STR in Smokey’s / 1031- too risky?
Hi everyone.
I've been researching STRs in the Smokey's for a solid 8 months now. I owned a small business and sold it in March of this year leaving me with some cash to reinvest into something else. We own a few SFH LTRs and after a visit to Gatlinburg three years ago became sold on the area and doing a STR.
I couldn’t compete with the cash offers sellers were getting the same day their cabin was listed within my price range (up to $250k). So I’ve stepped back from making offers the last while and have come up with a new plan.
I have a SFH in Utah that I have tenants moving out of in January. My plan is to list it for sale after they move. This area is growing like crazy and homes do not sit on the market longer than a week if priced correctly. I believe I will walk away with $150k (on the low end). My plan is to 1031 that money (most but not all) and bump my shopping budget in the Smokey's to $450-$550k. However, I am limiting myself to the properties that come up for sale in those 45 days after I close on my Utah home. I'm hoping I find a property shortly before we list the Utah home and be under contract contingent on when the Utah home sells. I don't know if that will fly either. Competition is fierce.
I’m all for risk but am wondering if this is too risky. I’ve run the numbers so many times on STRs that I have them memorized so I would know when to jump on one quickly. But what if nothing good comes up in that short window? Am I overthinking this?