Buying a Short-Term Rental in Myrtle Beach

The Conversion-Ban Ordinance: A City Locking In Tourism-Rental Use

On December 10, 2024, Myrtle Beach City Council gave second-reading approval to an ordinance creating a "short-term rental conversion overlay zone" covering essentially the entire primary tourism corridor -- everywhere east of Kings Highway from 29th Avenue South to 82nd Avenue North. Inside that zone, owners are banned from converting short-term rental units into long-term rentals: a lease exceeding 89 days is treated as long-term use, and once a unit converts, it cannot convert back to short-term rental status. Assistant City Manager Brian Tucker explained the rationale directly: "the planning commission recognizes...that everything east of Kings Highway is our main tourism component."

This is the functional inverse of the short-term-rental story you'll find in nearly every other coastal market: instead of residents fighting to keep vacation rentals out of their neighborhoods, Myrtle Beach's city government is using its zoning power to stop owners from opting a tourism-zone property out of short-term rental use and into long-term housing. The ordinance followed an April 2024 moratorium, during which the city commissioned an urban-planning impact study. That study found that converting just 1,000 rental rooms to long-term use would cost roughly $7.6 million in total lost revenue across all levels of government -- about $2.5 million to the city, $1.2 million to the county, and $3.9 million to the state -- through lost accommodations tax, prepared food-and-beverage tax, and business-license-fee revenue. In plain terms: the tourism-tax base this ordinance protects is now load-bearing for the municipal budget, and the city used its regulatory power to defend it rather than to restrict it.

For a buyer, the practical implication cuts both ways depending on what you're trying to do. If you're buying specifically to run a short-term rental east of Kings Highway, the ordinance works in your favor -- it removes the risk that a future council could let the surrounding tourism district quietly convert to long-term housing around you. But if you're eyeing a property in that zone with an eventual plan to convert it into a long-term rental or a personal residence you'd rent out on a lease basis, confirm directly with the City of Myrtle Beach Planning Department whether your specific parcel sits inside the overlay zone and what that means for your exit options, before you assume you can simply change use later.

The Tax Stack: Five or Six Separate Levies, and Our Own Arithmetic on the Combined Rate

A Myrtle Beach short-term-rental night is taxed through more separate levies than most markets we cover. South Carolina imposes a 2% state accommodations tax, and municipalities may add up to an additional 3% local-option accommodations tax on top of that; of what's collected, the first $25,000 goes to local general funds, with 30% of the remainder earmarked specifically for tourism advertising and promotion. A narrow exemption exists for owner-occupied properties of six or fewer bedrooms that aren't rented through a rental agency or an online travel platform like Airbnb or Vrbo.

Layered on top of the state and local-option accommodations tax, the City of Myrtle Beach separately imposes its own 0.5% Local Accommodations Tax (effective July 1, 2021) plus a 1% City Hospitality Fee, which covers accommodations, food and beverage, and paid admissions. Horry County adds its own 1.5% County Hospitality Fee on top of that, remitted to the city net of a 1% administrative charge. All of that sits above the area's 9% in-city sales tax (6% state + 2% county special-district surtax + a 1% municipal levy the City of Myrtle Beach and North Myrtle Beach both add on top of the county baseline) -- meaning a room-night here runs through at least five or six distinct, separately administered levies before you even get to income tax on the rental income itself.

We want to be explicit about what our own combined-rate estimate actually is: summing those layers suggests a combined nominal rate somewhere in the 15-17% range. That figure is this page's own arithmetic, not a single number stated by any primary source we found -- some of these fees may apply to overlapping or different bases, and platforms like Airbnb and Vrbo often collect and remit some portion of these taxes automatically, while direct bookings generally leave collection and remittance on the owner. Confirm the true all-in effective rate directly with the South Carolina Department of Revenue or the Horry County Treasurer before building it into a pro forma.

The Business License: Every Rental Property Needs One, Short-Term or Long

Separate from the tax stack, the City of Myrtle Beach requires a business license for every rental property in the city -- short-term or long-term, residential or commercial -- under an ordinance adopted June 10, 2014 and effective June 1, 2015. The license fee is calculated on gross receipts, not a flat rate, so a busier rental year means a larger fee the following cycle.

The license year runs June 1 through May 31. The city mails renewal notices by April 1, payment is due June 1, and a license becomes delinquent on July 1 if unpaid, triggering a 5%-per-month late penalty that caps out at 30% of the fee owed. Applications are handled in person at the City Services Building, 921 Oak Street. One distinction worth knowing before you assume a property qualifies as a short-term rental at all: stays of 90 or more consecutive days do not count as short-term for these purposes, which matters if your business plan involves a mix of nightly bookings and longer seasonal stays.

HOA and Condo-Tower Rules: A Second Rulebook the City Can't Override

Much of Myrtle Beach's oceanfront inventory is organized under South Carolina's Horizontal Property Regime (HPR) -- the state's own specific legal term, dating to its 1960s Horizontal Property Act, for what most other states simply call condominium ownership. An HPR is defined by its ownership structure, governed by a master deed, bylaws, and rules and regulations, not by its architecture -- so everything from a 20-story oceanfront tower to a detached cottage can legally be organized as an HPR. That master deed and those bylaws are where an individual owner's rental rights actually live, separate from anything the city permits or restricts.

In practice, that means a property can be fully legal under the city's business-license and accommodations-tax rules and still be restricted -- or required to rent only through the building's own in-house rental program, or capped on how many owners can self-manage listings on Airbnb or Vrbo -- by its own HOA or condo association. We did not find a specific, named example of an individual Myrtle Beach tower's own short-term-rental restriction or in-house-rental-program requirement during this research; that's a real, disclosed gap, not a claim that such restrictions don't exist here. Given how common they are in other Southeast oceanfront condo markets, treat it as likely rather than unlikely, and get the specific building's master deed, bylaws, and any rules-and-regulations amendments directly from the HOA or condo association before you assume a unit can be rented the way a listing photo or a seller's pitch implies.

The oceanfront condo-tower market also comes with a cost layer worth underwriting up front: HOA and regime fees at Myrtle Beach oceanfront buildings have risen roughly 15-30% over the past two years, with monthly fees now ranging from under $400 to over $1,200 depending on building size and amenities, and insurance costs specifically have risen sharply -- wind/hail premiums up 40-80%, and building master insurance policies that cost $300,000-$400,000 a few years ago now running $600,000-$700,000 or more annually, with individual unit-owner policies costing 30-50% more than three years prior. Confirm current HOA dues, insurance costs, and any rental-program requirements directly with the specific building's HOA before closing.

What This Means Before You Buy -- and Where to Get a Real Answer

Here's what's sourced and what isn't. Sourced: the December 10, 2024 conversion-ban ordinance and its Kings Highway/29th Avenue South-to-82nd Avenue North overlay zone, Assistant City Manager Brian Tucker's stated rationale, and the city's own commissioned impact study finding a hypothetical $7.6 million total revenue loss from converting 1,000 rooms ($2.5 million city, $1.2 million county, $3.9 million state); the state 2% accommodations tax plus up to 3% local-option accommodations tax structure and its owner-occupied exemption; the city's own additional 0.5% Local Accommodations Tax (effective July 1, 2021) and 1% City Hospitality Fee; Horry County's 1.5% County Hospitality Fee; the 9% in-city sales tax; the city's business-license ordinance (adopted June 10, 2014, effective June 1, 2015), its gross-receipts fee basis, its June 1-May 31 license year, its April 1 renewal-notice mailing and July 1 delinquency date, its 5%-per-month/30%-cap late penalty, and the 921 Oak Street application address; the 90-day-plus long-term-stay exemption; South Carolina's Horizontal Property Regime legal structure for condo ownership; and the documented rise in oceanfront HOA fees and insurance costs.

Not sourced, and not something we'll invent: a single combined tax-rate figure for short-term rentals here -- the 15-17% range above is our own arithmetic, not a number any primary source stated directly, so confirm the true effective rate with the South Carolina Department of Revenue or the Horry County Treasurer. Also unresolved: a specific, named Myrtle Beach building's own short-term-rental restriction or in-house-rental-program requirement -- general South Carolina HPR/condo law is confirmed, but no single building's own rule was independently sourced this pass. Short-term rental regulations, tax rates, and HOA rules all change, and this page can go stale between updates. Before writing an offer with short-term-rental income in the underwriting, confirm the specific parcel's status relative to the conversion-overlay zone and current business-license requirements with the City of Myrtle Beach, confirm the current combined tax rate with the South Carolina Department of Revenue and the Horry County Treasurer, and have a South Carolina real estate attorney review the property's specific HOA or condo association master deed and bylaws before you buy.