All Forum Posts by: John Carbone

Looking to buy an investment property that will be rented out. This will be bought in my name (and spouse)  and rented out under a sole proprietorship. I want to keep my spouse separate from the business so I can just file as a sole proprietorship with all income going to me. Can she legally be on the mortgage/deed but not be involved in the business aspect of renting it?

I’m aware of benefits of doing llc, but I do not want to do that based on my situation. I need to be sole proprietorship 

thanks

 Even with inflation, can ADR continue to rise in the smokies? Airdna lists revenue growth potential as being extremely low, and I tend to agree with them. This market has just undergone a total price discovery revaluation, and overall properties and rentals are priced to near perfection now.  ADR will not increase from this point at any substantial level (unless we get several years of high inflation). 2022 will likely be similar to 2021. I think you can expect to pay 9-10x revenue for a property (this was 5x 2 years ago). $1m will gross you 100-110k in gross rentals, and I don’t think there’s room to grow on this. Factor In your costs which have just gone up over the past week (mortgage rates have just spiked quickly by .50) and you are probably looking to net a profit of 40k on a million dollar purchase assuming 200k down. That’s still a 20 percent cash on cash, but your banking on no recession for 5-10 years. If things go south, at these purchase levels, there’s a real risk you could be renting for less than the mortgage. 

1. What kind of GRM are you targeting In the smokies now, and in general how difficult is it to get a financed deal through with an appraisal?

2. Are you worried about too much supply coming on the market?

3. I noticed a lot of “houses” are being sold in the smokies now that people are renting out pretty well. The price points are cheaper to purchase but they are not “cabins”. Do you think this is only due to Covid, and once the frenzy slows down it will revert back to primarily a “cabin” only destination?

Thanks

Hi Avery, I've been looking in Gatlinburg for a 4 bedroom 2800-3200 square foot cabin. These seem to have escalated rather quickly above $1m the past 6 months, are appraisals generally coming in on these? I would be doing 10% financing so trying to decide its worth enteraining an offer on a property like this without being a cash buyer. Any insight on the trend in appraisals for these type of properties?

1. What kind of GRM are you targeting In the smokies now, and in general how difficult is it to get a financed deal through with an appraisal?

2. Are you worried about too much supply coming on the market? 

3. I noticed a lot of “houses” are being sold in the smokies now that people are renting out pretty well. The price points are cheaper to purchase but they are not “cabins”. Do you think this is only due to Covid, and once the frenzy slows down it will revert back to primarily a “cabin” only destination?

Thanks 

Hi Avery, I've been looking in Gatlinburg for a 4 bedroom 2800-3200 square foot cabin. These seem to have escalated rather quickly above $1m the past 6 months, are appraisals generally coming in on these? I would be doing 10% financing so trying to decide its worth enteraining an offer on a property like this without being a cash buyer. Any insight on the trend in appraisals for these type of properties? Thanks!

I figured as such. This development has an HOA that would only allow 30 days or longer. The prices reflect this, which is why I was curious if there was any market for it. New construction 1800 square feet for like 300k.

Is there any demand for a minimum 30 day rental in the smokies? A new development started up that is allowing them. 

I know this area is the pinnacle of short term rentals, but never see anyone mention 30 day rentals. A quick glance at minimum 30 day stays on Airbnb/vrbo seem quite expensive (nothing less than 3-4K), does anyone book these?

Does anyone have any insight on this, or any feedback on if anyone has done 30 day rentals on your overnight rentals in the smokies?

thanks 

how bad is the shortage for cleaning crews in gatlinburg area? Are prices going up significantly?