All Forum Posts by: Ryan Moyer

 Yeah I think we are coming around to this line of reasoning.  We were initially thinking 4-5 bedroom because it sounded like (from threads around here) that's where the sweet spot was on best returns, and also because that would be the sweet spot for us using the place with family once a year.

But yes, given it's our first investment property and it's out of state and we'll likely end up buying without even having a chance to visit the area first we're now thinking it might be better to start with something in the 2-3 bedroom range and ease into a larger property in the future once we've gained some experience.

I am confused by the last statement though about better returns in other areas of REI. I'd thought STR in Gatlinburg to be one of the better returns around, albeit with some extra work relative to most long-term options.

Thanks for the input!

Thanks for the insight everyone.  Lots of great info.  It sounds like buying an already built home is the way to go.

One other question about building in the area though, where I'm sure I'm missing something.  It seems like building might be a way to gain some easy/free equity in a home in the area, no?

For instance on realtor.com right now there are quite a few 4br, ~3000sqft cabins with modest or no views listed in the $750k-$800k range.  There seem to be plenty of lots of land similar to (if not better than) the ones those cabins are built on for around $60k.

So 3000sqft at $175 per sqft new build (is that about average for the area, or even a little high?) is $525,000.  Couple that with the $60k lot and you're at $585k which leaves $165k-215k left over to build the well and septic before you start approaching the prices that that size cabin seems to be selling for as a new build.  So conservatively budget $75k for the well/septic (again, that's probably on the high end, right?) and you're at $660k for the same cabin that is selling for $750k-$800k pre-built so you have $90k-$140k in equity already built in.

Then again maybe that equity isn't worth the lower cash flow that a higher mortgage payment would bring relative to buying a pre-built cabin (especially if the new cabins aren't pulling in higher rents than existing ones).  What price range should I be looking for in a 4-5 br cabin that already exists in the area?  They seem to be all over the place in pricing.

I'm very surprised to see Park City on the list.  We live right down the road from there and have run the numbers and they don't seem very doable.  Home prices are massively inflated and it's only a 2 season town.  The place is dead in spring and fall.

My wife and I are interested in an investment STR cabin (probably around 4-5 bedrooms, but would consider fewer for the right deal) in the Gatlinburg/PF/Sevierville area. I've spent the last week reading through pretty much all of the dozens of Gatlinburg area threads here on BP from the last few years, as well as browsing around the listings.

Prices have definitely inflated a good bit since those discussion threads started, and as I've seen people mention in the more recent threads margins are tighter now (but still good).  However one thing I noticed in browsing around was that land there seems to be exceptionally cheap.  Does that make new construction a reasonable alternative out there?  What are the prices to build like on those pre-fab log cabins in the area relative to the price of an existing cabin that may or may not have large capex items soon in the pipeline relative to new construction? 

I know people have mentioned in the threads that there is lots of new construction going on in the area.  Is any of it from BP investors?

But Evolve doesn't handle any of that.  The companies that handle that charge 40%, not 10%.

So are they bidding on cabins without seeing them in person?  Seems like that may be the only way to get a decent deal on one from out of state if things are moving that quickly.

Does that matter though?  If two investments are generating the same cash return wouldn't you rather have the one that provides an equity return as well? 

 Thanks Stefanie!

No real construction experience here, but your ideas are very helpful!

Oof.

This is like someone entering the NFL draft without knowing what a football is and then telling Tom Brady to go to hell when he tries to help you.

Are these still going in Ogden?