Is Great Smoky Mountains, Tennessee Good for Airbnb Investment?

To start an Airbnb in Great Smoky Mountains, Tennessee, begin by researching local regulations as Sevier County requires short-term rental permits and business licenses, with properties needing to comply with zoning laws that vary between Gatlinburg, Pigeon Forge, and unincorporated areas. Obtain necessary permits including a Sevier County short-term rental permit ($200-400 annually), Tennessee business license, and ensure fire safety inspections are completed. Find property by focusing on areas within 10-15 miles of Great Smoky Mountains National Park, considering cabin rentals which are popular, with average purchase prices ranging $300,000-800,000 depending on size and location. Furnish the property with mountain-themed decor, hot tubs (highly desired), full kitchens, fireplaces, and outdoor amenities like fire pits, ensuring capacity matches local occupancy limits (typically 2 people per bedroom plus 2). List your property on Airbnb, VRBO, and local platforms like Cabins USA or American Mountain Rentals, with competitive pricing averaging $150-400 per night depending on season and amenities. Manage the property by either self-managing or hiring local companies like Aunt Bug's Cabin Rentals or Timber Tops Luxury Cabin Rentals (15-25% management fees), ensuring 24/7 guest support, professional cleaning between stays, and maintaining compliance with evolving county regulations including parking requirements and noise ordinances that are strictly enforced in this tourist-heavy region.

To identify profitable short-term rental properties in the Great Smoky Mountains, Tennessee, focus on locations within 15-30 minutes of Gatlinburg, Pigeon Forge, or park entrances, prioritizing properties with mountain views, creek access, or secluded wooded settings. Target 3-6 bedroom cabins with hot tubs, game rooms, fire pits, and modern amenities like WiFi and updated kitchens, as these command premium rates of $200-500+ per night depending on size and luxury level. Conduct pricing analysis using AirDNA, Mashvisor, or STR data tools to identify properties generating $40,000-80,000 annually with occupancy rates above 60%, while analyzing comparable listings within 5-mile radius to understand seasonal pricing patterns and peak demand periods during fall foliage, summer vacation, and holiday seasons. Research competition density using Airbnb and VRBO searches, avoiding oversaturated areas while identifying underserved pockets near attractions like Dollywood, Ober Mountain, or scenic drives. Utilize local resources including Sevier County tourism data, Great Smoky Mountains National Park visitor statistics, and Tennessee STR regulation updates, while partnering with local property managers familiar with the market's unique challenges like seasonal road access and mountain property maintenance requirements.

To obtain an Airbnb/STR permit in the Great Smoky Mountains area of Tennessee, you must first apply through the appropriate county office since the Great Smoky Mountains region spans multiple counties including Sevier, Blount, and Cocke counties, with Sevier County (including Gatlinburg and Pigeon Forge) being the most common location for STRs. Contact the Sevier County Planning Department or the specific city's planning office where your property is located to submit your application, which typically requires a completed STR permit application form, property deed or lease agreement, site plan showing parking and property boundaries, proof of liability insurance (minimum $1 million), septic system inspection certificate if applicable, and fire safety inspection certificate. The application fee ranges from $150-$300 depending on the jurisdiction, with annual renewal fees of $75-$150. The approval timeline is typically 30-60 days after submission of complete documentation. Specific Great Smoky Mountains requirements include compliance with the area's tourism overlay districts, adherence to parking requirements (usually 2 spaces per unit), occupancy limits based on septic capacity (typically 2 people per bedroom plus 2 additional), noise ordinance compliance due to the tourist-heavy area, and potential restrictions on the total number of STR permits issued in certain zones to preserve neighborhood character, with some areas requiring a minimum distance between STR properties.

Short-term rentals (STRs) are legal in the Great Smoky Mountains area of Tennessee, but they operate under a complex regulatory framework that varies by jurisdiction. In Sevier County, which encompasses popular destinations like Gatlinburg and Pigeon Forge near the national park, STRs are permitted but must comply with zoning regulations, obtain proper permits, and meet safety requirements including fire inspections and occupancy limits. The City of Gatlinburg requires STR operators to obtain business licenses and pay occupancy taxes, while Pigeon Forge has similar requirements with additional parking and noise restrictions. However, STRs are prohibited within Great Smoky Mountains National Park boundaries themselves, as federal land does not permit private short-term rental operations. Recent changes in 2022-2023 have seen increased enforcement of existing regulations, with some municipalities implementing stricter noise ordinances and parking requirements due to overtourism concerns. Properties in residential zones may face additional restrictions, and some homeowners associations have implemented their own STR prohibitions, making it essential for operators to verify compliance with federal, state, local, and HOA regulations before establishing short-term rental operations in the Great Smoky Mountains region.

The best Airbnb investment areas in the Great Smoky Mountains region of Tennessee include Gatlinburg, particularly the downtown Arts and Crafts Loop area and Ski Mountain Road corridor, which attract millions of visitors annually due to proximity to Great Smoky Mountains National Park, Dollywood theme park, and year-round attractions like Anakeesta and SkyBridge. Pigeon Forge offers excellent returns along the Parkway strip and Wears Valley Road, benefiting from Dollywood's 3 million annual visitors, dinner theaters, and seasonal events like Winterfest. Sevierville's Dolly Parton Parkway and Wears Valley areas provide strong rental demand from tourists visiting Tanger Outlets, zip-lining attractions, and serving as a gateway to the national park. The Smoky Mountain foothills areas of Townsend and Cosby offer premium cabin rental opportunities for visitors seeking secluded mountain experiences while remaining within 30 minutes of major attractions. These locations benefit from Tennessee's tourism industry generating over $23 billion annually, with Sevier County alone hosting approximately 12 million visitors per year, creating consistent demand for short-term rentals across all seasons due to spring wildflowers, summer hiking, fall foliage, and winter mountain activities.

In the Great Smoky Mountains region of Tennessee, Airbnb hosts are subject to multiple lodging taxes including the state sales tax of 7%, Tennessee's statewide lodging tax of 3%, and various local occupancy taxes that range from 3% to 5% depending on the specific county and municipality, with Sevier County (which includes Gatlinburg and Pigeon Forge) imposing a 5% local occupancy tax, bringing the total tax burden to approximately 15-16% on short-term rental accommodations. These taxes are collected either directly by Airbnb through their automatic tax collection service for participating jurisdictions or must be collected by hosts and remitted monthly to the Tennessee Department of Revenue for state taxes and to local tax authorities for county and city occupancy taxes, typically due by the 20th of the following month. Hosts must register for tax permits with both state and local authorities, maintain detailed records of all bookings and tax collections, and file regular returns even during periods of no activity. Exemptions are generally limited to stays exceeding 30 consecutive days which may qualify as long-term rentals rather than transient accommodations, and certain government or charitable organization bookings, though hosts should verify current exemption criteria as regulations frequently change and enforcement has increased significantly since 2018 when Tennessee began requiring marketplace facilitators like Airbnb to collect and remit taxes on behalf of hosts in participating jurisdictions.

The total cost to start an Airbnb in Great Smoky Mountains, Tennessee ranges from $420,000 to $480,000. Property purchase represents the largest expense at $350,000 to $400,000 for a median 3-bedroom cabin or mountain home suitable for short-term rentals in areas like Gatlinburg or Pigeon Forge. Furnishing costs typically run $25,000 to $35,000 for complete setup including beds, linens, kitchen appliances, outdoor furniture, and mountain-themed decor that appeals to tourists. Initial setup costs including professional photography, listing creation, welcome materials, and basic maintenance supplies total approximately $3,000 to $5,000. Permits and fees vary by municipality but generally include business licenses, occupancy permits, and registration fees totaling $1,500 to $3,000 annually. Insurance costs for short-term rental coverage average $2,500 to $4,000 per year. Utilities including electricity, water, internet, cable, and propane for mountain properties typically cost $300 to $500 monthly. First six months operating costs including utilities ($1,800 to $3,000), cleaning services ($2,400 to $3,600), maintenance and repairs ($2,000), marketing and platform fees ($1,500), and miscellaneous expenses ($1,000) total approximately $8,700 to $11,100.

Airbnb properties in the Great Smoky Mountains, Tennessee demonstrate strong profitability potential with average annual revenues ranging from $35,000-$85,000 for well-positioned cabins and chalets, while expenses typically run $18,000-$35,000 annually including mortgage, utilities, cleaning, maintenance, and property management fees, resulting in profit margins of 35-65% for successful properties. Prime locations near Gatlinburg and Pigeon Forge command premium rates of $150-$400 per night during peak seasons, with occupancy rates averaging 60-75% year-round due to consistent tourist demand from Great Smoky Mountains National Park visitors. Success factors include proximity to attractions like Dollywood, unique amenities such as hot tubs and mountain views, professional photography, dynamic pricing strategies, and exceptional guest service, with many investors reporting ROI of 8-15% annually. Properties within 10 miles of Gatlinburg consistently outperform more remote locations, and luxury cabins with 4+ bedrooms and distinctive features like game rooms or fire pits achieve the highest profitability, though initial investment costs range from $200,000-$600,000 depending on size and location.

Airbnb investments in the Great Smoky Mountains, Tennessee typically generate annual ROI of 12-18% with cash-on-cash returns ranging from 8-15% depending on property location and amenities. Properties within 10 miles of Gatlinburg and Pigeon Forge command premium rates of $150-300 per night with 65-75% occupancy rates during peak seasons, while cabins with hot tubs, game rooms, and mountain views can achieve $200-400 nightly rates. Initial investment recovery typically occurs within 6-8 years for well-positioned properties, with monthly gross revenues of $3,000-8,000 for 2-4 bedroom cabins after accounting for cleaning fees, property management (20-30%), insurance, and maintenance costs. The market benefits from year-round tourism driven by Dollywood, national park access, and seasonal attractions, with properties purchased in 2019-2021 showing particularly strong performance as vacation rental demand surged, though investors should expect 3-6 months to reach optimal occupancy rates and profitability after initial setup and marketing efforts.

STRSearch is a national platform that specializes in identifying profitable short-term rental properties across markets including the Great Smoky Mountains region of Tennessee. Local real estate agents like Smoky Mountain Realty and Gatlinburg SkyLift Realty have extensive experience helping investors find Airbnb properties in popular areas like Gatlinburg, Pigeon Forge, and Sevierville. National companies such as Awning, RedAwning, and Vacasa provide comprehensive services from property acquisition to management for short-term rental investors in the Smokies. Regional specialists like Tennessee Mountain Realty and Smoky Mountain Premier Properties focus specifically on vacation rental investments in the area, while services like AirDNA and Mashvisor offer market analysis and property evaluation tools for the Great Smoky Mountains market. Additional local agents including Century 21 Four Seasons Realty and RE/MAX Smoky Mountain Realty have dedicated vacation rental investment divisions, and companies like HostGPO and RedAwning provide ongoing support for property management and optimization in this high-demand tourist destination that sees millions of visitors annually to Great Smoky Mountains National Park.