Oceanfront STR in North Myrtle Beach, SC!

[German Hall]

Investment Info:

Condo buy & hold investment in N Myrtle Bch.

Purchase price: $225,000
Cash invested: $30,000

This is a 1bd/1ba oceanfront condo with a private balcony located on the 14th floor of Beach Cove resort. Our unit contains 2 queen beds in the bedroom and 1 queen-sized sleeper sofa in the living room, allowing us to accommodate 6 people. We will be undergoing renovations in October of 2022 to update the bathroom and kitchenette area with new cabinets and countertops. The bathroom will also have a new vanity and toilet once completed.

What made you interested in investing in this type of deal?

North Myrtle Beach and Myrtle Beach have a lot to offer to travelers and occupancy is high in these areas. We will be able to pay off our mortgage with the money from our guests, and have some left over to continue to upgrade the property without dipping into our own bank.

How did you find this deal and how did you negotiate it?

We drove to the area to meet with our Realtor and found this property via MLS. We saw it and put an offer immediately.

How did you finance this deal?

Since this was a condotel, we had to put down 25% using a conventional loan.

How did you add value to the deal?

Quick value add will be done in October of 2022 when we update the cabinets and countertops in the kitchenette and bathroom.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Yes! Please direct message me if you'd like the name of the agent that helped us. She was very responsive and knowledgable about the area!

[German Hall]

Quote from @Eric Hobbs:

@German Hall

Congratulations! What is your projected income after expenses and how did you come up with those numbers? What is monthly HOA?

Thank you, Eric! I've used AirDNA.co to determine the estimated annual revenue for 1 bed/1bath that sleeps 6. They projected about $46,000 based on like properties in that area with an occupancy rate of 82% and Average Daily Rate of $152. We currently just went live with our property and offering bookings starting 7/25/22, since right now we have to honor previous owners guests that were booked. The unit has been booked every weekend in June and most of July, and we have 10 days booked of August already. 

I believe our Net-Operating income will be about 20-23k once we are established for an actual full year. HOA is $592/month and includes internet (50mbps so no need to purchase my own), basic cable, electricity, water, sewer, trash, and pest control. So with our mortgage and hoa fees it comes to about $2,000 month and no additional utilities need to be expended. I am not sure yet about how much annual cost it will be for inventory since this is our first go at this and its already half-way through the year. For the remainder of 2022 I will be happy just to have my mortgage and inventory expenses paid for by the guests.