Rental Property Investor · San Diego, CA · Member since 2017 · 66 posts · 66 votes
I've been analyzing deals in Sevier County, TN for a few months (researching the market for a year) and am looking to pull the trigger on a deal soon. Here's an off market deal I'm currently analyzing. This is what they owner has shared with me. Would love to hear who would and would not pull the trigger on this deal who has experience in the market:
Price point: $269k
Gross income: $39k in 2018 . $32k up to 11/30 in 2019 (missing December)
Taxes $836/year
Hoa $250/year
Cable $121/month
Phone $50/month
Electric $184/month
Cleaning supplies (?)
I'll be self managing through my company so I don't need to worry about getting overcharged or priority over other cabins in their portfolio. Can anyone share what they're paying for vacation rental insurance or a ball park for insurance on a 2/2 cabin? Am I missing any other costs that I should be aware of? Would love to hear thoughts from those in the market!
@Tom Donnelly Thank you! Glad it helped! I love Wears Valley. If it's doing 39k not on the major platforms then it can probably do SIGNIFICANTLY better once you get it on them! Without having seen it, I think I would go ahead and buy that one!
2 bedroom should do closer to 50k a year. Cleaning fees included. Because gross is gross right? Listen to @Avery Carl. BP podcast that came out yesterday.
@Tom Donnelly a pretty average 2 bedroom should be able to do more like 45k-50k. It's actually ok that his rental history is lower than that. In a lot of cases the rental history is lower than it should be by no "fault" of the actual property, but by poor management. The only thing I don't like about this is the $250 a month HOA fee. That's higher than most HOA's in this market by $100 a month. Other than that doesn't seem like too bad a deal at all!
$250/year* for the HOA. I believe this area is considered Dancing Bear, not sure if that falls under Sky Harbors territory. Trying to get more details from the owner but it's moving slow.
Do either of you have insight on the insurance piece? We've had some of our homeowners use Proper ins which I think is overpriced but an easy solution. Would love to hear about any local companies that do this at a reasonable price.
@Avery Carl great podcast interview. As an owner of a management company and being in this market space for just a little over a year, you killed it with some very straightforward info. Something that's hard to do in the STR realm for many reasons.
I found out this property is in wears valley. I think it's being mismanaged and I don't believe it's being offered on Airbnb/Vrbo.
@Tom Donnelly Thank you! Glad it helped! I love Wears Valley. If it's doing 39k not on the major platforms then it can probably do SIGNIFICANTLY better once you get it on them! Without having seen it, I think I would go ahead and buy that one!
The one caveatt I found out about this place, it can't get WIFI from major providers. It can only get satellite through HughesNet or a similar provider. Well that threw me a curveball! I haven't seen enough cabins marketed without WIFI to know how big of a detriment that can be.
@Tom Donnelly, I just purchased my 2/2 cabin in Pigeon Forge back in November with the help of @Avery Carl (great podcast Avery) and @Luke Carl who helped me push through the nervousness of buying our first STR. We used @Parker Borofsky for our lender who helped a great deal in steering us through the process of a "2nd Home/Vacation House" loan for our property. Parker steered me to a local STR insurer that we were very happy with. His name is Eric Serio with Brightway Insurance and he was extremely helpful. I can send you his info off the forums if you're interested. I think my premium for our Cabin was under $1500/yr. Avery's podcast talks about buying a place with no internet as their first property and I believe she said it's their best performing property. People just need to know upfront...Good Luck
I own a condo in Gatlinburg- 2/2 and the HOA is $290/mo but includes wifi, water, cable, trash, and sewer. I acquired this property using the 1031 exchange. I have it on Airbnb and VRBO, it does great! March will be a year since I have owned it. This is my first vacation rental and I'm looking for another. I own 40+ other rentals in VA, and this little condo does exceptionally well!
@Tom Donnelly I do indeed have a cabin with no internet, and it is my highest performer. It doesn't even get satellite internet because of the positioning of the house on the mountain and also the trees. We mention it a lot of times in our listing as well as several times between the guest inquiry and actually booking. With anything that could be a perceived negative, as long as the guests know up front you're in good shape. There is also a startup called "Hollernet" that specializes in bringing internet to remote areas around here. Give them a call and see if they service it.
@Avery Carl I'll check out Hollernet and see if that's a route I can go. Good to hear that your cabin is still producing well without internet. I agree with being upfront about everything with guests, if you're not, they'll let you know within minutes of checking in. Or they won't say anything and just leave a negative review which is worse.
The expenses you provided don't include repairs or capex. If you're holding the property for awhile you should probably allocate some of the income for those items.
@Tom Donnelly, if you end up buying in Sky Harbor, I use a husband / wife team that are cleaners / maintenance on a cabin or 2 out that way that are great. Recommended by the Carl power couple. PM me if interested.
Is there a good photographer in the area that you'd recommend for STR listings? We typically book these off of Airbnb but I'd like to use one person for multiple places if possible!
@Tom Donnelly...Luc recommended Mary Dodge photography to us. We're getting her hopefully to photograph our cabin next week while we're down there. You can google her at Mary Dodge Photography to get a quick look at her gallery and references. With that being said, @Luke Carl and @Avery Carl, will you be in the area next week? Would love the opportunity to meet you y'all in person. I'm buying lunch or dinner if your are.
I've been analyzing deals in Sevier County, TN for a few months (researching the market for a year) and am looking to pull the trigger on a deal soon. Here's an off market deal I'm currently analyzing. This is what they owner has shared with me. Would love to hear who would and would not pull the trigger on this deal who has experience in the market:
Tom, did you end up pulling the trigger on this off-market deal? Definitely seems like it's worth going after unless the inspection turns up nightmares, which could then work to your advantage if the owner is motivated to sell.