Coronavirus Impact on Beach Rentals in North Carolina

[Rich McElaney]

I just found a Coronavirus discussion on the main discussion board but wanted to drill down more specifically to get input from current STR property owners in the North Carolina Beach areas.

I have a pending deal for a 2/2 STR in Carolina Beach that has been rented short term for 5+ years showing decent net income history. There are six dates already booked for 2020 by the current property owner but those guests will have to be notified of new ownership and bookings would need to be transferred or re-booked soon after closing on the property. ( I plan on keeping the rates exactly as they are for those bookings.)

My calculations show that I would need 52 bookings to break even, which would be an approximate 30% drop in activity using last year's booking numbers. 

My questions:

1. To date, what are current STR beach property owners seeing in terms of cancellation activity?

2. Are NC Beach area STR property buyers (whether new or experienced) buying in the face of coronavirus' unpredictability?

[Melinda O Miller]

We have five vacation STRs in Carolina Beach and Kure Beach.  We use vrbo and AirBNB.  Our main rental property-oceanfront, pool 5BR/4.5BA has been booked from April 24 - August 23 since Jan. April 8 - 15 has cancelled and we refunded 100%.  April 3-5 cancelled due to baseball tournament cancellation; we refunded 100%.  We had a family here from Minnesota (drove here) March 15 - 20.  They have extended their stay for an extra week--why not practice social distancing at a beach house?!?  We have also had a request to move a May 20 - 27 stay to the fall.  We informed all of our current reservations that we were relaxing our standard cancellation policy-meaning that they have longer to decide to cancel and hoping that the craziness will blow over sooner rather than later.  So far, no more cancellations.

Three of our other properties are smaller one- or two- bedroom units that are rented month to month during the off-season and are occupied until May.  They have a smattering of reservations throughout the summer but usually are not booked very much in advance.  

The beaches are closed for now but we are hopeful that a little pain now will nip this thing and we can have a robust summer and fall season.  And hopefully no hurricanes this year!  This is our third season with rental properties on Pleasure Island and each one has brought challenges.  Vacation STRs definitely require nerves of steel as so much is unknown and out of your control.

Melinda O. Miller

Our Places in the Sun, Inc.