All Forum Posts by: Brandon Dawson

You're 100% correct about cash flow being easily manipulated with down money and about the STR regs. I think Mt. Pleasant and downtown Charleston are the most desirable and will continue to appreciate (even if through forced inflation), but, as you know, it's expensive in those areas. Again, I think Park Circle and the "neck" area downtown have a lot of upside and there are some opportunity zones investment opportunities which are great for buy and hold strategies.

Are you looking for long term rentals or STRs? Appreciation or cash flow?

I still think Park Circle checks both boxes although, like everywhere around here, the prices have increased dramatically. Additionally, downtown in the NoMo and Upper East Side areas there is money to be made as those areas continue to see new developments and infrastructure. Anything along the Charleston Greenway would be a good bet to appreciate once that project gets underway. Johns and James both have lower barriers to entry so maybe you’ll be able to long term and cash flow. It’s near impossible to cash flow in Mt P. 

Best,

BD

Great write up about Charleston. The only thing I'd have to disagree with is that people vacation to Goose Creek, SC. That just is not the case. I would also add that James Island and Johns Island are both exploding with growth and opportunity. 

Thanks! Is that written in the new ordinance? 

@Peter Stanley thanks Peter - I actually mentioned that in an earlier comment. I'm really hoping they have language in it that will address grandfathering existing STR permits year over year and having them convey to any purchaser if they want it.

There is a lot of good that can be done by limiting the amount but as written it’s fraught with issues.

@Reid Matthews in Mt. P you have to reapply for business license and STR permit annually. Right now it's July 1 but I believe they are looking at moving that (not 100% sure though). You also have to pay monthly taxes (3%) to Charleston county and the town of Mt p. AirBnB does not remit all of the necessary taxes.

Just a heads up, I heard there were only seven short term rental permits left in Mount Pleasant. The town of Mount Pleasant just had a reading of a new ordinance limiting the short term rentals to 350 licenses. There is no guarantee that you will be able to get a short term rental license if you are buying now.

@Deidre Carpenter yes, but you have to get a license and adhere to any HOA rules. I use Chris MacEachern at the Beach Company for finding my investment properties.

@Rene M. Check out the town's website for more info. You need a business license (based on gross sales % - cheap) and then you can apply for a STR Permit ($250). The process wasn't difficult but it was a bit tedious. It can be done online though. You have to renew the business license and STR Permit annually.

I have been debating buying another one and would probably target the little townhouses off of Center Street in the Old Village/Old Mt. Pleasant. You can get in there for around $300k for a decent place (do your DD on STR but I've seen several of them on AirBnB).

We try to cater to higher end users as it cuts down on abuse and you can get a higher ADR (average daily rent) but you have to find what works for you. I try to stay around 70-75% occupied but others want shoot for much higher at a lower rate though. I'd suggest you check out dynamic pricing (I use Beyond Pricing but there are others).

Below are some helpful links to the TOMP STR and an STR calculator.

https://www.tompsc.com/1154/Short-Term-Rentals

https://jerrybarker.com/calculator/

Lastly, I don't think you have to exclude all HOA communities but I'd certainly be wary of them. Most have adopted rules addressing STRs by now. The rule of thumb is you want the numbers to work as a LTR to be safe even if you are going to STR it. Depends on your risk tolerance though.

Hey Rene,

I operate a STR in Mt. Pleasant and found the licensing/permitting to be easy to navigate. You are correct that it is limited to 1% of the homes in Mt. Pleasant which is good and bad in that it limits potential competition, if you get a license. The lure of Charleston is the beaches and downtown so you typically want to be close to both of those to get a good ROI in my opinion.

I would suggest you get on AirBnb or check out AirDNA to see what places are renting for right now and the occupancy rates. Make sure you have reserves for another major shutdown in case we see a repeat of March - May where all of our bookings dropped off. 

North Charleston is more up and coming and probably not a great AirBnB area outside of maybe Park Circle. Downtown you are limited to the STR overlay district but that's way out of your budget and not sure it would provide a ROI even if it was in your budget.

Can you build an ADU on your property to rent out?

Also, if you want a local realtor who grew up here check out the Beach Company - Chris MacEachern, Will Freeman, Sam Little, Russell Robinson, etc. I've known all of them for decades growing up here in Charleston. They are all well versed in STR and investment property. I've personally used Chris a few times for investment properties.

Best,

Brandon