North Myrtle Beach STR
New to Real Estate · NY · Member since 2020 · 72 posts · 42 votes
North Myrtle Beach STR
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Rental Property Investor · Northern Virginia · Member since 2022 · 127 posts · 123 votes
1yI bought my one and only short-term rental (STR) in North Myrtle Beach in February 2024. It is a 4-bedroom single-family house situated just .33 miles from the ocean. While the $600 per month insurance bill is hefty, I remind myself that being closer to the ocean would have meant even higher costs.
One of the key lessons I've learned is the importance of timing. I took too long to get my property rent-ready, which led to a significant loss of potential revenue. In its first year, the rental only earned enough to cover half the mortgage. This year, I am optimistic it will cover the entire mortgage. By year three, I aim to cover all operating costs and, by year four, to generate positive cash flow.
Experienced investors say it’s crucial to persevere through the initial challenges while gradually building credibility through positive reviews, and I believe them. Additionally, I'm banking on a future opportunity to refinance.
After less than a year, here are a few tips from what I’ve learned:
- *Hire a local STR expert real estate agent to guide your investment location.
- *Buy (in) the right property/building to ensure compliance.
- *Look for properties where you can gain immediate equity by buying at a low price.
- *Prepare for high insurance costs by running a few properties by your STR insurance company before making a purchase.
- *Have sufficient capital to 1) invest in exceptional design and amenities to stand out in a saturated market and 2) endure the low season.
- *Self-manage your property for at least one year to maximize profits and ensure quality guest experiences.
Hopefully, this helps in some way.
9 Replies
- Investor · FL · Member since 2016 · 332 posts · 388 votes1y
While I have none in this market I have been on one realtors monthly newsletter with market analysis for over 8 years. This is more about inventory and not STR returns. Here is his latest analysis...I hope it helps:
For the second month in a row, the number of active listings declined sharply. As of December 15, there were 921 active listings, compared with 954 last month. The number of active condo listings off the beach decreased also, from 1838 to 1781.
Overall, the market continued to slow with the fewest closed sales since 2016. The number of closed sales in 2024 decreased by almost 22% compared to 2023 (1272 vs. 1622). This followed a 25% decrease from 2022 to 2023, which followed a 23% decrease from 2021 to 2022.
However, year-over-year average and median prices increased for the 5th year in a row. The average increased from $326,908 in 2023 to $352,257 in 2024. The median price increased from from $258,000 to $285,000. This is the silver lining to our current market. Even though buffeted by high interest rates and spiking insurance premiums, overall prices are still rising. Since 2019, the median closed sales price for an oceanfront condo in our area has increased from $157,000 to $285,000. That’s 85% median appreciation!
Other insights to be gleaned from the stats: Cash purchases dominate more than ever, representing over 62% of purchases. In category after category, larger condos and higher price ranges are selling better than smaller condos and lower price ranges.
The average closed sales price increased 2.9% but the big changes were in the numbers of listings and sales. New listings decreased by 40%, from 193 in November to 115 in December. I suspect this was just an anomaly but it could be a sign of things to come. The number of closed sales increased a whopping 67.7%, from 65 to 109. This was probably a result of the busy November for new contracts. Keep in mind these still aren’t huge numbers by historical standards.
Single-family home stats for November. There were once again more closed sales for new construction than for resales, 449 vx. 381. There were once again more new resale listings than new construction listings, 387 vs. 343. So, resales are being listed faster but new construction homes are selling faster. In fact, for detached houses, there were more new construction sales in 2024 than resales, 5445 vs. 5267.
Condos --Big changes in the numbers of listings and sales. New listings decreased by 40%, from 193 in November to 115 in December. This could be an anomaly or a sign of things to come. The number of closed sales increased a whopping 67.7%, from 65 to 109. This was probably a result of the busy November for new contracts (See chart in newsletter).
For the second month in a row, the number of active listings declined sharply. As of December 15, there were 921 active listings, compared with 954 last month. The number of active condo listings off the beach decreased also, from 1838 to 1781. (See chart in newsletter).The number of closed sales in 2024 decreased by almost 22% compared to 2023 (1272 vs. 1622). This followed a 25% decrease from 2022 to 2023, which followed a 23% decrease from 2021 to 2022. First, this shows how outstanding 2022 and, particularly, 2021 were. I called them Unicorn years in other newsletters. Second, this will hopefully not be the start of another rut for oceanfront condo sales like we had from 2010 to 2016. During that 7-year time period, the median number of sales per year was 1259, about the same as in 2024. By contrast, the median number of sales per year for the 7-year time period from 2017 to 2023 was 1687, 34% higher. As previously mentioned, the average sales prices and median sale prices continued to climb for the 5th year in a row. The average increased from $326,908 in 2023 to $352,257 in 2024. The median price increased from from $258,000 to $285,000. This is the silver lining to our current market. Even though buffeted by high interest rates and spiking insurance premiums, overall prices are still rising. Since 2019, the median closed sales price for an oceanfront condo in our area has increased from $157,000 to $285,000. That’s 85% median appreciation!
With the number of sales down 22% from the previous year, there were decreases in most price categories. The only price ranges with increases in sales volume were from $400K to $450,000 and $650K and up. I think these high-end sales contributed to the high averages and medians for prices. Once again, this matches my personal experience that the larger, more expensive properties continue to sell better than smaller properties. Compared to 2023, selling prices were flat for efficiencies, decreased slightly for one-bedrooms, and increased slightly for 2 bedroom, 3 bedroom, and 4 bedroom condos. This is the same pattern again with the larger condos selling better.
- 1yJohn UnderwoodPro MemberInvestor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
I love the Myrtle Beach area.
Condos are a dime a dozen so there is stiff competition which pushes prices down.
HOAs have their own problems which I always avoid.
I would try and buy a beachfront house or 1st row house
- New to Real Estate · NY · Member since 2020 · 72 posts · 42 votes1y
@John Underwood Thanks for your input, I assume a beachfront house is going over 1 million in that area right?
- 1yJohn UnderwoodPro MemberInvestor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
Quote from @Matt Schreiber:
@John Underwood Thanks for your input, I assume a beachfront house is going over 1 million in that area right?
Have you ever seen the show beachfront bargain hunt? They find deals on oceanfront houses all over the country.
I'd even look for a fixer upper to get a great deal. It's all the about the location and the view. You can change a house.
- Rental Property Investor · Northern Virginia · Member since 2022 · 127 posts · 123 votes1y
I bought my one and only short-term rental (STR) in North Myrtle Beach in February 2024. It is a 4-bedroom single-family house situated just .33 miles from the ocean. While the $600 per month insurance bill is hefty, I remind myself that being closer to the ocean would have meant even higher costs.
One of the key lessons I've learned is the importance of timing. I took too long to get my property rent-ready, which led to a significant loss of potential revenue. In its first year, the rental only earned enough to cover half the mortgage. This year, I am optimistic it will cover the entire mortgage. By year three, I aim to cover all operating costs and, by year four, to generate positive cash flow.
Experienced investors say it’s crucial to persevere through the initial challenges while gradually building credibility through positive reviews, and I believe them. Additionally, I'm banking on a future opportunity to refinance.
After less than a year, here are a few tips from what I’ve learned:
- *Hire a local STR expert real estate agent to guide your investment location.
- *Buy (in) the right property/building to ensure compliance.
- *Look for properties where you can gain immediate equity by buying at a low price.
- *Prepare for high insurance costs by running a few properties by your STR insurance company before making a purchase.
- *Have sufficient capital to 1) invest in exceptional design and amenities to stand out in a saturated market and 2) endure the low season.
- *Self-manage your property for at least one year to maximize profits and ensure quality guest experiences.
Hopefully, this helps in some way.
- 1yMyrtle Mike ThompsonBusiness MemberRealtor · Myrtle Beach, SC · Member since 2016 · 352 posts · 204 votes
@Matt Schreiber I broker STR deals up and down the coast here in Myrtle Beach and North Myrtle. @Shannon Strickland offered some great advice. Aligning yourself with a buyers agent who understands the STR market is absolutely critical. There are a lot more condos for sale now compared to the past few years, but we still haven't reached pre-Covid inventory levels. Listings also tend to tick up in the offseason as investor owners look to test the market. If they can get what they want, they'll sell - often trading up for a larger property by way of 1031 exchange. If not, many will withdraw their listings by spring, content to hold for another vacation season ($$$). When it comes to the STR game, differentiation is critical, and that can be challenging with a 550 square foot oceanfront condo. As others have alluded to, buying larger units or a house near the beach is a better play. You'll have a bigger footprint to add cool design elements and offer more amenities to guests. You don't have to spend a fortune and buy a house directly on the beach to do well, but your starting price point for a viable option in this market is around $350-$450k for a solid 2-3 bedroom oceanfront condo or around $500k for a 3-4 bedroom house within walking distance of the beach. The bigger you go, the less competition you'll have and the greater your chance at some serious cash flow. Consider partnering up with someone for your first deal. And if you have any questions I can help with, feel free to reach out!
Myrtle Mike Real Estate581 Reviews - Rental Property Investor · south carolina and michigan · Member since 2023 · 348 posts · 226 votes1y
Quote from @Matt Schreiber:
I've been noticing a lot of inventory for beachfront condos in Myrtle Beach and North Myrtle Beach. It also seems like a lot of the condos sit on the market for 3 months or more. Just curious if anyone is doing STR's in that market and what kind of results they're seeing.
We own two beach houses in ocean lakes and they average around 50-70k/ea depending on economy etc.
you couldnt pay me to buy a condo in nmb or mb right now
- New to Real Estate · NY · Member since 2020 · 72 posts · 42 votes1y
@Nathan M kiefer Interesting, I've looked into Ocean Lakes. Just curious how come you're so down on the oceanfront condos?
- Rental Property Investor · south carolina and michigan · Member since 2023 · 348 posts · 226 votes1y
Condos-inventory or no inventory, they are just not a deal right now and outside of ocean front theyre hard to differentiate yourself to clientele. I also don't like the sardine effect where your just packed in a building, ocean lakes is tight with homes but still feels private at the house(s), golf cart community and 2 min from the ocean on a golf cart where ours are.
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