Blue Ridge and Bryson City

[Matt Schreiber]

I’ve been looking to invest in Blue Ridge or Bryson City and I’ve noticed on the Blue Ridge side that really nice properties have been coming on the market for under $430,000 for the first time in the two years that I’ve been looking there. My question is when I go to Airbnb, I see amazing properties that are listed for $250 a night in the summer and they barely have any upcoming bookings. I’ve noticed similar results in Bryson City but slightly more booked in that area. I wanted to ask people that invest in this markets, Is it that people just book last minute in these areas or do you find that the demand is a little bit down? Thanks for any input 

[Kyle H.]

@Matt Schreiber I live and invest in Bryson City with 12 STR units currently in addition to a LTR portfolio, and have been on Airbnb with units since 2016. We basically saw a 25-30% increase of listings year over year the last two years which has saturated/diluted the market. I would say our local Realtors pushed some fairly unreasonable occupancy numbers to buyers and now they are all freaking out and dropping their prices or having their management drop prices. Demand is also down, I have my ear pretty close to the ground here and the majority of my friends and circle either own businesses here or have rentals and the consensus is that we are back to 2019 numbers +/- about 5%. The majority of my units are smaller and have typically rented more last minute but most of my peers here in town are seeing this trend with larger properties as well this year. Anecdotally I know of 4-5 people who have already transitioned from STR to LTRs here in the last couple months due to low occupancy. It will flush out here in my opinion in 12-18 months as most people will exit the market due to not coming close to occupancy numbers to feed the beast. I run all my pro forma numbers at 55% occupancy and have always been way above that but 20 and 21 were freakish in occupancy rates here outside of the moratorium we were slapped with (I ran over 90%). Everyone has their own way of running numbers but I have seen so many cabins sell here that wouldn't pencil out with any leverage even at high occupancy rates.