The Smoky Mountains are a series of high, rugged peaks in the Southeastern United States, forming the border between Tennessee and North Carolina.
Smoky Mountains National Park protects 83% of The Great Smoky Mountain Range and is part of the Appalachian Mountain range. The National Park was established on June 15, 1934. It is 5,22,000 acres and is a UNESCO World Heritage Site.
It is a popular destination for hiking, backpacking, rock climbing, fishing, and camping. The Great Smoky Mountains National Park is one of America's most visited parks, with millions of visitors and more than 3 million acres of wilderness to explore each year.
History of The Smoky Mountains
The Great Smoky Mountains is one of America's crown jewels, with a history stretching back centuries. They are one of the oldest mountains on the planet, stretching more than 650 miles from central North Carolina to central Tennessee. They include 25 peaks, all above 6,000 feet.
The name comes from the natural blue mist or fog which sits atop the mountain range. The millions of plants inhabiting the mountain range make the fog. These plants give off volatile organic compounds that create a vapor and a bluish tinge when the gas molecules scatter blue light.
Thousands of years ago, glaciers advanced south and cooled the climate in the region. With the cold, plants and animals from the north also made their way into the region. When the glaciers receded, so did the forests. They were found only at the heights where cool moist conditions remained. Today a mixture of northern and southern animal and plant life are found.
Many of the coves and valleys were isolated and inaccessible. Places became more accessible in the 20th century when loggers began harvesting timber.
Since prehistoric times, humans have occupied and adapted to the climate and environment in the mountains. Most visitors only see the outside of the park – from the trailhead to Look Rock to Cades Cove – but exploring its many historic sites can reveal a great deal about the people that lived here long before they made their mark on this beautiful land.
Cades Cove is a valley in Townsend that preserves the story of the mountains. A popular destination for tourists to learn about the cultural history of prehistoric Indians to European settlers in the 18th century. Originally and until 1838, it was Cherokee territory as over 14,000 Cherokees were forced out of Southern Appalachians.
Cades Cove became an American settlement. Many remnants of the time, including cabins and churches, remain. President Franklin D. Roosevelt dedicated The Smoky Mountains National Park in 1940, "for the permanent enjoyment of the people."
Investing in short term rental markets
Investing in the rental market is considered to be a sound financial investment. It makes even more sense to invest in a property that you can use - a win-win situation, providing an added benefit and a financial return over time.
A big question first-time investors always ask is where and what to invest? And this is where investing in short-term rentals comes in.
Far from overcrowded tourist spots and sprawling urban destinations, what appeals to many vacationers is the country, nature, and quiet open spaces. One such place is The Smoky Mountains, where investing in short-term rentals is the way to boost first-time and seasoned real estate investor portfolios.
The short term rental market in The Smoky Mountains
The Smoky Mountains are one of the top short-term rental markets going into 2022 and have been over the last couple of years.
There are several reasons why, but The Smoky Mountains have always been a destination for people looking to get away from their busy lives. More so in the past few years, during pandemic times to escape and unwind to the beautiful weather and landscapes the mountains offer.
Now more than before, people are starting to see the fantastic opportunities that the area provides for short-term rentals. Let's uncover some of those reasons that make the Smoky Mountains the best short-term rental markets of 2022.
1. Nature, Adventure, And Attractions
What could be more attractive than the 'Smokies' as they are affectionately known. The park has a diverse area of vegetation that includes pine trees with thick undergrowth, shrubs, and trees, along with wetlands, creeks, waterfalls, and streams. Almost 95% is forest, namely Northern Hardwood forests, Spruce-fir forests, Pine-and-Oak forests, and Hemlock forests.
The Appalachian Trail enters The Smoky Mountains National Park from the south, is the world's longest walking trail and passes 14 states. Even for the most avid hikers, the 17 miles of the Appalachian can be challenging. For the best views, explore Clingmans Dome, the highest peak in the National Park.
At the border of The Great Smoky Mountains is the mountain-resort city of Gatlinburg - one of the top short-term rental markets. Over the past year, amid the pandemic, it has shown an average monthly increase of around 60% in rental income. And the trend is forecasted to increase as demand keeps spiking. The occupancy rate in Gatlinburg is 82%.
Attractions and festivals in Gatlinburg have made it a popular tourist destination. The Gatlinburg Skybridge, one of the longest pedestrian suspension bridges, offers the best view of The Smokies. Visitors can enjoy dining and shopping in Downtown Gatlinburg, the Gatlinburg Craftsmen's Fair, Farmer's Market, Harvest Festival, New Year's Eve Ball Drop and Fireworks Show, fly fishing, or sit back and relax. Some of the many reasons why vacation rentals have skyrocketed over the years - who wouldn't want to own a piece of this paradise!
Other popular mountainside towns include Sevierville and Pigeon Forge. Pigeon Forge is 'The Center of Fun in the Smokies.' There are endless attractions, including Tennessee's biggest: Dollywood. Owned by Dolly Parton, Dollywood is a theme park popular with families who prefer short-term rentals instead of hotels.
Sevierville is a true mountain town with a residential feel. Its proximity to The Smoky Mountains means it always reaches good occupancy rates for short-term rentals. Attractions in Sevierville include Sevier County Courthouse, Smoky Mountain Deer Farm & Exotic Petting Zoo, Forbidden Caverns, Tennessee Shine Company, Apple Barn, and Legacy Mountain Ziplines.
In recent years, the Smoky Mountains have become one of the top vacation destinations in America. With numerous attractions and events, it’s no wonder that so many tourists are flocking to Tennessee. The Smoky Mountains are becoming a more popular vacation destination each year, and according to The National Park, there were over 14 million visitors in 2021. As a tourist-heavy location, this area is a prime spot for short-term rentals and property management companies.
When you invest in vacation rentals in Gatlinburg, Pigeon Forge, or Sevierville, you’re investing in a community with high demand for visitors, a good walkability score, amenities, attractions, and a strong culture that leads to returning visitors each year.
3. Investment with a guarantee on rental income
In the past two years, the Airbnb scene has exploded in the Smoky Mountains. Between 2019 and 2021, millions of Airbnb guests have traveled to the Smoky Mountains National Park area. And that number is growing every year!
This is great news for investors because it means that your rental home will have high demand and consistent bookings. But when is a good time to buy?
With the rental market seeing an uptick, timing is crucial. And while the Smoky Mountains are an all-year-round vacation rental market, there are off-seasons. The months between January and March are less busy and the perfect time to shop around and get your property ready for peak season and rake in top dollar.
4. New to investing in the rental market
For first-time investors who have some savings, investing in a rental property is a good start for dipping your toes. It's cheaper to buy an investment home in the mountains than compared to the city. So it's a low-cost initial investment whose value appreciates with time.
The rental strategy for short-term rentals in The Smoky Mountains ensures a high turnaround and occupancy rate as it's open all year round. Your short-term rental investment could also double as a vacation home for you and your family.
The Great Smoky Mountain National Park is within a day's drive for one-half of the country's population. Getting around is also not a problem. The area is easy to navigate, and car rental options are available.
With the Great Smoky Mountains National Park on your doorstep and mountainside towns such as Pigeon Forge, Gatlinburg, and Sevierville, there's plenty to do, see, and experience that multiple vacations are needed. These towns are ranked as the most dependable rental markets in the US, raking in millions of visitors even in pandemic times.
Selecting where to buy can depend on how close you want to be to attractions. Properties nearby tourist attractions will come at a higher value but will also demand higher rentals, thus offsetting the cost over time.
6. Cabins and log homes
The pull of visitors to the Smoky Mountains goes beyond its natural beauty and splendor. Cabins and log homes have an appeal of their own. They are the most authentic way to experience the mountains and are ideal vacation properties in spring, summer, and throughout the year.
There is no shortage of cabins and log homes in The Smoky Mountains. Out in the mountains, cabins are the most common housing style, and they are the sought-after vacation rental property, after all, bringing in positive cash flows and passive income.
Cabins and log homes are found in Gatlinburg, Pigeon Forge, Sevierville, and Wears Valley. According to a report by vacation rental management company, Vacasa, Gatlinburg takes first place out of 25 markets for buying a vacation home in 2021. Undoubtedly, this shows that The Smoky Mountains are a top destination for visitors and, therefore, log cabins make suitable investments for short-term rentals.
Investing in the right cabin or log home as a short-term rental property should include an inspection, bank loan (or cash), cabin rental program, and a maintenance company or homeowners association.
The cabin isn't the only worthwhile investment. By offering visitors or guests plenty of amenities, your rental property can become a couples retreat, a family reunion, a sanctuary, or a remote workspace. Properties that are turnkey ready, furnished, and have amenities such as reliable internet, porches, large kitchens, fireplaces, hot tubs, and views, tend to do better with excellent returns on investment. Why not throw in recreational equipment to upgrade your amenities and rental potential.
7. No state income tax
Tennessee is one of seven states that do not charge state income tax. That means that you get to keep more of your profits. Tennessee does have a 7% sales tax.
Investing in a rental property in the mountains qualifies you for tax benefits, including tax breaks and deductions. On average, owners can expect 7-8% in pre-tax returns. For luxury cabins, this can be more.
The Smoky Mountains are a striking natural feature, but they're also a national park that's filled with unbelievable beauty, history, biodiversity, and investment potential. When you invest in a rental property, you are also investing in a second home or holiday home, financial security, in a little piece of pristine nature, and expanding your financial portfolio,
The statistics don't lie. The short-term rental market has seen a steady uptick, is fast-growing and showing no signs of slowing down. If you’re looking for a new market to invest in, look no further! No matter the location you are considering, The Smoky Mountains, with all its neighboring towns, have a property with your name guaranteeing amazing views, a substantial return on investment, and a holiday home to call your own. Don't miss out on this short-term rental goldmine.