connecting..

Matt



@Matthew Dunn not to worry we’ve done this hundreds of times. I’ve got everything memorized right down to the exact brand and model of couch I like and whom will deliver it. 

This market is 100% short term rental. The furniture stores only sell things to people just like yourself because there’s very few people that actually live here. 

Happy to answer any questions you have! Good luck 

Thanks Lucas! Good news, the inspections went well with no real issues. You happen to have an insurance company you recommend? I have tried Proper but they are quoting me higher than expected. I guess this location is a little far out from the fire dept and the true log adds to the premium!

Any STR investors in the Wears Valley/PF area in early October that want to meet up?

Short term rental insurance is expensive.  If you're getting a cheap,  there's a very good chance down the road that you may regret it.  Because it probably is not the right kind of insurance.  The expenses because it covers things you probably need.  You're not saving money by chopping out  coverages you may need later. It is not a house and it is not a landlord situation. Short-term rentals are commercial and not residential / passive income. Insurance for reflects this and the additional risks. 

or is it cheaper later to have a huge lawsuit or loss of the property and then not have coverage because you didn't have short term rental coverage.

Originally posted by @Matthew Dunn :

Thanks Lucas! Good news, the inspections went well with no real issues. You happen to have an insurance company you recommend? I have tried Proper but they are quoting me higher than expected. I guess this location is a little far out from the fire dept and the true log adds to the premium!

Any STR investors in the Wears Valley/PF area in early October that want to meet up?

 

@Renee Yourk it's going well thank you! We purchased our cabin in 2019 and it's been definitely worth it. Not sure I'd buy another STR just because of the time commitment and active nature of the business. But it's over performing our initial income targets and we have it now as automated as possible.

@Renee Yourk , @Matthew Dunn I am thinking of investing in a STR in Smokey Mountain area. I visited once and enjoyed it. I have no experience so I'm nervous and I'm out of state so could not self manage. I am looking for advice, a realtor, a property manager and any advice you can offer. I'm also wondering if we should move forward given its such a sellers market?