As a savvy investor looking to diversify your portfolio, it’d be best to consider investing in log cabins rental properties in the Smoky Mountains. The region’s present economic climate is increasingly providing reasonable prices for second home and vacation cabin properties.
Cabins located in Tennessee provide excellent rental income with substantial cash flow. Suppose you’re considering purchasing a log cabin in the Great Smoky Mountains in East Tennessee; there are some things you’ll need to know to enable you to make a good, educated, and sound buying decision.
While most people intending to have log cabin investments in the Smoky Mountains believe that it’s a lucrative venture; it’s not that simple. Hence, we have put together this buying guide for people looking to invest in log cabins in the Great Smokies.
We will address the factors to consider while buying a log cabin and if the property can pay for itself. You can also visit https://theshorttermshop.com/log-cabin-investments-in-the-smoky-mountains/ for more information on log cabin investment in the Great Smoky Mountains.
When buying a cabin for investment, ensure you check the amenities seeing as it’ll greatly determine your rental income. Before people rent your log cabin, they’ll probably check the amenities online to see if it meets their requirements.
Some log cabins are located in resorts. Thus, they may have more amenities than those situated outside a resort. In a resort log cabin, some amenities include basketball, swimming pool, clubhouse, etcetera.
When you’re searching for a resort log cabin, be sure to know the amenities they offer. You can also see cabins with fire pits, indoor pools, theater, etcetera. While you’re not mandated to have all the amenities, it’ll help your rental income greatly if your log cabin rental is well equipped.
Location is vital in real estate, seeing as properties in better locations generate more revenue than others in not-so-desirable areas. Similarly, log cabins in great areas perform better in revenue generation than others.
Vacationers want a cabin that’s close to fun places they wish to visit. Therefore, ensure that the location is at the center of popular attraction sites before making log cabin investments in the Smoky Mountains. Your log cabin’s location will also determine greatly the revenue your investment will generate and its ability to pay for itself.
Property Management Companies
After buying your log cabin, you’ll need to find ways to rent it out. Many companies can help you manage your log home in the Great Smoky Mountains, or you can use Airbnb or VRBO and be your own property manager. Let’s discuss your options further.
Turnkey, Airbnb, and VRBO are the most popular in the Great Smokies. With their software, you can book and manage your rental property. However, you’ll be responsible for overnight rental taxes, maintenance, cleaning, marketing, etcetera.
Don’t fret; many independent companies can handle the maintenance and cleaning for you. You just have to find one out there amongst the mix.
Like we stated earlier, many rental companies can handle your log cabin investment property if you don’t stay close. These services have their own maintenance department, marketing staff, cleaning services, and reservation system.
However, these companies usually agree to a rental income split as the price for their services—for instance, a 60/40 or 70/30 with the property owner receiving the higher amount. The rental company will also pay the overnight rental taxes for you.
To discover the rental company to hire, consider doing a little research on Google, look at their websites and focus on the user-friendly ones. Also ensure that a guest can make a reservation easily from their site.
You’ll also need to interview the companies to see what they have to offer. Some professional rental companies might look at your log cabin and provide free tips on improving your rental income. Furthermore, they can estimate how much your log home will generate based on the available amenities.
Will My Property Pay For Itself?
Most first-time owners of log cabin investments in the Smoky Mountains worry about this question all the time. Owning a log cabin investment isn’t about finding a great cabin, renting it out, and cashing checks. You’ll need to pay some parts of your mortgage.
Understand that there are some months you won’t perform exceptionally. Contrastingly, there are some periods where you’ll get lots of money. Thus, your cabin investment might help you with the property mortgage but not cover it completely.
Another factor determining whether your cabin will make enough money to pay for itself is your financing option. Suppose you’re paying through a 1031 exchange or cash; you’re using the cabin’s rental income as your return on investment that will be achieved within a short time frame.
However, if you’re financing your log cabin from a lender, your down payment and interest rate percentage will influence your cash flow ability heavily. Most investors put down ten to 20 percent down payment. However, the more down payment amount you drop, the lower your repayment. Most importantly, it increases the chances of the rental log cabin paying for itself.
Log cabins are steadily coming back into fashion, and savvy investors are seizing the opportunity to buy into hot markets like the Big Smokies in Tennessee. Suppose you purchased secluded Smoky Mountains cabins for sale and are worried about recouping the amount spent on the purchase; worry not because all the areas in the Great Smoky Mountains are all hot tourist spots.
We believe you have all the information you need as a first-time investor in log cabin rental property from this article. Suppose you need additional information about the log cabin investment venture or the cabin market, please reach out to us through our website.
At The Short Term Shop, we love selling cabins and value the relationship that comes from finding great log cabins for our esteemed customers. Thus, we want all buyers to be educated and informed to ensure they make great educated decisions while buying a log cabin investment with our guidance.