Selling a Smoky Mountain Vacation Rental: Exit Strategy Guide

The Smoky Mountain vacation rental market has been a gold rush for property investors. With the Great Smoky Mountains National Park attracting 13.2 million visitors annually—making it America's most-visited national park—cabins in Gatlinburg, Pigeon Forge, and Sevierville have generated impressive rental income.

But not everyone wants to stay in the game forever. Whether you're tired of property management, concerned about market saturation, dealing with regulatory changes, or simply ready to cash out your appreciation—this guide covers your exit options.

Smoky Mountain STR Market Overview

The Tourism Engine

The numbers are staggering:

• 13.2 million park visitors annually (2023 record)
• $3.85 billion spent in Sevier County in 2023
• 10+ million visitors to Pigeon Forge alone
• 2+ million Dollywood guests per year

Key Markets

Gatlinburg: Gateway to the park. 62% of park visitors pass through. Premium cabin locations with mountain views command top rates.

Pigeon Forge: Entertainment hub with Dollywood, dinner theaters, and attractions. Family-friendly vacation destination. Year-round demand.

Sevierville: More affordable entry point. Growing development. Central access to both Gatlinburg and Pigeon Forge.

Current Performance

Top-performing cabins generate impressive income:

• Premium locations: $50,000-$80,000+ annual rental income
• Average cabins: $30,000-$50,000 annual rental income
• Occupancy rates: 50-70% annual average (higher on weekends/holidays)

Why Owners Are Exiting

Management Fatigue

Running a vacation rental is work—guest communications, turnover cleaning, maintenance, reviews, pricing optimization. Even with a management company taking 25-35%, you're still involved. Some owners simply want out.

Market Saturation

The boom brought significant new construction. More cabins mean more competition for the same visitors. Some owners are seeing revenue decline as supply increases.

Regulatory Uncertainty

Local governments continue evaluating STR regulations. Changes to permit requirements, occupancy limits, or zoning can affect profitability and property values.

Cashing Out Appreciation

Many owners bought 5-10 years ago and have seen significant appreciation. With uncertain future growth, some prefer to lock in gains now.

Personal Circumstances

Life changes—health issues, retirement relocation, divorce, estate planning—create the need to liquidate vacation property.

Distance Challenges

Out-of-state owners find it increasingly difficult to manage properties remotely, especially when issues arise.

Your Selling Options

Option 1: Traditional Sale with Agent

Best for: Premium cabins, owners with time to wait

Process:

• List with a Smokies-specialist real estate agent
• Market to retail buyers and investors
• Showcase rental history and income potential

Timeline: 60-120+ days (slower in off-season)

Costs: 5-6% commission + staging + holding costs

Option 2: 1031 Exchange

Best for: Owners wanting to defer capital gains

How it works: Sell your Smoky Mountain property and reinvest proceeds into another investment property within 180 days. Defer all capital gains taxes.

Requirements:

• Must identify replacement property within 45 days
• Must close on replacement within 180 days
• Must use qualified intermediary
• Like-kind property (investment to investment)

Challenge: Finding replacement property in a tight timeline

Option 3: Cash Sale to Investor

Best for: Speed, certainty, selling during rental season

Advantages:

• Close in 7-14 days
• Sell with existing bookings—buyer honors them
• No showings disrupting rental income
• No repairs or upgrades required
• No commission costs

Price: 75-85% of market value (varies by property)

Market Timing Considerations

Seasonal Demand

Peak buying seasons:

• Spring (March-May): Buyers planning for summer rental income
• Fall (September-November): Buyers wanting holiday income

Slower seasons:

• Winter (December-February): Fewer buyers, but motivated ones
• Summer: Buyers distracted by own vacations

Market Outlook

The fundamentals remain strong—national park visitation isn't declining. However:

• Increased cabin supply continues
• Revenue per property may stabilize or decline
• Premium properties maintain value better
• Older/dated cabins face more pressure

When to Sell

Consider selling if:

• Your rental income has plateaued or declined
• You've captured significant appreciation
• Management burden outweighs returns
• You see better opportunities elsewhere
• Personal circumstances require liquidity

What Investors Pay for Cabins

Premium Cabins (85%+ of Value)

• Prime locations with mountain/park views
• Strong rental history ($50K+ annual)
• Recently updated interiors
• Desirable amenities (hot tub, game room, theater)
• Good reviews and repeat guests

Standard Cabins (75-85% of Value)

• Good locations, average views
• Solid rental history ($30-50K annual)
• Functional but dated interiors
• Standard amenities

Value Cabins (70-75% of Value)

• Less desirable locations
• Lower rental income or inconsistent bookings
• Needs updates or repairs
• Smaller/older properties

What Investors Want to See

• Rental income statements: 2-3 years of history
• Occupancy data: Booking calendars, seasonal patterns
• Expense records: Management fees, utilities, maintenance
• Review scores: Airbnb/VRBO ratings
• Property condition: Recent updates, maintenance history

Next Steps

1. Gather your records: Rental income, expenses, booking history
2. Evaluate your timeline: How quickly do you need/want to sell?
3. Consider tax implications: Talk to a CPA about capital gains and 1031 options
4. Get market feedback: Request cash offers to understand current investor interest
5. Compare options: Traditional sale vs. cash sale based on your priorities