This popular tourist destination in Tennessee has held up quite the strong housing market over the past years, but what’s in store for Gatlinburg real estate in 2020? Will it make for a smart investment?
Gatlinburg Real Estate Market Trends
What’s the best way to determine if a certain location makes for a smart investment? Well, data doesn’t lie so taking a look at the numbers will definitely help. Using Mashvisor’s investment property calculator, we’ve got the key data regarding Gatlinburg real estate investments in 2020. Let’s first go over that and then we’ll dive in deeper about what these trends mean.
Gatlinburg Housing Market 2020
- Median Property Price: $367,262
- Price Per Square Foot: $198
- Price to Rent Ratio: 21
- Average Days on Market: 142
- Monthly Traditional Rental Income: $1,472
- Traditional Cash on Cash Return: 2.0%
- Monthly Airbnb Rental Income: $3,833
- Airbnb Cash on Cash Return: 8.4%
- Airbnb Occupancy Rate: 70%
1) Gatlinburg Real Estate Prices Are Steadily Increasing
As you can see from the data listed above, the median property price for Gatlinburg real estate is currently $367,262. The average selling price is $300,000. Property prices in the Gatlinburg housing market have been steadily increasing. The average selling price is up by 3.5% from last year. The price per square foot is up by 38% since last year. Even though prices are up, homes are still being closed on. Some homes even get multiple offers.
2) Home Values Are Up By Over 8%
A surge in demand for Gatlinburg real estate has helped push home values up by 8.6%. According to Zillow, the Gatlinburg real estate market has cooled down a bit to a more balanced state. The median home value is currently $171,900, which is higher than the Tennessee median value of $168,600.
3) Real Estate Investors Can Earn a High Airbnb Rental Income
There’s clearly a big difference between the revenue generated from a short term rental property and a long term rental property in Gatlinburg, TN. And when you consider that it’s a popular destination among tourists, it makes sense for Gatlinburg vacation rentals to perform highly. Home to the only ski resort in Tennessee, Gatlinburg is most known for its beautiful mountain backdrop, as it lies on the border of the Great Smokey Mountains National Park. With over 11 million visitors hitting the National Park every year, Gatlinburg serves as the perfect gateway to the Smoky Mountains. With Airbnb rental income averaging at almost $4,000, this would clearly be a smart real estate investment.
Related: Short Term Rental Strategy: Best Cities for Airbnb Rental Income
But Is Airbnb Legal in Gatlinburg?
Before you start searching for Smoky Mountains real estate, you need to ask about any regulation on Airbnb Gatlinburg in 2020. Last year, the Tennessee General Assembly passed a bill to limit how far its cities can go in regulating short term rentals. And Gatlinburg is actually one of the best cities when it comes to lenient short term rental laws. This is one factor that also helps drive such a strong vacation rental market in Gatlinburg.
So yes, Airbnb is legal. But there are just a couple of Airbnb regulations for property owners wishing to operate a vacation rental in the Gatlinburg real estate market. First, you need to be registered with the city and get a business license and a tourist residency permit. Short term rental property owners also need to collect and remit the following taxes: 7% state tax and 2.5% county tax.
Related: 4 Best Cities to Invest in Tennessee Vacation Home Rentals in 2019
4) 0% Of Delinquent Mortgages
This is another factor making Gatlinburg real estate a smart investment- low mortgage rates. The chances of finding distressed properties or foreclosed Gatlinburg houses for sale are low. This reflects that most property owners are able to make their mortgage payments on time, and there are no negative trends driving Gatlinburg real estate properties to be repossessed by the bank.
So based on all of these positive real estate market trends, we can confidently say that you should invest in Gatlinburg real estate in 2020.
Related: Is Buying Foreclosures a Good Real Estate Investment Strategy?
Finding a Gatlinburg Investment Property
Simply choosing the best real estate market to invest in isn’t enough. If you want to generate some serious revenue and get a strong return on a Gatlinburg real estate investment, you need to choose the right rental property. What’s the best way to go about doing this?
Mashvisor’s Property Finder
Our property finder tool uses predictive analytics to find lucrative real estate investments for both traditional and Airbnb rental properties in any city. You can use this tool yourself to find the best investment properties by creating a free Mashvisor account.
This tool gives real estate investors the option to filter out search results based on their investment criteria. You can choose to search for a real estate investment in one city or multiple cities at the same time. Set your budget, rental strategy, property type, and the number of bedrooms and bathrooms. The best performing investment properties that match your criteria will pop up based on their performance in regards to list price, cap rate, cash on cash return, rental income, and occupancy rate. If you find a property you like, simply click on it to get a full real estate investment analysis including annual cash flow projections. Learn more about our Property Finder.
To show you just how profitable a Gatlinburg real estate investment can be in 2020, we’ve pulled up a couple of active listings for you to check out:
Investment Property #1
- List Price: $119,000
- Airbnb Cash on Cash Return: 27%
- Traditional Cash on Cash Return: 6%
Investment Property #2
- List Price: $129,000
- Airbnb Cash on Cash Return: 25%
- Traditional Cash on Cash Return: 3%
Investment Property #3
- List Price: $142,500
- Airbnb Cash on Cash Return: 15%
- Traditional Cash on Cash Return: 3%
Invest in Gatlinburg Real Estate Now
It would seem that an investment in Gatlinburg houses for sale will be a smart move for 2020. If you’re looking to start your search now so that you can be making money before the new year, start your 14-day free trial with Mashvisor and subscribe to our services with a 20% discount after by clicking here.
