Two-bedroom properties make up 36% of the vacation rental inventory in the area, and there’s a very consistent demand for properties of this size.The vacation rental industry is growing at an incredible pace and you might be thinking of getting in on the action. But investing in a vacation rental is a big decision. You need to understand the earning potential of your specific market to feel confident about renting out your vacation home or buying a property, but that information is hard to come by.
We’ve created our new Vacation Rental Performance Reports to help.
After digging into the data on thousands of vacation rental listings, our analysts have created a report that offers essential details on the revenue, occupancy, and nightly rates you can expect from renting out a second home.
Our first report focuses on the Smoky Mountains of Tennessee, which includes Gatlinburg, Pigeon Forge, and Sevierville. These sleepy mountain getaways have turned into some of the most successful short-term rental markets in North America and prospective buyers are paying attention for a number of reasons:
Our free Smoky Mountains Vacation Rental Performance Report will show you how much income owners in this area earn on average.
Tourism is the biggest contributor to this region’s success with vacation rentals. Huge attractions like Dollywood and the Great Smoky Mountains National Park have put these mountain getaways on the map. Not only that, but this region’s convenient location within driving distance of a number of major cities along the East Coast makes it a particularly attractive family vacation destination.
The Smoky Mountains draw over 11 million visitors annually.
With a steady stream of tourists flocking to the area every year, there’s a strong demand for accommodations – and short-term rentals have risen to meet that demand.
Vacation rentals might be a new phenomenon in urban areas, but they’re something of a tradition in the Smokies. There’s no shortage of historic log cabins that have been outfitted with modern amenities to create the perfect vacation home, and there are few restrictions preventing owners from making them available to visitors as short-term rentals.
If you’re considering a vacation rental, the Gatlinburg, Pigeon Forge and Sevierville markets are some of the safest places to invest.
Our research showed that the average vacation rental is hitting over 50% occupancy for eight months out of the year.
With average daily rates of $167 during the low season and $184 for high season, it’s easy to see how vacation rentals are generating a strong and steady cash flow.
These numbers may not be hugely impressive in another market, where real estate costs are sky high. But owners can secure a Smoky Mountain vacation rental property for a relatively low buy-in: the average 2-bedroom property is priced at about $167,000.
Two-bedroom properties make up 36% of the vacation rental inventory in the area, and there’s a very consistent demand for properties of this size.
The average yearly occupancy rate for two-bedroom vacation rentals in the Gatlinburg Area is 54%, and the return on investment is strong, with homes in this area earning an average annual rental income of $26,767.
It’s also worth noting that high-performing vacation rentals in the 75th percentile hit even stronger occupancy numbers throughout the year and command higher daily rates – check out our full vacation rental performance report to see those figures.
The difference between average and top-performers depends on a number of factors, including the quality of the property, the location, and the amenities. If you’re thinking about purchasing a vacation rental in this area, here are some of the key features that guests look for:
While small, medium, and large cabins all perform exceedingly well in the region, our data shows that vacation homes with these amenities generate more bookings throughout the year, at higher rates.
With low costs and strong returns, current owners and hopeful investors are paying close attention to this market. Gatlinburg, Pigeon Forge, and Sevierville are proving to be three of the hottest areas to own a vacation rental.
Looking to buy a vacation rental in this area? Have a property here already, and want to outperform the competition?
Download our free 2018 Vacation Rental Performance Report for the Smoky Mountains of Tennessee to find out about: