It isn't the house...

I have folks every week run "deals" by me to gauge whether I think it is an OK deal. I love to help out when I can and give my opinion. 

One question I get asked a lot is, "What should I be looking for in a cabin"?  Right now, EVERYTHING is hot, hot, hot.  But just as certain as there are booms, there are also busts.  What happens when things bust?  What value does that cabin have when revenues are cut in half?  If you don't think that can and will happen, there's not much sense continuing to read this post.

But regardless of what the sunshine pumpers say, as the old George Harrison song goes, "All Things Must Pass."  When that day comes, you need to own a piece of real estate that has something that cannot easily be duplicated.  

In 2010, during the last bust, I was fortunate to be able to purchase a cabin on the Roaring Fork River near downtown Gatlinburg.  You cannot go anywhere inside this cabin where you do not hear the "roaring" of the river.  That sold me.  I bought it over the phone for the full as, at the time $210,000.  The tiny house was in horrible shape, but I wasn't buying a house; I was buying a location.  In 2016, the cabin was destroyed by fire, and I rebuilt a first class cabin, no expense spared.  

Yes, the cabin earns good rent.  But in the next bust cycle, while everyone is fire-selling their houses, this cabin will retain most of its value:  There have been very few houses sold along the Roaring Fork in the last 20 years.  They just don't change hands that often.

The moral of the story is, don't just buy a house.  Houses can be duplicated.  And eventually, supply will exceed demand, and we will have a downturn cycle that will last several years.  Try to find something that you just can't duplicate.  Lakes, rivers, views, provenance, historical value, etc.  

Those properties are out there - now get busy and find one!