We have been helping Buyers from the most novice level to full blown investment firms/groups with log cabins and short term rental cabins in the Smoky Mountain area of Gatlinburg, Pigeon Forge, and Sevierville for over 15 years. This is what we do day in, and day out. I would like to say that we chose this niche' but honestly, I think it chose us. Short of a few residential homes and tracts of land, we exclusively handle log cabins. We have become experts in this niche' and love helping every level of Buyer looking to add a log cabin STR to their portfolio or just acquire a vacation cabin in the mountains.  

Why Look At New Construction Log Cabins?

The market has been extremely aggressive over the last few years. Especially the last 12 months. The inventory is still very low and the demand is still very high. The norm has become multiple offers well over asking price, taking cabins in "as-is" condition, appraisal waivers or gap coverage, escalations clauses, etc. This has created an environment that can make it very difficult to get something under contract. The reality is that it can take up to 8-10 offers on different properties before you get something under contract. Depending on how long that takes, you could see values increase $20,000 - $100,000 from the time you started until the time you actually get something under contract. This has been one of the main driving forces for looking at the possibilities of new construction and what that entails. 

How Does New Construction For Log Cabins Work?

One thing to note right off the bat is that 95% of all the new construction listings that you will see on the market have not started construction yet. The reason for this is because they require you to obtain a construction loan. Many of these builders are not building using their own money (Spec builds) because of what happened to the market in 2008. Almost all of them were caught with millions of dollars in inventory or projects underway and they lost it all. There are still a few instances where you can buy a new construction log cabin that has recently been completed but it is pretty rare and not the norm.

There are a number of banks locally that will do construction loans on log cabins. The terms are going to require more money down and almost always there will be two closings that take place. One on the land and one again once the cabin is completed. The typical down payment is going to be 20-25%. Some may require 30% and there may still be one or two that will do 15%, but 20-25% is the norm. You will be making interest only payments of the money that is used during the construction and that payment will increase as the project progresses. In many cases you will still end up with a fully completed and furnished cabin that should be ready to rent the day after closing. Some will not furnish them and will expect you to do that after closing. This is the less attractive scenario for Buyers. 

Are These New Log Cabin Builds Custom?

Many of the new construction log cabins that you see listed in the MLS will not offer much in the way of customization. The floor plans are almost always set in stone along with the exterior and interior look and materials used. The limited options that you will have to choose from will pertain to paint color, possible some flooring selections, maybe some granite selections, and then you should have a decent amount of say in the furnishing selections providing it stays within the budget allocated for it. It is basically a spec build that is being done on your dime.

To truly get a custom build, you would be searching and purchasing land to build on and then enlisting the services of a builder to build a custom product. This is without a doubt the best way to get exactly what you want, BUT it is a guarantee that it will cost you more and you will go over budget. And almost always the furnishings and furniture will not be included. You will have to buy all of that outside of the project cost on your own.