All Forum Posts by: Avery Carl

@Eric P. very very good point. This is why when talking about vacation rentals I prefer to speak in gross annual income terms only. Net can be so different from person to person and situation to situation. Gross numbers are the only way to compare apples to apples. I can tell you my net numbers on my properties, but that doesn't mean the next guy's net on a comparable property will be the same.

Hey Joshua! I have 5 rentals here.  I admittedly didn't own that far back.  However, it's my understanding that the tourism numbers were not parallel to the drop in home prices. The good thing about this market is that it's an inexpensive vacation. So in a downturn, an expensive vacation market like Aspen will take a harder hit than an affordable vacation market like the Gatlinburg, Pigeon Forge, and Sevierville (collectively the Smoky Mountain) market. Here is a link to year-over-year tourism data for this area. 

https://irma.nps.gov/Stats/SSRSReports/Park%20Specific%20Reports/Annual%20Park%20Recreation%20Visitation%20(1904%20-%20Last%20Calendar%20Year)?Park=GRSM

@Eric P. When people come to vacation in the mountains, they want it to feel like they are in the mountains. So as cabin-y of a vibe as possible. Cathedral ceilings/windows, tongue and groove walls, etc. I recommend as little drywall as possible, although there can be exceptions.

Hi @Eric P.! I can answer that.  This market is a true vacation rental market.  90% of the owners here are not investors like you and I are, they are just people who vacationed to the area and thought "I can have a cabin in the mountains and throw it on a local property manager so I don't have to pay my mortgage out of pocket." Those people just put their cabin on whichever local PM gave them the best sales pitch, and most of them charge 40% (although now they are doing "introductory" lower rates for the first year if you sign a 2 year contract. The least I have heard is 20%). So most of them aren't concerned with cash flow and are frankly lucky to break even on these local programs.  If you look at the listings most of the homes listed are with local PM's. You don't run into self-managed sellers as much, because those guys are cash flowing.

Also, keep in mind, not all of the properties that are currently for sale would make good rentals. When a really desirable one hits the market, it's usually gone within a few days, sometimes hours. There are exceptions and diamonds in the rough, but for the most part the good ones are gone very quickly.

I’ll text you!

Hey Andrey- call your state real estate commission and they can answer this question. The laws vary by state to state on what is considered property management or not. Some states require a license to co-host, and some don't. 

@Christian Brown?

Not sure where you are running into a problem as most of the properties around here are conventionally financeable, but the go-to lender here would be @Parker Borofsky.

@Chuck Kramer might have owned in this area that far back. 

250-300k will get you a 2 *maybe* 3 bedroom in Pigeon Forge. You can expect to gross (true gross, all monies coming in) $45k ish for a 2 to $55k ish for a 3. I hesitate to give out net numbers as everyone's net is going to be different. Some people will spend more money on capex than others (whether needed or not), some will utilize smart thermostats to keep the electric costs down while some will not, some will hire cleaners that cost more than others. Some won't vet renters as well and have more maintenance costs due to damages etc. The list goes on and on. The best thing to do is to narrow down what the basic expenses are for a property, and work down from there to find what the probable net for your personal management style will be.