Should I Buy a Short Term or Long Term Rental in Myrtle Beach?
Buying a rental property in Myrtle Beach is an obvious choice, with a diverse real estate market and steady demand. Both long term rentals and short term vacation rentals can be a lucrative way to go, so how do you choose which type of rental to buy? This might help you navigate the decision and guide your house hunting process.
Understanding the Rental Market in Myrtle Beach
The type of rental you choose will be affected by the rental market in Myrtle Beach. This is a community that is both a great place to live and a popular vacation spot. Myrtle Beach is a major tourist destination, drawing millions of visitors each year. The city's attractions, including its beautiful beaches, golf courses, and entertainment options, contribute to its popularity among vacationers. Myrtle Beach experiences seasonal fluctuations in tourism, with peak periods during the summer months. The influx of visitors during these times creates opportunities for short-term vacation rentals to thrive.
This means that those interested in owning a short term vacation rental need to be prepared for the potential of slow seasons. While many people still find that they are profitable over the year thanks to the busiest seasons, it's important to not base your budget on the optimal conditions you can experience during the summer months.
On the other hand, there is a strong local economy and a growing community of full time residents in Myrtle Beach. The local economy is influenced by tourism, with hospitality and related industries playing a significant role. Economic stability and growth contribute to the overall health of the Myrtle Beach real estate market. While a long term rental won't command the same rental rates as a vacation rental will, there is a steady demand for long term rentals that can provide a predictable and stable income.
The property management of the two types of rentals will be quite different. Vacation rentals require far more attention and usually mean someone needs to be on call at all times. In some cases, you can purchase a condo in one of the oceanfront resorts in Myrtle Beach, where on site resort staff can act as property management. However, in many cases you will need the ongoing support of maintenance, cleaning, and hospitality personnel to help with property management on a weekly or more frequent basis.
A long term rental, on the other hand, has the potential to be a much more passive source of income. Investing more time upfront with the lease and being available throughout will likely come out to far less work than the short term rental, especially when you factor in housekeeping and lawn maintenance that you can hand off to the tenants. Keep in mind that in some cases, long term tenants will translate to deferred maintenance issues of which you are not away, which create other problems in the long run.
It's hard to simply answer which is more profitable because of the multiple factors to consider. Short term rentals during peak season can certainly command a higher rental rate, but these prices almost always need to fluctuate according to the seasonal demand. Overall, there is usually potential for greater income from a short term rental, but it also requires far more work and attention on an ongoing basis.
Long term rentals have a more stable and predictable income, and require far less hands on attention. Because of this, many buyers find that they can be less profitable but still worthwhile. In addition to the rental income, there is still equity being built and the cost of monthly payments will be offset or completely covered by the rental payments to make it profitable in a lower maintenance format.
Deciding between a short-term vacation rental or a rental for long-term tenants in Myrtle Beach is a nuanced process that hinges on various factors, including financial goals, lifestyle preferences, and the local rental market dynamics. Both options present unique advantages and challenges, and the ideal choice depends on your investment objectives and risk tolerance. Ready to find your rental property for sale in Myrtle Beach? Contact us any time.