All Forum Posts by: Tim Schroeder

I mean my third cabin, not third in Shagbark!

@Joshua Feit I am looking at buying my third in Shagbark, but am worried that it's too far out to get the occupancy I want. I have a big one right in PF and the returns have been phenomenal, plus another further east and the jury is still out on that one. How do you like Shagbark so far?  I guess it's too early to know about occupancy, since we're in the low season and you just got started.

Welcome @Joshua Feit and congrats. I have two and looking for #3. Spent last night doing the books and my ROI has been incredible. Couple of suggestions if you don't already know -- have Avalara MyLodge handle your local occupancy tax submissions ($20/mo). Use OwnerRez.com for consolidated messaging, rates, email automation, and more. Wix.com for a website if you want to take direct bookings and save on fees, keep your cleaners happy (pay them well and tip at Christmas, etc), join the Smoky Mountain Owners Facebook group which is chock full of helpful people.

Oh, and if your HVAC unit is more than 6-7 years old just replace it. HVAC has been my #1 problem.

Good luck!

What they said. But, include a NetFlix and Hulu account. That's only like $25/month. Roku is best. You can also but TCL TV's that have Roku built in -- and they are cheap!

Just tell your lender what you want to do and they should be able to tell you if the numbers work. Meaning, whether your DTI (debt to income) ratio will be too high to get the 2nd loan. You definitely want to be thinking about this in advance. Secondly, call your cabin a "second home" not an investment. Your loan terms will be better. Finally, my advice is don't buy a condo when there are so many nice cabins in that area.

When people pay a cleaning fee, they expect that someone will cleanup their toothpaste, food, and other mess. It's part of the deal. If they don't break anything, they deserve 5 stars.

Yes to cleaning fees. Every dime you spend is deductible. 

Technically, some items should be capitalized and depreciated, such as furniture. Not sure about appliances but I suspect they'd fall into the furniture category. Whenever possible, I categorize things as supplies or furnishings (pictures, decorations, silverware, etc) so they come off the taxable profit that year instead of being spread over a few years as depreciation.

Once you've closed you can join this great Facebook group https://www.facebook.com/groups/smokymountainsrent...

which is comprised of other Smoky Mountain cabin owners and is full of people who can recommend all kinds of services.

Yes, cleaning fees are always taxable in terms of occupancy tax. Because a cleaning fee is really just income under a different name. It's a way to increase revenue without raising the daily rate. For example you could charge for linens, or for electricity, or permission to sit on the couch, or a portion of the property taxes. All of this is income. Whether there is an expense behind it (paying your cleaners) is irrelevant. Personally, I charge 220 for cleaning but only pay my cleaners 180. This is a common and  legit practice. Anywayre not paying the tax, your guest is. You are collecting it on behalf of the local governments. It is exactly like sales tax. If you're not adding this for each booking, you probably should be.

Exciting idea. I would love to hear how this turns out.