Last updated on June 21st, 2023
airbnb property investment Gatlinburg
Vastly known for its beautiful mountain views of East Tennessee, Gatlinburg has plenty of exciting activities and shopping centers that tourists will definitely enjoy. For property investors who are interested to invest a property in Gatlinburg, it’s highly recommended to learn about buying a property for Airbnb in order to make sure that it’s profitable.
To begin with, it’s certainly important to consider the major costs and revenue before deciding to purchase a property in Gatlinburg. Another excellent option is to do rental arbitrage in Gatlinburg City as it’s fairly popular and does not require you to purchase a property.
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“Gatlinburg tops the lists of many publications’ “Best Places to Invest for Short Term Rental Income“. This area does boast some of the highest cash-on-cash return numbers of any vacation rental market in the country.”
– The Short Term Shop on Gatlinburg’s Real Estate Investment
Aside from looking at a property’s fascinating architectural design, proximity to major tourist areas, and accessibility to the best go-to places, the primary step is to determine profitability. In this article, we’ll discuss the metrics in order to gauge the best property investment.
This includes the best website recommendations for property investment in Gatlinburg, property gross rental yield, cash-on-cash return, and annual revenue, along with some of the most ideal and profitable properties according to their location. Stoked to learn more? Continue reading!
Pros of buying an Airbnb Property in Gatlinburg
Also known as “Gateway to the Smoky Mountains”, Gatlinburg is full of exciting outdoor and cultural activities, so you will never get bored here as you will always have something to do! However, there’s more to learn as to why we recommend purchasing a property in this city. Here are some of the major reasons why you should consider buying a property for Airbnb in Gatlinburg:
1. Luxurious gateway all year-round
Looking to invest in tourist accommodations? Then, allow me to tell you that Gatlinburg is a perfect option for you! As the gateway to America’s most visited national park, Gatlinburg welcomes a great number of visitors throughout the year (around 14M) and thanks to this, the occupancy rate here remains high.
2. Don’t worry about high taxes!
Property taxes can give headaches to homeowners from time to time, but the good news here is that, in Sevier County, property tax is 0.40%, which is lower than the national average of 0.99%. In addition to this, there’s no state income tax!
3. Affordable cost of living
While Gatlinburg is certainly a popular destination, the cost of living here is quite affordable. Overall, it’s 13% lower than the national average!
What to Expect When Purchasing a Property in Gatlinburg?
Now that we know the pros of investing in Gatlinburg, let’s take a quick look at some of the cons. It’s always better to look at the two sides of each coin in order to properly set your expectations!
1. Finding affordable housing may be difficult
While the median house value in Gatlinburg is 13% lower than the US average, its prices are still high. In fact, if you’re with a tight budget, it may be quite hard to find a cheap property as the average housing price is $606K and it’s trending up 17.9% year-over-year according to Zillow Index.
2. Crime is a problem in specific areas
Before investing in a city, there will always be essential factors to consider aside from the property’s budget, such as safety. Sadly, Gatlinburg’s crime rate is higher than the national average, being this 41 per one thousand residents. Considering this info, it would be great to also look for a reliable housing security system while looking for an area of your preference.
Best Neighborhoods for Airbnb in Gatlinburg
Let’s take a closer look at the important Airbnb key metrics to discover which is the most profitable neighborhood in Gatlinburg. Filtered for a 1-bedroom apartment, here is a brief overview of some of the most recommended and profitable neighborhoods:
airbnb property investment Gatlinburg
1. Chalet Village
- Annual Revenue: $55,017
- Occupancy Rate: 83%
- Average Daily Rate: $157
2. Glade
- Annual Revenue: $59,585
- Occupancy Rate: 88%
- Average Daily Rate: $166
Is Property Investment Profitable in Gatlinburg, TN?
Using an Airbnb income calculator, it was discovered that a 2-bedroom apartment in Gatlinburg City Centre can generate an annual revenue of $41,020 with a steady occupancy rate of 57% and a nightly rate of $211.
airbnb property investment Gatlinburg
Properties & Homes For Sale in Gatlinburg, TN
Finding the best properties that have the potential to produce high yields and capital growth are certainly some of the preferences of major investors. It’s always best to ask for assistance from real estate agents to access exclusive and unique properties during the development stage.
At the same time, it’s even better when a property investor like you conducts research about predicted growths and market forecasts. Here are some of the profitable properties in Gatlinburg City Center along with the calculated gross rental yield, cash-on-cash return, and annual revenue:
4229 E Parkway Lot 190, Gatlinburg, TN 37738
1. Studio-type Property for Sale Gatlinburg
- 3.7 miles to Pittman Center Elementary
- Asking Price: $134,000
| GROSS RENTAL YIELD | 27.88% |
| ANNUAL REVENUE | $37,612 |
| CASH ON CASH RETURN | 53.26% |
4229 E Parkway, Gatlinburg, TN 37738
2. 1-Bedroom Type Property for Sale Gatlinburg
- 3.5 mile to Pittman Center Elementary
- Asking Price: $134,900
| GROSS RENTAL YIELD | 27.88% |
| ANNUAL REVENUE | $37,612 |
| CASH ON CASH RETURN | 57.88% |
4304 Little Creek Way Apt F, Cosby, TN 37722
3. 2-Bedroom Type Property for Sale Gatlinburg
- 0.6 miles to Smoky Mountain Elementary School
- Asking Price: $143,000
| GROSS RENTAL YIELD | 25.78% |
| ANNUAL REVENUE | $36,871 |
| CASH ON CASH RETURN | 51.58% |
4720 Mary Way, Cosby, TN 37722
4. 3-Bedroom Type Property for Sale Gatlinburg
- 2.2 miles to Jones Cove Elementary School
- Asking Price: $268,000
| GROSS RENTAL YIELD | 25.11% |
| ANNUAL REVENUE | $67,303 |
| CASH ON CASH RETURN | 49.57% |
615 Tank Hill Rd, Gatlinburg, TN 37738
5. 4-Bedroom Type Property for Sale Gatlinburg
- 0.8 miles to Gatlinburg Pittman High School
- Asking Price: $349,900
| GROSS RENTAL YIELD | 23.89% |
| ANNUAL REVENUE | $83,592 |
| CASH ON CASH RETURN | 45.90% |
Conclusion
Conducting market research in Gatlinburg is essential for accurate data and to know the potential profitability. With the variety of outdoor activities that attract a great number of visitors to Gatlinburg, it can certainly generate a nice cash flow for property investors. But still, it’s recommended to choose the correct neighborhood in order to avoid the areas with a high crime rate.
As long as the potential revenue is calculated using an Airbnb profit calculator, it’s definitely worth the time & effort to invest and speak with a short-term rental expert to make the wisest decision for property investment that you won’t regret.
