Looking for STR owners in Gatlinburg or Pigeon Forge area

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Looking for STR owners in Gatlinburg or Pigeon Forge area

John Trollinger
Member since 2020 · 1 post · 0 votes

Looking to maybe invest in my first rental property there and am being given almost too good to be true rental income estimates and wanted to validate with real owners to see see if what I am being told by property managers and the realtor and builder are accurate.

thanks,

John

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Paul Sandhu
Investor · The worst town to live in, KS · Member since 2016 · 4k+ posts · 4k+ votes
6y
Originally posted by @Luke Carl:

Not too good to be true. It's just not for everyone. Just ask @Paul Sandhu 

Can you handle dead bodies, intruders, pet rattlesnakes that have escaped, drug overdoses, flat tires, lock outs, broken hot water tanks/washers/dryers/refridgerators, people having affairs with other tenants and the husband finds out, stray animals that get in your house, roof leaks, etc.  This is just a short partial list that I can think of off the top of my head.  Can you operate a chainsaw, riding mower, dump truck, skid steer, dozer, pole saw, weed eater and a carpet shampooer?  Do you have a RUP license (Restricted Use Pesticide)?  Can you perform the Heimlich maneuver and CPR correctly?  Can you stop bleeding from a deep flesh wound?  Can you reset a dislocated shoulder?  Can you reset a malfunctioning modulator/demodulator?  Can you harvest, clean and cook exotic wild game?  Can you load and unload a firearm in the dark with your non-dominant hand without discharging it?  Are you practiced in any offensive and defensive hand combat disciplines?

If the answer to any of these is "No" then perhaps a STR is not suited for you.

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  • John UnderwoodPro Member
    Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
    6y

    @Luke Carl @Avery Carl own multiple properties there.

    0Reply
  • Luke CarlPro Member
    Rental Property Investor · Tennessee Florida · Member since 2016 · 4k+ posts · 5k+ votes
    6y

    Not too good to be true. It's just not for everyone. Just ask @Paul Sandhu 

    You have to manage it yourself. If you think that's something you want to do.... it works! 

    Another problem... is much like the rest of the nation... there are way more investors than there is inventory right now. So be prepared for that. 

    Podcast Guest on Show From Surviving on $30/Day to 30+ Properties Thanks to Blue-Collar Skills
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  • Paul Sandhu
    Investor · The worst town to live in, KS · Member since 2016 · 4k+ posts · 4k+ votes
    6y

    Avery is also a Real Estate broker.  Her husband hangs out with rock stars on a yacht.  I hang out with ruffians associated with midstream oil production.

    1Reply
  • Paul Sandhu
    Investor · The worst town to live in, KS · Member since 2016 · 4k+ posts · 4k+ votes
    6y
    Originally posted by @Luke Carl:

    Not too good to be true. It's just not for everyone. Just ask @Paul Sandhu 

    Can you handle dead bodies, intruders, pet rattlesnakes that have escaped, drug overdoses, flat tires, lock outs, broken hot water tanks/washers/dryers/refridgerators, people having affairs with other tenants and the husband finds out, stray animals that get in your house, roof leaks, etc.  This is just a short partial list that I can think of off the top of my head.  Can you operate a chainsaw, riding mower, dump truck, skid steer, dozer, pole saw, weed eater and a carpet shampooer?  Do you have a RUP license (Restricted Use Pesticide)?  Can you perform the Heimlich maneuver and CPR correctly?  Can you stop bleeding from a deep flesh wound?  Can you reset a dislocated shoulder?  Can you reset a malfunctioning modulator/demodulator?  Can you harvest, clean and cook exotic wild game?  Can you load and unload a firearm in the dark with your non-dominant hand without discharging it?  Are you practiced in any offensive and defensive hand combat disciplines?

    If the answer to any of these is "No" then perhaps a STR is not suited for you.

    5Reply
  • Justin Anderson
    Property Manager · Pigeon Forge · Member since 2016 · 199 posts · 208 votes
    6y

    I own several and manage many  more and it is an amazing market.  Since May 1st, occupancy has been over 90% and rates continue to climb.  And on the acquisitions side, it's been nuts.  We're talking a dozen offers the same day something lists and with the property going for 50k over asking.  But if the cash flow is there and your numbers are good, it still makes sense.

    I've build a cabin revenue calculator so you can get a good idea based on the listings you're looking at.

    Good luck!

    0Reply
  • Erik Stenbakken
    Investor · Nortnern Colorado · Member since 2020 · 170 posts · 131 votes
    6y

    @John Trollinger Welcome to STR. I've worked with @Avery Carl and can tell you she DOES know that area. She found a house for me.

    RE earnings numbers. Yes. They can be real. But one thing to keep in mind when getting answers to "how much could this property make?" is that the answer is VERY dependent on a number of things. 

    1. What do you mean when you ask? And what do they mean when they answer? You may be thinking "cash flow" after all expenses, but likely the answer you'll get is "gross revenue" which often includes cleaning fees. One of my places costs $300 per clean, so adding 75 cleans is a pretty big number in the "what it earns -- but I don't keep" category. If you're asking apples, make sure the answer is in apples too. 

    2. How well you market, manage, and drive your STR. That matters a LOT. If you hire Auntie's Acres Cabin Club (hoping that's not a thing) to manage your property, you'll lose 40% of that "earning" before you ever see a dime.

    There are more of course, but that area really is strong for STR. And I've put my money where that opinion is.

    1Reply
  • Justin Anderson
    Property Manager · Pigeon Forge · Member since 2016 · 199 posts · 208 votes
    6y

    Yeah, cleaning fees and taxes are a really important distinction.  Those two can inflate your gross by 25% or more.  Most folks I talk to include cleaning but as an owner you need to drill down into the actual cash you get to keep. 

    Also, I'd (almost) completely ignore current revenue numbers since the vast majority of sellers either don't have them or have poorly managed the cabins. I'm talking making 50% less than it should poor.  What I would try to get a handle on is what they spent on repairs and maintenance.  You need to know if any big ticket items have been replaced recently and if there are plenty of $50/$100 service calls you know that they actually cared to take care of the place and fix things like sticking doors or toilet flappers.

    0Reply
  • Nancy Bachety
    Rental Property Investor · North Fork, NY · Member since 2016 · 1k+ posts · 631 votes
    6y

    @Justin Anderson Very cool calculator!

    1Reply
  • Julie McCoy
    Real Estate Agent · Sevierville, TN · Member since 2015 · 1k+ posts · 1k+ votes
    6y

    @John Trollinger I've got five in the area and the first three brought me financial independence.  @Erik Stenbakken and @Justin Anderson raise very valid points re: analyzing income numbers - and I'm going to add that past income should have a very small impact (if any) on your decision on whether to offer on a particular cabin.  Just about anything can perform well if it's handled and marketed correctly, even if it's five miles up a terrible gravel road or has an ugly neighbor etc. 

    Yes, you want to be able to figure out roughly how much cash flow you'll get off of a property.  But this is not a number anybody can give to you - it's something you've got to figure out yourself.  Nobody else can say what your mortgage is going to be, what cable package you're going to pay for, what extras (or not) you intend to provide, or if you go with the cheap thermostat so guests can abuse your HVAC or pay $200 for a smart one where you can set temperature limits.  

    So, learn to do your own analysis with basic expense info (PITI and utilities mostly, with some set aside for maintenance/capex; if you're including cleaning fees and taxes in your gross number, make sure you account for those expenses as well). Justin Anderson's calculator is great! Though you'll get more flexibility with a spreadsheet where you can tweak data inputs.

    2Reply
  • Collin HaysBusiness Member
    Property Manager · Gatlinburg, TN · Member since 2020 · 3k+ posts · 4k+ votes
    6y

    I am an investor and a property manager, both.  You will tend to get embellished stories from self managers and third party property managers.  You need to sift through all of that to get to the truth.

    Self managing is great, but don't let anyone tell you that you can hire someone in Bangladesh for $4 a phone call to take care of your guests.  That's baloney.  We manage 30 properties, and I have 2.5 FTEs to cover it.  I don't have those people because I like to employ people.  I have them because they are needed.  Calls in the night, locked out of the house, frig broken, no heat, snake under the hot tub, fireplace won't turn on, stuck in the driveway, and any of about a hundred other things.  We also take care of all monthly occupancy tax remittances - city, county, etc. - oversee housekeeping, pest control, and a variety of other things.

    A good property manager isn't charging 40 percent of your rents.  Maybe years ago but not today.  Probably more like 25% to 30%.  If they are good, they will earn it, you will be glad to pay it, and your property will be busier than it is with you renting it. Almost all of our clients are former self-renters, and it isn't uncommon for us to double their occupancy in the first year.  We just took over one in April that is owned by an attorney in Cincinnati.   Did about $11,000 last year, and we are already over $25,000 booked this year.  He simply didn't have the time to mess with it.  We have clients that have never even seen their property! 

    If you self manage, even assuming you could match the occupancy performance of a good PM, you are not saving yourself the entire management fee, by any stretch.  You are going to spend 6-7-8-9 percent of your revenues on marketing alone.

    I encourage self managing, but to do it right, it's a part time job. If you don't have time for another job, you might find that a good PM lets you enjoy being a STR owner without most of the hassle. Look at it as an annuity and each month you get your check direct deposited.

    [email protected]806-672-7102
    SMOKY MOUNTAIN FALLS INC.51 Review
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    1Reply
  • Luke CarlPro Member
    Rental Property Investor · Tennessee Florida · Member since 2016 · 4k+ posts · 5k+ votes
    6y

    @Collin H. To be fair if they were any good at self managing they wouldn’t be looking for a manager in the first place.

    There’s no professional manager that can come anywhere near my numbers. Although I would consider myself a professional manager that only manages properties I own.

    Podcast Guest on Show From Surviving on $30/Day to 30+ Properties Thanks to Blue-Collar Skills
    2Reply
  • Collin HaysBusiness Member
    Property Manager · Gatlinburg, TN · Member since 2020 · 3k+ posts · 4k+ votes
    6y
    Originally posted by @Luke Carl:

    @Collin H. To be fair if they were any good at self managing they wouldn’t be looking for a manager in the first place.

    There’s no professional manager that can come anywhere near my numbers. Although I would consider myself a professional manager that only manages properties I own.

     I would say you're a professional manager if I ever knew one!  ;)

    [email protected]806-672-7102
    SMOKY MOUNTAIN FALLS INC.51 Review
    WebsiteView Page
    2Reply
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