Smoky Mountain Vacation Rental
Nashville, TN · Member since 2017 · 28 posts · 14 votes
Smoky Mountain Vacation Rental
Most Popular Reply
Hi John - this came to me this morning from my Property Manager and I think its all pretty accurate:
Instead,
I want to look past this crisis and offer some encouragement for the
future. Things will get better. This will not last forever. We will
be here to see you through.
While we are likely in store for a very rough ride in the short term, I
want you to know – the Smoky Mountains will be the first vacation market
to recover. You can count on that. Put it in the bank. All the
reasons that make Sevier County Tennessee the
best place in the country to own income earning vacation property are
still right here. In fact, many of the things making us a desirable
destination, will ring especially true once the dust clears from the
COVID panic.
- We are a driving destination located within a day’s drive of 75% of the US population. You don’t have to get on a crowded airplane to visit the Smoky Mountains.
- We are a nature-driven tourist destination. The GSMNP is still our number one attraction, and those mountains are not going anywhere. Visitors to the Smokies don’t have to get in the crowds to enjoy their time here.
- We are affordable compared to other vacation destinations and staying in a private cabin offers entertainment and food preparation options that add vacation value.
- Renting a private mountain home will be more immediately appealing than hotels when guests return to planning vacations. Enjoying a private cabin keeps you out of those hotel elevators and common spaces.
- The Smokies is a family vacation destination – and some stress-free family time will be high on everyone’s wish list soon.
While I want each of you to be prepared for some tough months ahead, I
also want you to be encouraged. Our vacation market, like most of the
world, is on pause. However, things will not stay paused forever. The
show will go on. Our guests will return.
The Smokies will always be desirable, and we will be here promoting all those things that make our destination, and your beautiful cabins – the place to be.
76 Replies
- 6yLuke CarlPro MemberRental Property Investor · Tennessee Florida · Member since 2016 · 4k+ posts · 5k+ votes
Hey John! No way to predict the future unfortunately. I'm very happy with my cabins. Check out bigger pockets podcast number 364.
As far as the current state of affairs.... I'm staying positive and hoping for the best!
Hi John - this came to me this morning from my Property Manager and I think its all pretty accurate:
Instead, I want to look past this crisis and offer some encouragement for the future. Things will get better. This will not last forever. We will be here to see you through.
While we are likely in store for a very rough ride in the short term, I want you to know – the Smoky Mountains will be the first vacation market to recover. You can count on that. Put it in the bank. All the reasons that make Sevier County Tennessee the best place in the country to own income earning vacation property are still right here. In fact, many of the things making us a desirable destination, will ring especially true once the dust clears from the COVID panic.
- We are a driving destination located within a day’s drive of 75% of the US population. You don’t have to get on a crowded airplane to visit the Smoky Mountains.
- We are a nature-driven tourist destination. The GSMNP is still our number one attraction, and those mountains are not going anywhere. Visitors to the Smokies don’t have to get in the crowds to enjoy their time here.
- We are affordable compared to other vacation destinations and staying in a private cabin offers entertainment and food preparation options that add vacation value.
- Renting a private mountain home will be more immediately appealing than hotels when guests return to planning vacations. Enjoying a private cabin keeps you out of those hotel elevators and common spaces.
- The Smokies is a family vacation destination – and some stress-free family time will be high on everyone’s wish list soon.
While I want each of you to be prepared for some tough months ahead, I also want you to be encouraged. Our vacation market, like most of the world, is on pause. However, things will not stay paused forever. The show will go on. Our guests will return. The Smokies will always be desirable, and we will be here promoting all those things that make our destination, and your beautiful cabins – the place to be.
- 6yJohn UnderwoodPro MemberInvestor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
I would see if you could postpone closing given the Pandemic. That will save some of your reserves.
They should be OK with that.
Also remember you won't owe your first mortgage payment for 60 days or so. At least time your closing to maximize this.I am getting ready to sell a $375k house in Greenville SC. I am thinking about throwing in the first 3 mortgage payments paid be me. I can give them 3 certified checks made out to their mortgage company. This would alleviate any concerns of the new owner being furloughed for a short while.
- 6yAvery CarlBusiness MemberReal Estate Agent · USA · Member since 2016 · 909 posts · 1k+ votes
Everything in @Alan Ford's post summed up what I was going to say.
Also, watch the Bigger Pockets youtube channel for data showing how Covid has affected occupancy rate by market. It should be published this week. But long story short: the data shows that in a worst case scenario, which in my opinion, we are in, the drivable regional vacation markets are far less affected than metro and fly-to vacation rental markets. Are we affected? Of course, but nothing can last forever and I don't foresee this being more than a 90 day problem with the accessibility and price point of vacationing in this market.
- Real Estate Agent · Sevierville, TN · Member since 2015 · 1k+ posts · 1k+ votes6y
Hey @John Craven! Congrats on your purchase! You're in a great position to take advantage of the coming wave of tourism. I think the info @Alan Ford posted is spot on. While short-term we're all feeling the effects like the rest of the world, there is every reason to expect that the Smokies will be one of the earliest and strongest markets to recover as things phase back into normal. Here's some additional things to consider:
- Historically, recessions have not had a significant impact on tourism in the Smokies; there was minimal to no dip over the Great Recession years. There is every reason to expect the same will be true again, for the reasons stated above
- We are in an area of the US that - so far - has not seen a very high rate of COVID-19 infections. This will allow us to phase back into "normal" life earlier than some other areas that have seen a higher impact, like New York and California, or destinations that see lots of crowding like major theme parks (Disney, Universal) and cruise ships
- We are very accessible and affordable for a majority of the population, and may even see an increase in traffic as people who would ordinarily travel to areas now considered higher-risk (overseas, any fly-to destination, aforementioned theme parks and cruise liners) are looking for alternative, safer destinations
- There's a wide variety of activities in the area that are outdoors and/or compatible with social distancing; the national park is the biggest, but there's horseback riding, zip lines, ATV/UTVs, river rafting/kayaking, fishing, the list goes on and on.
I have every confidence we'll see a strong recovery and one that occurs earlier than most. Also, since you have this window of time where there's no immediate guest demand, it's a great opportunity for handling any repairs or updates you may want to do, making sure your photos are great, tweaking your listings, etc. without the pressure of an immediate guest arrival. Of course we all want to be making money right now, but it's a great chance to invest time that will be a lot harder to come by later! :)
- 6yPaul CoxPro MemberRental Property Investor · Manassas, VA · Member since 2013 · 194 posts · 156 votes
We purchased our cabin back in November and put it on the vacation market just before Thanksgiving. We were doing very well even during the slow season and were pretty much booked through June. When the virus hit and the area started closing down, I got about nine cancellations to the tune of over 5K and then we just closed the Cabin down for the month of April. I still have bookings for May and June right now, but we'll see what happens with the opening of the area.
I honestly believe it's not an if, but a when it opens again scenario...If you follow the Facebook pages on the area, people are anxious to get there as soon as the restrictions lift. So, if you can carry the cabin with your W2 and have the reserves, I would say to just enjoy this quite time, get done to the cabin anything you'd like to have done and then buckle down for the onslaught that's going to happen as soon as the restrictions lift and things start opening again. Even if it goes into June or July, people will be back, and will want someplace to stay! Stay well and congratulations...
Paul
- Real Estate Agent · Sevierville, TN · Member since 2015 · 1k+ posts · 1k+ votes6y
Originally posted by @John Underwood:
I would see if you could postpone closing given the Pandemic. That will save some of your reserves.
They should be OK with that.
Also remember you won't owe your first mortgage payment for 60 days or so. At least time your closing to maximize this.I am getting ready to sell a $375k house in Greenville SC. I am thinking about throwing in the first 3 mortgage payments paid be me. I can give them 3 certified checks made out to their mortgage company. This would alleviate any concerns of the new owner being furloughed for a short while.
I don't understand the mindset of "the seller should be fine delaying closing". I don't see why a seller would choose to eat the holding costs just so a buyer doesn't have to. It's going to cost somebody money, and if I'm a seller I'm looking to close the deal as soon as possible. A seller may also have other things in the works that depend on closing by the agreed-upon date. There may be the occasional seller who's willing to do a favor, but I wouldn't recommend counting on it.
Re: offering to pay the first three months of mortgage payments, that's very generous and a good thought, however there are some logistical ramifications to that - primarily that the mortgage originator is very likely going to resell the note in the first month or two, and so before all three of those payments are due they'll need to be paid to a new servicer whose identity you will not know at closing. You could discuss an escrow option instead - more complicated setup, but may be better execution on the back end.
- 6yJohn UnderwoodPro MemberInvestor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
Originally posted by @Julie McCoy:
Originally posted by @John Underwood:
I would see if you could postpone closing given the Pandemic. That will save some of your reserves.
They should be OK with that.
Also remember you won't owe your first mortgage payment for 60 days or so. At least time your closing to maximize this.I am getting ready to sell a $375k house in Greenville SC. I am thinking about throwing in the first 3 mortgage payments paid be me. I can give them 3 certified checks made out to their mortgage company. This would alleviate any concerns of the new owner being furloughed for a short while.
I don't understand the mindset of "the seller should be fine delaying closing". I don't see why a seller would choose to eat the holding costs just so a buyer doesn't have to. It's going to cost somebody money, and if I'm a seller I'm looking to close the deal as soon as possible. A seller may also have other things in the works that depend on closing by the agreed-upon date. There may be the occasional seller who's willing to do a favor, but I wouldn't recommend counting on it.
Re: offering to pay the first three months of mortgage payments, that's very generous and a good thought, however there are some logistical ramifications to that - primarily that the mortgage originator is very likely going to resell the note in the first month or two, and so before all three of those payments are due they'll need to be paid to a new servicer whose identity you will not know at closing. You could discuss an escrow option instead - more complicated setup, but may be better execution on the back end.
As for me, I don't have a mortgage.
I am understanding and don't want to lose a qualified buyer. So I would assume the seller in this case may have some flexibility also and would like to keep a good buyer.
I'm sure there is a stay at home order or the like. You could say the attorney can't do closings until this is passed, which may be true.
I'm saying if you don't ask you will never know. All they can say is No and the the buyer can decide what they want to do.
- Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes6y
I live in the area and have for 26 years. I don't have any real great insight on the short-term rental market of GSP (Gatlinburg-Sevierville-Pigeon Forge) but I wanted to make a couple of comments about desirability.
The Great Smoky Mountains National Park has been here since 1934.
When I first moved here in 1994, you could rent a cabin in Gatlinburg for cheap - real cheap. There was virtually nothing in Sevierville and you only started hitting traffic when you got close to Dollywood, which wasn't nowhere near as built out as it is now. Most of the stuff in Gatlinburg wasn't there - it was a rickshaw conglomerate of old knick-knack and curio stores just hanging on. Since then, of course, the area has gone nuts with attractions, outlet stores, and the like.
My point is that the attractions is by and large what has drawn the massive tourist industry to the area. Yes, people like to see Clingman's Dome and do some hiking, and some kayaking, and fishing, but there's a lot of beautiful places and parks within driving distance that you can do that without suffering the crowds. If everything stays closed in Gatlinburg & Pigeon Forge I don't think you should expect to see tourism and occupancy based on hiking on the trail or visiting Cades Cove or Mt LeConte. Gatlinburg et al is just as dependent on the raft of "attractions" as virtually every other tourist attraction.
Skyline Properties Originally posted by @JD Martin:
I live in the area and have for 26 years. I don't have any real great insight on the short-term rental market of GSP (Gatlinburg-Sevierville-Pigeon Forge) but I wanted to make a couple of comments about desirability.
The Great Smoky Mountains National Park has been here since 1934.
When I first moved here in 1994, you could rent a cabin in Gatlinburg for cheap - real cheap. There was virtually nothing in Sevierville and you only started hitting traffic when you got close to Dollywood, which wasn't nowhere near as built out as it is now. Most of the stuff in Gatlinburg wasn't there - it was a rickshaw conglomerate of old knick-knack and curio stores just hanging on. Since then, of course, the area has gone nuts with attractions, outlet stores, and the like.
My point is that the attractions is by and large what has drawn the massive tourist industry to the area. Yes, people like to see Clingman's Dome and do some hiking, and some kayaking, and fishing, but there's a lot of beautiful places and parks within driving distance that you can do that without suffering the crowds. If everything stays closed in Gatlinburg & Pigeon Forge I don't think you should expect to see tourism and occupancy based on hiking on the trail or visiting Cades Cove or Mt LeConte. Gatlinburg et al is just as dependent on the raft of "attractions" as virtually every other tourist attraction.
Exactly right! A lot of folks are still underestimating the economic impact this pandemic has/will have. Yes, it will end at SOME Point. Yes, there will be "early returners". But given the ongoing and looming wave of unemployment, there simply will be far fewer people able and interested in taking vacations. Even if there are reasons to think the Great Smokies will be better off than other destinations (and that is a big "if", as @JD Martin wisely points out), there will be far less vacation travel for quite some time to come. We all hope that this will blow over soon, but to think we will be back to "normal" in 90 days is quite irrational. Things may start to recover in 90 days, but it will take years to be "back to normal". Don't want to sound depressing, but this thing is bigger than ANY of us have ever experienced.
- 6yAvery CarlBusiness MemberReal Estate Agent · USA · Member since 2016 · 909 posts · 1k+ votes
@JD Martin I encourage you to check out this data on tourism in the GSM National Park, which shows that 13 million tourists a year come for the park, with the dinner shows and other ancillary attractions being just that, ancillary. Those attractions were all developed to capitalize on the existing tourism driven by the park.
@Andrew S. The US has varying degrees of income. There is not a black and white all or nothing scenario. While some people won't be able to afford a vacation, many will, but will have to scale down and won't want to travel via plane/airport. Will those people be flying to Aspen? No, they will be scaling down and driving to their regional vacation markets, not just the Smokies. Yes, of course all markets are affected, but the degree to which they are affected varies widely. The more affordable, drivable markets are always going to be in better shape in these situations than the big fly-to markets.
- Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes6y
Originally posted by @Avery Carl:
@JD Martin I encourage you to check out this data on tourism in the GSM National Park, which shows that 13 million tourists a year come for the park, with the dinner shows and other ancillary attractions being just that, ancillary. Those attractions were all developed to capitalize on the existing tourism driven by the park.
@Andrew S. The US has varying degrees of income. There is not a black and white all or nothing scenario. While some people won't be able to afford a vacation, many will, but will have to scale down and won't want to travel via plane/airport. Will those people be flying to Aspen? No, they will be scaling down and driving to their regional vacation markets, not just the Smokies. Yes, of course all markets are affected, but the degree to which they are affected varies widely. The more affordable, drivable markets are always going to be in better shape in these situations than the big fly-to markets.
Hi Avery (I liked your podcast, btw). I'm not trying to rain on your parade here, I'm just stating what I see as reality as someone who has lived here for a very long time - I'm guessing almost as long as you've been alive :)
When I moved here in 1994 the GSM park had 8-9 million visitors a year. Back then the park visitation was about 9 million per year, a figure that held pretty steady up until about 4-5 years ago. So there was 9 million visitors back then but you could rent cabins in Gatlinburg for next to nothing. Why? Because there wasn't a whole lot going on in the area if you weren't hiking or day tripping into the woods. As Dollywood started expanding so did all the ancillary businesses around it. I promise you that if Dollywood closed up shop 50% of the businesses here would follow regardless of the 9-12 million people in GSM. Another thing - forget about the hard numbers of visitors and pay attention to traffic counts at park entrances. If you look at those numbers, you'll see there's not much difference from 1994 to today at most of the locations; the heaviest entrances are virtually the same almost 30 years later.
So in 1994 cabins - of which there were far, far fewer than there are today - could be rented for chump change - and today they're pretty expensive, relative to 1994 even factoring inflation - despite the fact that the park visitation in the GSP area isn't significantly different. So what changed? The build-out of GSP is what changed, largely spurred by heavier investment by Dollywood. Dollywood is open for about 8-8.5 months per year, depending on the weather - and last year had over 3 million visitors. The park essentially doubled in size since I've been here. All the extra people brought in for Dollywood also go to rodeo shows and visit Ripley's and do other stuff.
My point is that the mountains are popular but not the primary driver in the tourism boom. People don't stay in GSP just so they can spend 7 days looking at birds in the trees. They want to feel like they're in the mountains but they want to be able to drive down into town every day to go to shows, visit Dollywood, and eat at restaurants. I would bet money that the most popular cabins have the easiest access to GSP and have all the "amenities" like high-speed internet and cable/satellite tv, things that most "outdoorsy" people don't care all that much about since they're going to be standing in a river casting for trout all day. If for some reason the park was closed but everything else was open I don't think there would be much trouble with short-term rentals, whereas I believe the opposite is absolutely true.
PS: I love your GNR shirt :) . They were just coming out as I graduated HS.
Skyline Properties Originally posted by @JD Martin:
Originally posted by @Avery Carl:
@JD Martin I encourage you to check out this data on tourism in the GSM National Park, which shows that 13 million tourists a year come for the park, with the dinner shows and other ancillary attractions being just that, ancillary. Those attractions were all developed to capitalize on the existing tourism driven by the park.
@Andrew S. The US has varying degrees of income. There is not a black and white all or nothing scenario. While some people won't be able to afford a vacation, many will, but will have to scale down and won't want to travel via plane/airport. Will those people be flying to Aspen? No, they will be scaling down and driving to their regional vacation markets, not just the Smokies. Yes, of course all markets are affected, but the degree to which they are affected varies widely. The more affordable, drivable markets are always going to be in better shape in these situations than the big fly-to markets.
Hi Avery (I liked your podcast, btw). I'm not trying to rain on your parade here, I'm just stating what I see as reality as someone who has lived here for a very long time - I'm guessing almost as long as you've been alive :)
When I moved here in 1994 the GSM park had 8-9 million visitors a year. Back then the park visitation was about 9 million per year, a figure that held pretty steady up until about 4-5 years ago. So there was 9 million visitors back then but you could rent cabins in Gatlinburg for next to nothing. Why? Because there wasn't a whole lot going on in the area if you weren't hiking or day tripping into the woods. As Dollywood started expanding so did all the ancillary businesses around it. I promise you that if Dollywood closed up shop 50% of the businesses here would follow regardless of the 9-12 million people in GSM. Another thing - forget about the hard numbers of visitors and pay attention to traffic counts at park entrances. If you look at those numbers, you'll see there's not much difference from 1994 to today at most of the locations; the heaviest entrances are virtually the same almost 30 years later.
So in 1994 cabins - of which there were far, far fewer than there are today - could be rented for chump change - and today they're pretty expensive, relative to 1994 even factoring inflation - despite the fact that the park visitation in the GSP area isn't significantly different. So what changed? The build-out of GSP is what changed, largely spurred by heavier investment by Dollywood. Dollywood is open for about 8-8.5 months per year, depending on the weather - and last year had over 3 million visitors. The park essentially doubled in size since I've been here. All the extra people brought in for Dollywood also go to rodeo shows and visit Ripley's and do other stuff.
My point is that the mountains are popular but not the primary driver in the tourism boom. People don't stay in GSP just so they can spend 7 days looking at birds in the trees. They want to feel like they're in the mountains but they want to be able to drive down into town every day to go to shows, visit Dollywood, and eat at restaurants. I would bet money that the most popular cabins have the easiest access to GSP and have all the "amenities" like high-speed internet and cable/satellite tv, things that most "outdoorsy" people don't care all that much about since they're going to be standing in a river casting for trout all day. If for some reason the park was closed but everything else was open I don't think there would be much trouble with short-term rentals, whereas I believe the opposite is absolutely true.
PS: I love your GNR shirt :) . They were just coming out as I graduated HS.
Definitely some good points being made here. Especially when you said: "If for some reason the park was closed but everything else was open I don't think there would be much trouble with short-term rentals, whereas I believe the opposite is absolutely true". If you look back to the government shutdown in October 2013 (from October 1st to 17th) when the Great Smoky Mountains National Park was shut down, there was virtually no drop in rental incomes from cabins. Despite not being able to enter the National Park at peak leaf season. The Park is what initially drew investment and lodging here of course, but the attractions, retail, dining, etc is what has increased the visitation and created a different type of vacationing experience. Personally, it makes me sad that more people don't enjoy the National Park to hike, fish, etc instead of going to Tanger to shop all day. But that is just our times and culture more and more it seems.
- 6yAvery CarlBusiness MemberReal Estate Agent · USA · Member since 2016 · 909 posts · 1k+ votes
@JD Martin You are not the first and assuredly not the last person to bring up my age or gender when "explaining" something to me so I won't address that further. But what I will address is that EVERYTHING was cheaper in 1994. Real estate, sodas, etc. And virtually everything is more developed than it was in 1994 as well. Whether it's the Smokies or New York City. So it would be reasonable to infer that there are more attractions and industry in any market, and higher real estate and rental prices in any market, now than in 1994.
If 3 million people are going to Dollywood and 13 million are entering the park, that's still 10 million more people entering the park that are not going to Dollywood. Yes, of course Dollywood is a significant attraction, but using those numbers, it's still, while a very lucrative one, a supplementary attraction to the park.
@Account closed I am about to break ground on a $750,000 construction project ... no crickets here. I own two in the area already. Sure - my April and maybe May will be a fat loss. But that’s the cost of doing business.
- Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes6y
Originally posted by @Avery Carl:
@JD Martin You are not the first and assuredly not the last person to bring up my age or gender when "explaining" something to me so I won't address that further. But what I will address is that EVERYTHING was cheaper in 1994. Real estate, sodas, etc. And virtually everything is more developed than it was in 1994 as well. Whether it's the Smokies or New York City. So it would be reasonable to infer that there are more attractions and industry in any market, and higher real estate and rental prices in any market now than in 1994.
If 3 million people are going to Dollywood and 13 million are entering the park, that's still 10 million more people entering the park that are not going to Dollywood. Yes, of course Dollywood is a significant attraction, but using those numbers, it's still, while a very lucrative one, a supplementary attraction to the park.
I admire your enthusiasm and said nothing about your gender, but to pretend experience is meaningless is disingenuous. Yes, everything is more expensive than it was in 1994, but I noted that the price of cabins today is far more expensive even after accounting for inflation. That is something you cannot/do not know because (I assume, based on your podcast) that you did not live here or invest here in 1994. Further, the GSMNP extends over two states and not all of those visitors come through Pigeon Forge and Gatlinburg. A lot of "park" visitors come in through the Cherokee side of things in NC, where they spend their money instead of the stores in Gatlinburg.
I get that the majority of what you own & sell is in this area, so you have a vested interest in promoting the area. I live here in NE TN and the tourism is great for the economy. All I am simply saying is that the stores and attractions in the area are what bring the vast majority of people that are willing to spend money on cabins and short-term rentals in this area. I've only been around since 1994. Dolly bought the park that became Dollywood in 86 or 87. Talk to anyone that is from the area and lived here before then and they will tell you that the area was dead before then, despite the fact that there were 9 million visitors back then who weren't going to Dollywood because it didn't exist. When I moved here it was dead there despite the fact that there were 9 million people not going to Dollywood. If the pandemic keeps things shut down no amount of mountains is going to bring a flood of people into the area.
Skyline Properties - Real Estate Agent · Sevierville, TN · Member since 2015 · 1k+ posts · 1k+ votes6y
@Account Closed I don't know what the OP is buying, but I've got a new build 3BR in Gatlinburg under contract, and have two 4BR cabins under construction right now. That will bring my portfolio in the area to seven properties.
- Nashville, TN · Member since 2017 · 28 posts · 14 votes6y
Thank you everyone for all the responses! Didn't check my email for a bit and, as always on BP, am pleasantly surprised with the amount of responses and feedback.
I'm under contract on a 5bd/5ba new construction. Good to hear that other folks continue to move forward with purchases in the area, as I've obviously heard about a lot folks walking away from properties as well.
I think it's fair to say that both the GSMNP and the other attractions in Pigeon Forge and Gatlinburg are necessary to maintain recent STR performance. Regardless of whether you are a strong advocate for the area or not, I think everyone agrees that the closure of Dollywood or other attractions will have a negative impact on the area. The question obviously is to what extent and for how long.
- 6yAvery CarlBusiness MemberReal Estate Agent · USA · Member since 2016 · 909 posts · 1k+ votes
@JD Martin I did not intend to dismiss your experience. You are correct, I did not own property in this area in 1994 as I was six years old. Less than a third of my portfolio is in East TN, but my initial few investments were, and those are the pieces that got me to financial freedom as well as the funding for the other 70% of my portfolio in other markets/states, which is why I am so enthusiastic about them.
- Real Estate Agent · Sevierville, TN · Member since 2015 · 1k+ posts · 1k+ votes6y
Originally posted by @JD Martin:
Since when does someone have to live and/or invest in an area to know statistics and historical data? That's quite the assumption. Also, real estate prices are driven by much more than inflation, that's true of most real estate markets; why it appears to be the most important element of your value assessment I definitely don't understand.
I buy here because I make money. And even if things stay slow for awhile, I'll be fine; and if it slowly ramps back up, I'll still be fine and still making money, just perhaps not as quickly as before. If we recover quickly, great! If it's slow, I'm still okay, and it's not because I bought in 1994.
Of course there's a symbiotic relationship between the park and the attractions; I don't believe anybody is claiming that there would be no decline in tourism without them. However, I also don't believe that all of the restaurants and small businesses/attractions that are a part of that are going to be shut down indefinitely; they will phase back in to operation, some won't survive but plenty will. It'll take some patience but every investor needs to be prepared for ups and downs. This is not the Apocalypse.
How many STRs do you have in the area?
- Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes6y
Originally posted by @Julie McCoy:
Originally posted by @JD Martin:
Since when does someone have to live and/or invest in an area to know statistics and historical data? That's quite the assumption. Also, real estate prices are driven by much more than inflation, that's true of most real estate markets; why it appears to be the most important element of your value assessment I definitely don't understand.
I buy here because I make money. And even if things stay slow for awhile, I'll be fine; and if it slowly ramps back up, I'll still be fine and still making money, just perhaps not as quickly as before. If we recover quickly, great! If it's slow, I'm still okay, and it's not because I bought in 1994.
Of course there's a symbiotic relationship between the park and the attractions; I don't believe anybody is claiming that there would be no decline in tourism without them. However, I also don't believe that all of the restaurants and small businesses/attractions that are a part of that are going to be shut down indefinitely; they will phase back in to operation, some won't survive but plenty will. It'll take some patience but every investor needs to be prepared for ups and downs. This is not the Apocalypse.
How many STRs do you have in the area?
Looking up a statistic and living somewhere are two different animals. If you don't believe that, there's nothing I can say to you that would change your mind. Everything that can be known cannot be known simply by looking at a piece of paper or reading it on Google. I said in my very first line in this thread that I had little insight on the STR market of GSP but that I wanted to comment on the nature of tourism in this area. I own plenty of rentals but no STRs in Gatlinburg. Does that mean that my life experience here is irrelevant?
Apparently I've rained on the wrong parades here in STR land :)
Skyline Properties - Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes6y
Originally posted by @Avery Carl:
@JD Martin I did not intend to dismiss your experience. You are correct, I did not own property in this area in 1994 as I was six years old. Less than a third of my portfolio is in East TN, but my initial few investments were, and those are the pieces that got me to financial freedom as well as the funding for the other 70% of my portfolio in other markets/states, which is why I am so enthusiastic about them.
I think your enthusiasm is great. And I think Gatlinburg is a great area and relatively long-term stable, in comparison with other opportunities. I wish I had started better at your age instead of later. 🙂
Skyline Properties - Rental Property Investor · Sioux Falls, SD · Member since 2015 · 9k+ posts · 18k+ votes6y
Originally posted by @Julie McCoy:
Originally posted by @John Underwood:
I would see if you could postpone closing given the Pandemic. That will save some of your reserves.
They should be OK with that.
Also remember you won't owe your first mortgage payment for 60 days or so. At least time your closing to maximize this.I am getting ready to sell a $375k house in Greenville SC. I am thinking about throwing in the first 3 mortgage payments paid be me. I can give them 3 certified checks made out to their mortgage company. This would alleviate any concerns of the new owner being furloughed for a short while.
I don't understand the mindset of "the seller should be fine delaying closing". I don't see why a seller would choose to eat the holding costs just so a buyer doesn't have to. It's going to cost somebody money, and if I'm a seller I'm looking to close the deal as soon as possible. A seller may also have other things in the works that depend on closing by the agreed-upon date. There may be the occasional seller who's willing to do a favor, but I wouldn't recommend counting on it.
Re: offering to pay the first three months of mortgage payments, that's very generous and a good thought, however there are some logistical ramifications to that - primarily that the mortgage originator is very likely going to resell the note in the first month or two, and so before all three of those payments are due they'll need to be paid to a new servicer whose identity you will not know at closing. You could discuss an escrow option instead - more complicated setup, but may be better execution on the back end.
The mindset is simple. The current owner has a bad situation on their hands with COVID-19. The buyer can't be forced to buy the property. If the seller wants the deal to close, it would be in their best interest to work with the buyer. That means sharing some of the COVID-19 pain. If the deal falls through, they are stuck waiting weeks or months for the next buyer. It seems pushing out the closing a month is a far more appealing option. Another option is negotiating a sales price concession. I would ask for it if I was a buyer.
Maybe you have only been a realtor in a sellers market. Welcome to a buyers market, the rules change. John understands this which is why he is willing to offer a small concession to make sure the deal closes. Very smart in my opinion. I can tell you from reading the forums the last couple weeks that deals have been falling through left and right.
- Member since 2020 · 2 posts · 0 votes6y
@John Craven
Hey john,
I actually had a reservation with a group of people that was cancelled and it is supposed to be 2 months from now. I assume it’s going to be the same for the next 5 months
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