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- Property Manager
- Gatlinburg, TN
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Smokies "hiney showing" thread
We have officially entered the "Hiney Showing" phase in the Smokies. That is, homes being offered for less than what was paid for them very recently. It's all a part of the boom/bust real estate cycle in resort areas. The inevitable end to "But this time it's different" chants.
I'll be posting these as I see them.
Here's the first. No further bookings in April or May. It was purchased for $2.4 million in 2022. Asking $2.25 million today, and offering $20K in "buyer credits".
3385 Birds Creek Rd, Sevierville, TN 37876 | MLS #1256702 | Zillow
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Property Manager
- 806-672-7102
- http://www.CabinsNearGatlinburg.com
- [email protected]
I stayed at one of the newer hotels in Gatlinburg last night and there were only six people there, including myself. I also drove around chalet Village and I would say 60 to 70% of the cabins did not have cars parked in front of them.
Quote from @Kyle Smith:
I stayed at one of the newer hotels in Gatlinburg last night and there were only six people there, including myself. I also drove around chalet Village and I would say 60 to 70% of the cabins did not have cars parked in front of them.
Well I hit Cades Cove this morning at 7:30am to try and photograph some bears. Went around the loop twice and when I came out about 11:15am, the line getting in to the cove was backed up over a mile beyond the entrance. I don't know where all these people are staying, but they are staying somewhere. I don't know that I have seen the line that far out before, of course I always hit it early in the morning.
Quote from @Wilson Hunter:
Just did a search and saw that the Carls went dark on Sep 25th, 2023. Weird…
they don't want that Smoke... (no pun intended)
PS: they're on that YT revenue now
#1 Rehabbing & House Flipping Contributor
- Residential Real Estate Agent
- Irvine, CA
- 993
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#1 Rehabbing & House Flipping Contributor
- Residential Real Estate Agent
- Irvine, CA
Quote from @Collin H.:
We have officially entered the "Hiney Showing" phase in the Smokies. That is, homes being offered for less than what was paid for them very recently. It's all a part of the boom/bust real estate cycle in resort areas. The inevitable end to "But this time it's different" chants.
I'll be posting these as I see them.
Here's the first. No further bookings in April or May. It was purchased for $2.4 million in 2022. Asking $2.25 million today, and offering $20K in "buyer credits".
3385 Birds Creek Rd, Sevierville, TN 37876 | MLS #1256702 | Zillow
Joshua Tree already felt this for the past 12-18 months, unfortunately... In early 2022 (Jan/Feb) there were 45 properties on the market... two months later 80 and five to six months later 160-170..
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Real Estate Agent Ca (#01968986)
- The McKernan Group
Quote from @Kyle Smith:
I stayed at one of the newer hotels in Gatlinburg last night and there were only six people there, including myself. I also drove around chalet Village and I would say 60 to 70% of the cabins did not have cars parked in front of them.
Seems normal for May. It’s always been our third slowest month of the year at all of our Smokies properties. I’m not surprised and don’t see a need to be concerned yet based on our June and July bookings so far
@Collin Hays Million dollar question is, when will we see the bottom?
Quote from @Kyle Wise:
@Collin H. Million dollar question is, when will we see the bottom?
When your Uber driver tells you that he's selling and never buying a vacation rental again.
#4 All Forums Contributor
- Lender
- Lake Oswego OR Summerlin, NV
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#4 All Forums Contributor
- Lender
- Lake Oswego OR Summerlin, NV
Quote from @Kyle Smith:
I stayed at one of the newer hotels in Gatlinburg last night and there were only six people there, including myself. I also drove around chalet Village and I would say 60 to 70% of the cabins did not have cars parked in front of them.
mid week this time of year do you expect more occupancy ?? do they get many business travellers ?
#5 Market Trends & Data Contributor
- Investor
Quote from @Kyle Wise:
@Collin H. Million dollar question is, when will we see the bottom?
In STR markets-- I am going to take a stab at it and say Q4 2024.
Quote from @Ken Boone:
Quote from @Kyle Smith:
I stayed at one of the newer hotels in Gatlinburg last night and there were only six people there, including myself. I also drove around chalet Village and I would say 60 to 70% of the cabins did not have cars parked in front of them.
Well I hit Cades Cove this morning at 7:30am to try and photograph some bears. Went around the loop twice and when I came out about 11:15am, the line getting in to the cove was backed up over a mile beyond the entrance. I don't know where all these people are staying, but they are staying somewhere. I don't know that I have seen the line that far out before, of course I always hit it early
I don’t know. All I know is, I went land prospecting and there were a lot of empty cabins up on Chalet and several other areas.
Just chiming in. We have a big cabin that sleeps 16. We have 1 guest for May so far. Very quiet right now. Last year was light too. 16% occupancy this year vs. 38% in May last year.
We haven't adjusted our rates to race to the bottom because we're financially healthy. That one stay has already covered our mortgage. And we don't want to deal with the headache of attracting guests that will mess up the house.
#4 All Forums Contributor
- Lender
- Lake Oswego OR Summerlin, NV
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#4 All Forums Contributor
- Lender
- Lake Oswego OR Summerlin, NV
Quote from @Matt Mertz:
Just chiming in. We have a big cabin that sleeps 16. We have 1 guest for May so far. Very quiet right now. Last year was light too. 16% occupancy this year vs. 38% in May last year.
We haven't adjusted our rates to race to the bottom because we're financially healthy. That one stay has already covered our mortgage. And we don't want to deal with the headache of attracting guests that will mess up the house.
if you can get one stay to pay your overhead.. thats what I would do. keeps the wear and tear down a lot.. if STR client pays your mortgage off thats great news..
Quote from @Jay Hinrichs:
Quote from @Matt Mertz:
Quote from @Jay Hinrichs:
Quote from @John Carbone:
A few days ago it was looking pretty decent, but then we had a guest cancel a 7 night stay in June due to a medical emergency.
2024: June 26%, July 58%.
2023: June 70%, July 51%
We donated a 3 night weekend to Isaiah House for a fund raising raffle so I didn't include them in the June 2024 numbers. And we gave a few nights to a friend in July 2023.
We're in this weird place where we were doing better this year than last until May rolled around. We're not panicking or anything. It's just "will we be able to retire early or not?"
Quote from @Matt Mertz:
Quote from @John Carbone:
A few days ago it was looking pretty decent, but then we had a guest cancel a 7 night stay in June due to a medical emergency.
2024: June 26%, July 58%.
2023: June 70%, July 51%
We donated a 3 night weekend to Isaiah House for a fund raising raffle so I didn't include them in the June 2024 numbers. And we gave a few nights to a friend in July 2023.
We're in this weird place where we were doing better this year than last until May rolled around. We're not panicking or anything. It's just "will we be able to retire early or not?"
Would you say that revenue for June and July is similar to last year or down assuming you didn’t have the cancellation?
I’m hearing from a lot of people that they have a bottom line number before they will just let it sit. If there are enough hold outs, new construction may become non existent and it may just be a few years of poorer performance. The long run will play out very well but it’s going to take some medicine to get to the other end.
Quote from @John Carbone:
I’m hearing from a lot of people that they have a bottom line number before they will just let it sit. If there are enough hold outs, new construction may become non existent and it may just be a few years of poorer performance. The long run will play out very well but it’s going to take some medicine to get to the other end.
May is the weird outlier. Currently May 2024 is only 1/3 of last year. Of course there's still time for some last minute bookings.
We use Pricelabs and haven't migrated to the new algorithm because it was pricing consistently lower than the original one. I only mention this to demonstrate that, in our case, we didn't have to lower prices to get our expected bookings. We're ok with riding it out for now and seeing what happens. Of course we may be forced by the market to lower rent at some point.
I can share an anecdote concerning construction prices. We've been trying to build a 1 bedroom in Gatlinburg since the beginning of 2023. October 2023 our builder gave us a ridiculous construction estimate so we pulled the plug (basically all the trade work was as expensive for a 1 bedroom as our 4 bed we built in 2021). Recently he asked us if he could reprice the construction with current prices. He said the interest rates have been scaring off new construction so prices have been coming down.
I don't think new construction will ever stop but it is slowing down, which is good news for us. Personally I don't know how people who entered this market with the high interest rates are making it. There's going to be some weird churn in the Smokies market for a few years.
@Collin H. Spot on! Yet there are some realtors in the area that continue to preach that there is no oversaturation and things are great. I’m watching a couple of cabins near one of mine that have been on the market for nearly a year at $750k (and not renting well – the owner now has them down to $150 a night). There are going to be some great opportunities in another year or two, but with the insane amount of building that’s still going on you are going to have to be able to hit your numbers at ADRs that are half of what you would’ve gotten a couple years ago. Good friend of mine owns 10 and has been in the market for 15 years. This is the worst he’s ever seen in terms of revenue. 
- Property Manager
- Gatlinburg, TN
- 2,927
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- 2,086
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Quote from @Mark S.:
@Collin H. Spot on! Yet there are some realtors in the area that continue to preach that there is no oversaturation and things are great. 
Realtors don't get paid until they sell. They have their place (some of the time) in real estate transactions, but it's best not to rely on the advice of someone for advice on real estate, who gets paid only when you buy or sell. Therein lies an inherent conflict of interest.
Just like asking a car salesman if it's a good time to buy a car, a stockbroker if it's a good time to buy stocks, or an insurance professional if it's a good time to buy life insurance or an annuity.
I have been overall bearish on new buys in the Smokies for about two years now - I have been warning about a correction since early 2022 on this very forum and was, at least initially, lampooned by the majority. I don't really care. But a quite high profile "Pied Piper" of investing in short term rentals contacted me late 2022 and chided me for being too negative on the BP forum. "You're never going to make any money doing that", "I'm sorry things are so gloomy for you", and "you might ask your doctor for an antidepressant."
We can get ourselves into a lot of trouble when we trade morals, ethics, and common sense, for greed and profit. It usually doesn't have a happy ending for those affected and/or inflicted by such.
When the cards come tumbling down, the Pied Piper is often on to pumping the next big thing, while leaving a wake of stress and financial destruction behind.
Long term, the Smokies are an EXCELLENT investment for most. For some, the prices that were paid in 2021-23 will not allow the investment to EVER work. That is most unfortunate.
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Property Manager
- 806-672-7102
- http://www.CabinsNearGatlinburg.com
- [email protected]
#5 Market Trends & Data Contributor
- Investor
Quote from @Collin H.:
Quote from @Mark S.:
@Collin H. Spot on! Yet there are some realtors in the area that continue to preach that there is no oversaturation and things are great. 
Realtors don't get paid until they sell. They have their place (some of the time) in real estate transactions, but it's best not to rely on the advice of someone for advice on real estate, who gets paid only when you buy or sell. Therein lies an inherent conflict of interest.
Just like asking a car salesman if it's a good time to buy a car, a stockbroker if it's a good time to buy stocks, or an insurance professional if it's a good time to buy life insurance or an annuity.
I have been overall bearish on new buys in the Smokies for about two years now - I have been warning about a correction since early 2022 on this very forum and was, at least initially, lampooned by the majority. I don't really care. But a quite high profile "Pied Piper" of investing in short term rentals contacted me late 2022 and chided me for being too negative on the BP forum. "You're never going to make any money doing that", "I'm sorry things are so gloomy for you", and "you might ask your doctor for an antidepressant."
We can get ourselves into a lot of trouble when we trade morals, ethics, and common sense, for greed and profit. It usually doesn't have a happy ending for those affected and/or inflicted by such.
When the cards come tumbling down, the Pied Piper is often on to pumping the next big thing, while leaving a wake of stress and financial destruction behind.
Long term, the Smokies are an EXCELLENT investment for most. For some, the prices that were paid in 2021-23 will not allow the investment to EVER work. That is most unfortunate.
Out the pied piper. It better not be the short term rentals are recession proof fella.
Quote from @Matt Mertz:
Quote from @John Carbone:
A few days ago it was looking pretty decent, but then we had a guest cancel a 7 night stay in June due to a medical emergency.
2024: June 26%, July 58%.
2023: June 70%, July 51%
We donated a 3 night weekend to Isaiah House for a fund raising raffle so I didn't include them in the June 2024 numbers. And we gave a few nights to a friend in July 2023.
We're in this weird place where we were doing better this year than last until May rolled around. We're not panicking or anything. It's just "will we be able to retire early or not?"
Next 30 Days: 55.91%
Next 60 Days: 55.74%
Next 90 Days: 45.65%
Last Year Weeks 3 and 4 of April were my best booking weeks. This year week 3 and 4 are down roughly 50% on overall reservation. Largest booking week for me was Jan week #2.
I'm AB testing cancellation policies between Strict and Super Strict 60 and I have not noticed any difference in bookings. Given the current market for last minute pricing being much lower, I have my doubts that having a more lenient cancellation and would prefer the strictest possible. What are you guys using?
- Property Manager
- Gatlinburg, TN
- 2,927
- Votes |
- 2,086
- Posts
This one sold for $432K in 2021. It's now at $399K. No way it will bring that, of course.
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Property Manager
- 806-672-7102
- http://www.CabinsNearGatlinburg.com
- [email protected]
Quote from @Collin H.:
This one sold for $432K in 2021. It's now at $399K. No way it will bring that, of course.
Wow if they can get out above 250k I would be surprised.
Quote from @Collin H.:
We have officially entered the "Hiney Showing" phase in the Smokies. That is, homes being offered for less than what was paid for them very recently. It's all a part of the boom/bust real estate cycle in resort areas. The inevitable end to "But this time it's different" chants.
I'll be posting these as I see them.
Here's the first. No further bookings in April or May. It was purchased for $2.4 million in 2022. Asking $2.25 million today, and offering $20K in "buyer credits".
3385 Birds Creek Rd, Sevierville, TN 37876 | MLS #1256702 | Zillow
Oh god, this is astonishing. I've seen a couple of houses like that, but I didn't know it was a thing! It was inevitable, I guess... It happens all the time with economic investments... They overvalue and then there's a big drop, then the market giants look for another commodity. Why wouldn't it happen to properties like that?