Case Study: Short-Term Rental Performance at Holiday Sands North (Myrtle Beach, SC)

Introduction & Property Overview

Holiday Sands North “On the Boardwalk” is a family-operated oceanfront resort in the heart of Myrtle Beach, SC. It consists of two adjacent towers (North and South) offering a mix of studio/efficiency units, 1-bedroom suites, and 2-bedroom condos, with both direct oceanfront and ocean-view options. The resort provides an enjoyable, relaxed beach experience catering to families and couples, featuring indoor/outdoor pools, a lazy river, whirlpools, a kiddie pool, an oceanfront lawn, an on-site café, a fitness center, and even an arcade. The location is premium – right on the Myrtle Beach Boardwalk and Promenade – putting guests within walking distance of major attractions like the SkyWheel, Family Kingdom amusement park, and dozens of restaurants and shops downtown. (See image below: Holiday Sands North pool area and oceanfront tower.)

Holiday Sands North on the Myrtle Beach Boardwalk offers multiple pools and family-friendly amenities, attracting vacationers to its oceanfront condos.

From an investor’s perspective, Holiday Sands North presents an opportunity to own a short-term vacation rental condo in a high-demand coastal market. Although the resort has a long history as a traditional hotel, individual units are deeded condos that can be purchased and rented out by their owners. In this case study, we will examine current and historical (2023–2024) performance data for rentals at Holiday Sands North, including occupancy rates, rental income, unit resale values and appreciation trends. We’ll compare oceanfront vs. oceanview units across different sizes (studio, 1BR, 2BR) to see how view and unit type impact returns. We will also discuss renovation strategies and guest preferences (e.g. updated décor, amenities) and how they affect rental income. In addition, we’ll evaluate the Airbnb/VRBO route vs. on-site management, considering profitability and the practicalities of owner self-management. Key operational factors like the HOA structure, fees, and what they cover will be addressed, since these have a significant financial impact on net income. Finally, we’ll explore investment strategies relevant to these condos, such as using a 1031 exchange to defer capital gains taxes or purchasing through a self-directed IRA/401(k) to leverage retirement funds. Actual and estimated financial performance metrics – including Gross Rental Income (GRI), typical expenses (HOA dues, management fees, etc.), and Net Operating Income (NOI) – will be provided for various unit types to give a concrete picture of returns. The goal is to offer a comprehensive, data-driven case study for investors interested in short-term rental condos at Holiday Sands North.

Myrtle Beach Short-Term Rental Market Trends (2023–2024)

Like many vacation destinations, Myrtle Beach saw a surge in short-term rental demand in 2021–2022 followed by some normalization in 2023–2024. Overall, the market remains strong but is cooler than the peak pandemic-recovery years. According to AirDNA/Airbtics data, a typical Airbnb/VRBO listing in Myrtle Beach was booked ~226 nights in 2023 (about 62% occupancy) at an average daily rate of ~$121. This resulted in a median annual gross rental revenue of around $25,000 per property. However, year-over-year revenue in 2023 dipped by roughly 9.8%, indicating a slight decline from 2022’s highs. The summer of 2023, in particular, saw lower bookings compared to Summer 2022 – one analysis showed forward bookings for Myrtle Beach rentals were only ~39% of capacity vs. 58% at the same time the prior year. To compensate, many operators raised rates (Summer ’23 ADR was ~9% higher), but overall RevPAR still dropped about 25% year-on-year in peak season.

By 2024, the trend of slightly softer demand continued. An October 2024 report by the Myrtle Beach Area Chamber noted that short-term rental occupancy fell ~7% in Summer 2024 compared to Summer 2023, even as hotel occupancy actually rose 2% in that period. In practice, this meant guests tended to book shorter stays and last-minute trips, forcing hosts to cut rates at times to fill calendars. These patterns align with national vacation rental trends post-pandemic, as supply has increased and travelers have more options.

Despite the recent normalization, occupancy levels around 55–65% and steady tourist demand still make Myrtle Beach attractive for rental investors. The Grand Strand remains a top drive-to beach destination, and peak season (June–August) still generates the bulk of rental income (historically ~55% of annual revenue in just those summer months). The shoulder seasons and winter see lower rates and occupancy, but the presence of year-round draws (golf, off-season discounts, snowbird monthly rentals, holiday events, etc.) ensures some income even in colder months. Overall, an investor can expect that a well-marketed unit in Myrtle Beach can achieve gross rental income in the mid-five-figures annually – roughly $20K–$30K for a 1-bedroom and higher for larger units, as we’ll detail – assuming no extraordinary market disruptions.

Myrtle Beach Condo Values: On the property value side, the Myrtle Beach condo market has shown resilience and appreciation through 2023. Sales volumes did slow in 2022–2023 due to higher interest rates (fewer transactions), but prices continued to inch up. For example, one report noted condo sales were down ~20% year-over-year, yet median prices still rose about 6.2% to roughly $239,000 by early 2023. Through late 2024, prices have largely held these gains. In fact, the overall median home price in Myrtle Beach was around $271K (up ~7% YoY) as of mid-2024, with oceanfront condos specifically remaining in high demand. Holiday Sands North units have similarly appreciated in recent years. A 1-bedroom oceanfront unit in the newer south tower (built 2006) might have sold in the low $200s a couple years ago and is still in that range or higher today – for instance, a 1BR/1BA oceanfront condo at the sister property Holiday Sands South was listed at $220,000 in 2024. 2-bedroom units at Holiday Sands North, offering more space and sleeping capacity, would naturally command higher resale values (often in the mid-$200s to $300K range depending on view and updates). The key takeaway is that Myrtle Beach oceanfront condos have generally appreciated over the last 5 years, and while the rapid gains of 2021/22 have leveled off, values remain strong heading into 2025. Investors can expect both rental income and modest property appreciation to contribute to returns.

Unit Types and Views: Oceanfront vs. Oceanview Performance

Holiday Sands North offers a variety of unit types across its two towers, which differ slightly in layout and view. It’s important to compare oceanfront units vs. oceanview (or “boulevard view”) units as well as different bedroom counts, since these factors influence both rental rates and occupancy.

• Studios / Efficiencies (Oceanfront or Oceanview): These are essentially open-concept rooms (often called “1BR efficiency” on the hotel’s site) with a bed or two, a sitting area, and a kitchenette or full kitchen in some cases. At Holiday Sands North, many of the 1BR oceanfront efficiency units feature two queen beds and a full kitchen in one open space, plus an oceanfront balcony. An oceanview studio (facing the side or boulevard) might have a partial view and possibly slightly smaller size or fewer amenities. Generally, studios and efficiencies cater to couples or small families on a budget – they offer the lowest rental rates in the building but also tend to have the lowest purchase prices.

• 1-Bedroom Suites (Oceanfront or Oceanview): Some units are true one-bedrooms with a separate bedroom plus a living area and kitchen. For example, Holiday Sands North’s Type C and Type B units in the North Tower are 1BR configurations, some labeled “non-efficiency” which likely have a separate bedroom and no full kitchen (more like a hotel suite), and some “efficiency” which include a kitchen. The oceanfront 1BR suites have direct beachfront balconies and can sleep 4–6 (using sofa beds or murphy beds), making them very popular with small families. Oceanview or boulevard-view 1BR units (e.g. Type D, E, H) face the city or pool and usually trade the direct ocean panorama for a lower price point. They may be in the rear of one tower with views of Ocean Blvd and a side glimpse of the ocean. From a performance standpoint, oceanfront one-bedrooms command higher nightly rates and often higher occupancy than their oceanview counterparts. Travelers will pay a premium (often ~10–20% more) for a direct ocean vista and the ability to hear the waves from their balcony. Oceanview units, while often identical in size and interior, must be priced a bit lower to attract bookings. The difference is evident in guest demand – oceanfront rooms tend to book first, especially in peak season, whereas an oceanview unit might need a small discount or extra marketing to fill the same dates.

• 2-Bedroom Condos: These are the largest units at Holiday Sands North, suitable for larger families or groups (often sleeping 6-8 guests). The resort has 2BR oceanfront “efficiency” condos in the South Tower (with two queen beds in one room and a sleeper sofa in the living area), as well as 2BR standard units with pool/boulevard view in the North Tower (Type G). The oceanfront 2BR units are a highlight – they have a private ocean-facing balcony and even feature perks like a jacuzzi tub in the bath. Oceanfront 2BRs are in limited supply (only a couple of those in the complex), so they often achieve very strong rental numbers. The pool/boulevard view 2BR (north tower) offers a view of the pool deck and cityscape rather than the ocean directly – these will rent for less than oceanfront, but still appeal to budget-minded families who need two bedrooms. In terms of performance, a 2BR oceanfront can often achieve the highest Gross Rental Income (GRI) of any unit type at Holiday Sands North, simply because it can accommodate more guests and charge higher rates per night. Families in peak summer might pay $300+ per night for a 2BR oceanfront unit versus perhaps $200–$250/night for a 1BR oceanfront. Meanwhile, a 2BR with no ocean view might have to settle for maybe $180–$220/night on summer weekends. Occupancy for 2BR units can be slightly lower in off-season (larger groups travel less frequently off-peak), but in summer they are highly sought after.

Oceanfront vs Oceanview Summary: Oceanfront units undeniably have an edge in both rental rate and occupancy. Guests browsing Airbnb or VRBO often filter for “oceanfront” and are willing to pay a premium for that experience. An investor can expect an oceanfront condo to gross roughly 10–20% more revenue than a comparable oceanview/unit in the same building, all else equal. This is supported by the resort’s own positioning: Holiday Sands North markets its affordable 2BR by noting one is oceanfront and another is pool-view – indicating different price tiers for essentially the same size unit. Of course, oceanfront units usually cost more to purchase as well, but the rental ROI (cap rate) often still comes out ahead due to the stronger income.

Below is a table of estimated financial performance for representative unit types at Holiday Sands North, using 2023 average figures. (Note: “Oceanview” here can include pool/boulevard view units which have limited ocean visibility. GRI = Gross Rental Income; NOI = Net Operating Income after typical expenses. These assume the owner is self-managing via Airbnb/VRBO, not using the onsite rental program – we will discuss the difference in the next section.)

Table Notes: These figures are illustrative estimates. HOA (Homeowners Association) fees at Holiday Sands North include building insurance, maintenance, common utilities like cable TV/internet, pool upkeep, etc., and are substantial – for example, a 1BR in a comparable Myrtle Beach oceanfront resort had an HOA fee of $874 per month. We’ve incorporated property tax and insurance in the “fixed expenses” column as well – roughly, property taxes are about 1% of assessed value annually (so a $200K condo might incur ~$2,000/yr in property tax if non-owner-occupied), and HO6 condo insurance for contents might be a few hundred dollars. NOI assumes self-management where the owner handles bookings/cleanings; if using a rental management service, the net would be lower (we’ll quantify that next).

As shown, oceanfront units tend to generate higher NOI even after accounting for slightly higher HOAs for larger units. A 1BR oceanfront’s gross of ~$30K might net around $20K after expenses (50% margin), whereas a similar 1BR with a lesser view might net ~$13K–$15K after costs. The 2BR oceanfront shows the highest absolute NOI (mid-$20Ks possible), which makes sense given its strong gross income. Keep in mind these numbers can fluctuate with market conditions – e.g. an exceptionally strong summer or a hurricane-impacted fall can swing GRI by a few thousand in either direction. But overall, they provide a ballpark for what an investor can expect in today’s climate.

Renovation Impact & Guest Preferences

One critical factor affecting a unit’s performance is its condition and updates. Holiday Sands North is an older resort (the original tower is several decades old, with the newer south tower added in 2006). Many units can appear a bit dated if they haven’t been renovated recently. Guests frequently comment on this in reviews – “rooms are a little dated but clean with comfortable beds”, as one TripAdvisor review noted. Another guest mentioned that the rooms “could probably use a little facelift,” although they still had a great stay. These comments underscore an opportunity: units that undergo modern renovations often enjoy higher guest satisfaction, better reviews, and even higher rental rates.

Renovation Strategies: Successful investor-owners often update the décor and amenities of their condo to stand out from the hotel-managed units. This could include installing durable LVP flooring (instead of old carpet), refreshing the paint with a coastal color palette, updating kitchen appliances or adding a tile backsplash, and modernizing the furniture (no one wants a saggy 20-year-old couch on vacation!). Even small touches like smart TVs, a new mattress, or stylish wall art can make a difference in photos and reviews. The goal is to make your unit feel more like a “chic beach condo” rather than a generic hotel room.

The payoff for renovations can be significant. An updated unit will photograph better for Airbnb/VRBO listings and likely attract more bookings at higher nightly rates. Guests often specifically mention in reviews when a condo is “updated” or “well-maintained,” which in turn drives future bookings. For instance, if two identical 1BR oceanfront units are available at Holiday Sands North – one with 1990s-era bedspreads and old cabinets, and another fully renovated in 2022 – the renovated unit can likely charge a premium and still book up faster. Travelers have become savvy from browsing platforms; a rental with modern finishes signals a higher quality stay.

Additionally, a renovated unit may garner better online ratings, which feeds the algorithm on booking sites. Higher ratings improve visibility in Airbnb search results, creating a virtuous cycle of more bookings. In contrast, a poorly maintained unit might get some middling reviews that mention maintenance issues. Those reviews can really hurt an investor’s rental income potential over time. Thus, investing in your unit’s condition is directly tied to maximizing rental performance. Many Myrtle Beach investors report that a renovation can pay for itself via increased income within a couple of peak seasons, especially if the previous condition was holding the unit back.

Guest Preferences & Booking Drivers: Aside from condition and view, what do guests at Holiday Sands North tend to value? Being a family-oriented resort, space and bedding configuration are important – units that can comfortably sleep a family of 5-6 (e.g. with a sleeper sofa or murphy bed in addition to regular beds) are highly marketable. Families also love the amenities: the lazy river, pools and oceanfront lawn are huge selling points. A look at the resort’s description shows it prides itself on these “endless amenities”, and indeed a family might choose Holiday Sands North over a competitor specifically for the lazy river or the on-site cafe for convenience. Owners should leverage this in their listings (e.g. highlight “Resort amenities include indoor heated pool and lazy river – fun for all ages year-round” in your Airbnb description).

Moreover, location is a big guest preference driver. This resort’s downtown boardwalk location means guests can walk to many attractions – this appeals especially to first-time visitors who want to park the car and explore on foot. Many reviews praise the convenience of “location was perfect, we never had to move our car!”. An owner might emphasize that in marketing: “steps from the SkyWheel, walk to restaurants and attractions.” This urban oceanfront location differs from some quieter Myrtle properties, so it attracts a segment that enjoys a bit of activity and nightlife nearby.

On the flip side, being downtown means parking is across the street in lots (not uncommon for Myrtle Beach, but worth noting). Some guests mention parking is a bit limited or across Ocean Blvd. An owner should set proper guest expectations about parking procedures to avoid surprise (Holiday Sands North has multiple private lots just across the street for guests).

In summary, guests at Holiday Sands North prefer clean, updated units with great views and appreciate the family-friendly amenities and convenient location. To maximize occupancy and rates, an investor should keep their unit updated and highlight everything that makes the resort appealing to its target demographic (families and couples looking for an affordable oceanfront getaway).

Rental Management: On-site Program vs. Self-Management (Airbnb/VRBO)

A crucial decision for any Holiday Sands North condo investor is how to manage rentals: join the on-site rental management program, hire an external property manager, or self-manage via platforms like Airbnb and VRBO. Each option has financial implications.

On-site Rental Program: As a traditional hotel, Holiday Sands North offers an in-house rental management service for owners. In this arrangement, the hotel’s staff handles finding guests (through the hotel website, OTA bookings, walk-ins, etc.), front desk check-in, housekeeping, and maintenance. The owner’s income is then a split of the revenue. Typically, condotel on-site programs in Myrtle Beach take a sizable commission – often around 40-50% of the gross rental receipts (this covers their marketing, cleaning, staffing, etc.). For example, across Myrtle Beach, property management fees can range widely from about 10% (for purely listing service) up to 50% for full-service vacation rental management. On-site programs tend toward the higher end of that range because they operate like a hotel, providing daily housekeeping and absorbing all operating costs. If an owner goes this route, the NOI will be roughly half of the GRI (before HOA and other expenses). The upside is true hands-off passive ownership – you get a monthly check (and hopefully some owner usage privileges) and don’t have to deal directly with guests at all. It’s hassle-free, but the cost is steep in terms of lost potential income.

Self-Management (Airbnb/VRBO): Many modern investors choose to self-manage their condo as a vacation rental. This involves listing the unit on Airbnb, VRBO, or similar platforms, communicating with guests, coordinating cleanings and maintenance, and handling all pricing and marketing. The reward for this work is significantly higher net income. Instead of paying a 40-50% commission, you might only pay the platform’s fees (~3% to Airbnb, for example) plus cleaning service fees. Essentially, you are acting as the property manager. In the earlier table, our NOI estimates assumed self-management, which is why the margins look relatively healthy. If those same scenarios were on the hotel program, you’d likely need to halve the income. It’s not uncommon to see an Airbnb-managed unit gross $30,000 in bookings that would have only netted maybe $15,000 to the owner if under hotel management. One Myrtle Beach rental management firm pitches that owners can make “up to 50% more” on their condo by switching to dedicated vacation rental management (or self-management) versus traditional methods.

That said, self-management requires effort and isn’t for everyone – you effectively become a small hospitality business owner. You’ll need reliable local cleaners and handymen on call. You’ll also need to monitor pricing (using dynamic pricing tools or manual adjustments) to stay competitive. However, many owners find this manageable even remotely, thanks to tech like smart locks and security cameras (for entrance monitoring), and the fact that Myrtle Beach has a large support industry for vacation rentals (cleaning companies, etc., often at reasonable cost due to scale).

Hybrid / Third-Party Management: If an owner wants better returns than the on-site program but cannot or does not want to handle day-to-day management, there are many independent vacation rental management companies in Myrtle Beach. These companies (e.g. local realty management firms or national ones like Evolve, Vacasa, etc.) will handle the Airbnb listings, guest comms, and turnarounds for a fee that’s usually around 20–30% of gross rents. That’s a middle-ground solution. The owner still usually pays for things like cleaning (sometimes passed to guest) and supplies, but the management firm optimizes the listing and takes the heavy lifting off your plate. With these, your net might be 70-80% of GRI (versus ~50% with the hotel program).

Financial Impact Example: Let’s illustrate the difference: Suppose a 1BR oceanfront condo grosses $30,000 in a year on Airbnb. If self-managed, after perhaps $3K of cleaning fees (which guests often pay separately) and a few minor expenses, you might keep ~$27K. Subtract HOA and taxes, etc., and you net maybe $17K as we showed. Under an on-site program, that $30K gross might be split 50/50 – so you’d get $15K. After HOA and expenses, you might net only ~$5K – barely a 2-3% yield on a $200K condo, which is not great. Even with a third-party manager at, say, 25%, you’d keep $22.5K of the gross, and net perhaps $12-13K after fixed costs – still significantly better than $5K. This dramatic swing in net income is why many investors now favor self-management or hiring a dedicated rental manager over leaving it with the condotel front desk.

It’s worth checking if Holiday Sands North’s HOA or bylaws mandate use of the on-site program or impose any restrictions on outside rentals. Some older resorts had clauses to encourage using the hotel rental desk. However, many condotels in Myrtle have seen owners successfully go independent. Given that we see Holiday Sands North units listed on Airbnb/VRBO (owners advertising “oceanfront condo at Holiday Sands North” in the descriptions), it appears owner rentals are allowed. One caveat: owners who rent on their own will need to handle things like collecting and remitting accommodations taxes to the city/state, and ensure cleaners follow the HOA standards. But these are standard procedures easily managed with the help of software or a good CPA.

In summary, Airbnb/VRBO self-management can significantly increase profitability for an investor, at the cost of some personal time and effort. Meanwhile, the on-site rental program offers simplicity and is essentially “mailbox money,” but with far lower returns. The best strategy depends on the owner’s lifestyle – but financially, to maximize ROI, leaning toward self-management or a hybrid approach is the clear winner in this market environment.

On-Site Amenities & Their Impact on Bookings

Holiday Sands North’s amenity package is a strong selling point and does positively impact occupancy and rental rates. Let’s briefly review the on-site amenities and how they influence guest bookings and investor strategy:

• Pools & Lazy River: The resort features both indoor and outdoor pools, hot tubs, a lazy river, and kiddie pools. These water amenities are very attractive to families. They provide all-day entertainment for kids and allow the resort to market itself as a “water lover’s haven”. For owners, this means even on a rainy day or in cooler months, guests have something to do (swim indoors, etc.), making them more likely to book in shoulder seasons. The lazy river in particular is mentioned in promotional materials as a highlight. If a competing condo lacks such amenities, Holiday Sands North can often win the booking. Investors should definitely mention these features in listings (many do – e.g. “enjoy our indoor lazy river and pools even if the weather doesn’t cooperate”). It can make a difference in converting lookers into bookers.

• On-Site Restaurant (Oceanfront Café): There is a casual café on the property serving breakfast and lunch with ocean views. While this doesn’t directly increase rental income, it’s part of the convenience factor that draws guests. A family knowing they can grab breakfast downstairs or a quick lunch by the pool might choose Holiday Sands North over a condo with no dining on-site. It contributes to higher occupancy, especially for the hotel’s own bookings. Owners can mention this as well: “We have an oceanfront grill on-site for your convenience.”

• Fitness Center & Arcade: The exercise room and arcade give adults and kids additional activities on property. Again, these are small perks that enhance guest satisfaction. A happy guest is more likely to leave a good review, return for a repeat stay, or refer friends – all indirectly boosting an owner’s long-term rental performance.

• Boardwalk Access & Oceanfront Lawn: The resort has an oceanfront lawn area where people can relax, and it directly accesses the boardwalk. This essentially extends the amenity list beyond the hotel – the Myrtle Beach Boardwalk itself is a 1.2-mile attraction with shops, bars, and entertainment. Being able to step out of the hotel and onto the boardwalk is a huge draw. The impact is that units here can sometimes fill shoulder season weekends when there’s a festival or event on the boardwalk, whereas a similar condo 5 miles south might sit empty. For instance, if there’s a fall food festival downtown, visitors will prefer to stay at a place like Holiday Sands North and you can price accordingly.

To quantify the impact: these amenities and location allow owners to charge perhaps 5-10% higher rates than a comparable unit in a resort with fewer amenities or a less central location. They also likely contribute to a few points higher occupancy. In a competitive rental market, those small percentages add up to thousands more in annual revenue. Amenities also help with occupancy in winter – Snowbirds (seasonal monthly renters) often choose resorts with indoor pools and gyms to enjoy during their multi-month stays. Holiday Sands North checks those boxes, making it easier to secure long off-season bookings (e.g. a retired couple renting Jan–March might pick this resort for its amenities and walkability). Some owners successfully rent out to Snowbirds at, say, $1000–$1200/month in winter per 1BR – not hugely profitable but it covers the HOA in the off-season and keeps the unit occupied.

In summary, the on-site amenities and prime location of Holiday Sands North are key advantages. They enhance marketability and support stronger year-round performance. Investors should factor this in when projecting occupancy and should leverage these features in their marketing to maximize bookings.

HOA Structure and Financial Impact

Every investor in a condo-hotel like Holiday Sands North must carefully consider the Homeowners Association (HOA) structure, dues, and rules, as these can significantly affect your net income and ownership experience.

HOA Dues: Holiday Sands North’s HOA fees are on the higher side (as is common with oceanfront resorts) because they include funding for all the amenities and many utilities. Based on similar properties, monthly HOA fees can range roughly from $600 for smaller studios to $900+ for larger 2BR units. We saw an example at Holiday Sands South (a comparable sister property) where a 1BR condo’s HOA was $874 per month. Holiday Sands North would be in a similar ballpark. These fees typically cover: building insurance (wind/flood/fire for the structure), exterior maintenance and repairs, pool maintenance, elevator maintenance, cable TV and WiFi in the units, water/sewer, trash pickup, pest control, and common area utilities. Essentially, a large portion of operating expenses are pooled into the HOA. Owners are still responsible for their unit’s interior upkeep and contents insurance, and property taxes are separate.

The HOA fee’s financial impact is substantial – often it’s the single largest expense item, even more than the mortgage in some cases. In our table, for example, we estimated ~$8k–$11k in annual HOA+fixed costs, which is predominantly HOA. That can eat 30-50% of your gross rental income. Thus, investors must factor in HOA fees when calculating cash flow. A condo with an extremely high HOA can still be a fine lifestyle choice (if you use it often), but as an investment, you’d want to ensure the rental income comfortably exceeds the HOA+tax carrying costs.

One positive aspect is that because HOA covers many utilities, the owner doesn’t have separate bills for cable, internet, water, etc. Those are covered – making management simpler. Also, insurance being included (usually the master policy covers the structure; owners carry a smaller “walls-in” policy) means you’re protected as part of the group policy which is efficient for such a building.

HOA Reserve & Assessments: It’s worth inquiring about the HOA’s reserve funds and any upcoming capital projects. Oceanfront buildings take a beating from salt air and weather, so periodic renovations (paint, concrete restoration, new roofs, etc.) are needed. A healthy HOA will have reserves to cover these or plan special assessments. For example, if they decide to remodel the hallways or update the elevators, owners might get hit with a one-time assessment if reserves aren’t sufficient. Smart investors review past HOA meeting minutes and financials to see if Holiday Sands North HOA is well-managed. There have been cases in Myrtle Beach where unexpected assessments surprised owners. We don’t have specific info on any at HSN, but prudence is key. The HOA fee we pay should be building toward such needs.

HOA Rules: The HOA also sets rules that can affect rental operations. For instance, quiet hours, pet policies (most likely no pets for renters), occupancy limits (e.g. a facebook comment noted “per HOA regulations, max occupancy is 6” for certain units), etc. There may also be rules about the appearance of the doors/balconies to keep uniformity (can’t hang towels over the balcony, etc., which the hotel will enforce for you). As an owner, you become a member of the HOA and have voting rights on matters, typically. Holiday Sands North Inc (the family corporation) likely still owns some interest in the building, possibly even some units, and might manage the HOA or at least play a big role in it. Understanding that relationship is useful – it might actually be good, as they have incentive to maintain standards and property value.

From a financial view, the HOA fee effectively functions like a fixed expense that reduces NOI. High HOAs are the nature of condotels; they’re not “bad” if they provide value (security, amenities, maintenance) that in turn keeps the rentals flowing at high rates. But an investor should always run the numbers. For example, if HOA is $10k/year and property tax $2k, that’s $12k before making a dime of profit. If a unit only grosses $15k, that owner loses money (which might be fine if they mainly use it for personal vacations). As an investor, you’d be targeting units that gross well above the HOA+tax, ideally double or more, to leave room for mortgage and profit. That’s why the larger oceanfront units, despite higher HOAs, often make better investments – their income potential scales up more than their expenses do.

In conclusion, Holiday Sands North’s HOA is a critical piece of the financial equation. It covers a wide array of services (making the rental more turnkey and appealing to guests) but at a high cost. A savvy investor will budget for the HOA dues and keep an eye on the HOA’s management, treating it as a partner in protecting and enhancing property value. When comparing units, consider not just the asking price but also the HOA: sometimes a slightly more expensive unit with a lower HOA can be a better deal in the long run than a cheaper unit with an exorbitant HOA.

Investor Strategies: 1031 Exchanges and Self-Directed Retirement Funds

Investing in a condo at Holiday Sands North can be part of a larger investment strategy. Two approaches of particular interest to savvy investors are 1031 like-kind exchanges and using self-directed retirement accounts (IRA/401k) to purchase real estate. Here’s how these can be utilized:

1. 1031 Exchange – Tax-Deferred Swapping:
Section 1031 of the Internal Revenue Code allows an investor to defer capital gains taxes when selling one investment property and buying another, as long as both properties are “like-kind” and the transaction adheres to specific rules. In practice, this means if you sell an investment property (say, a rental home or another condo) and have a profit, you can roll those proceeds into the purchase of a “replacement” property of equal or greater value – such as a unit at Holiday Sands North – and defer paying any capital gains tax on the sale. The tax is not eliminated, just postponed; your cost basis transfers to the new property. Many real estate investors use 1031 exchanges to trade up properties without losing a chunk of equity to taxes each time. For example, one might sell a $150K condo in another city and exchange into a $250K 2BR oceanfront condo at Holiday Sands North, paying no taxes on the sale (assuming they follow the IRS exchange rules like identifying the new property within 45 days and closing within 180 days, etc.).

For a vacation rental condo to qualify as “like-kind” investment property, you need to treat it as an investment, not just a second home. The IRS requires that both the relinquished and replacement properties be held for productive use in a trade or business or for investment. That means you should rent out the Holiday Sands North condo (at least for a majority of the time) and not use it purely for personal use if you acquired it via 1031 exchange. Occasional personal use is fine (there are safe harbor guidelines, e.g. using it < 2 weeks a year or 10% of rental days), but the primary intent should be income generation. Fortunately, the IRS has, in private rulings, allowed vacation properties in 1031 so long as the owner does indeed rent them and only uses them within permitted limits. In short, yes, a Myrtle Beach vacation rental condo can qualify for 1031 exchange treatment – it is considered like-kind to other real estate as long as it’s an income property. This strategy is great for an investor who might be reallocating from another market or consolidating from multiple smaller rentals into one manageable resort condo.

2. Using Self-Directed IRA or 401(k) Funds:
Some investors choose to buy real estate through their self-directed IRA (SDIRA) or a Solo 401(k). These are specialized retirement accounts that let you invest in alternative assets like real estate (beyond just stocks and mutual funds). The appeal of using an IRA/401k is that all rental income and capital gains grow tax-deferred (or tax-free in a Roth IRA) within the account. For example, if your IRA buys a Holiday Sands North condo, all the rent checks would go back into the IRA, and if you sell the condo later at a profit, that gain is tax-sheltered in the IRA. According to experts, investing in property with an SDIRA enables you to defer taxes on any gains and even reinvest those gains into new property while maintaining tax advantages. In essence, it’s like the IRA is the owner – so the IRA doesn’t pay taxes on rental income (it accumulates untaxed), and you don’t pay personal tax until you withdraw funds from the IRA in retirement (unless it’s a Roth IRA, in which case withdrawals can be tax-free).

While this sounds great, there are important rules: the IRA owner (you) cannot use or directly benefit from the property personally. It must be for investment only – no personal vacations in your IRA-owned condo, as that would be a prohibited transaction. All expenses must be paid from the IRA, and all income goes into the IRA. If financing is involved, it has to be a non-recourse loan (you can’t personally guarantee an IRA loan). Also, leveraged IRA property income can incur UDFI tax (Unrelated Debt-Financed Income tax) on the portion of income attributable to financing. Many investors simply pay cash via the IRA to avoid that complexity.

Similarly, a Solo 401(k) (if you’re self-employed and have one) can also own real estate, often with slightly more flexibility and no UDFI on leveraged properties up to certain limits. The big picture is, using retirement funds can be a way to invest in Holiday Sands North without needing liquid personal cash, effectively diversifying your retirement portfolio into a real asset. But one must follow IRS rules carefully to avoid penalties (no mixing personal use, no renting it to yourself or family, etc., and use a custodian or proper structure).

Combining 1031 and Retirement Accounts: It’s worth noting you generally cannot 1031 exchange into or out of an IRA-owned property, because in a 1031 you must buy the replacement property titled the same way as the sold property (and an IRA is a separate entity). There are complex ways involving partnerships or so-called “drop-and-swap” into a TIC with an IRA, but that’s beyond scope. Typically, treat these strategies separately: 1031 is for taxable-held properties, and SDIRA purchases are a different path.

For an investor thinking of selling a different property and buying at Holiday Sands North, a 1031 exchange could save tens of thousands in taxes, boosting your effective investment power. Meanwhile, an investor with a large IRA who wants to diversify into real estate might find buying a condo via a self-directed IRA a convenient, income-producing long-term hold. Both strategies are about optimizing the tax side of the investment. A concrete example: An investor sells a $250K rental home in New York that has $100K in appreciation – normally around $15K of capital gains tax would be due. Instead, they do a 1031 exchange into a $250K Myrtle Beach condo, deferring that tax and thus essentially having $15K more working for them (which could equate to the first few years of rental income!). Or consider someone with $150K in a Roth IRA – they could buy a small condo cash, have the rental income build up in the Roth tax-free, and later in retirement withdraw rental profits tax-free as well.

In summary, 1031 exchanges and self-directed retirement accounts are tools to maximize the financial efficiency of real estate investing. For Holiday Sands North investors, a 1031 exchange can be used to acquire a unit without immediate tax drag, and a self-directed IRA/401k purchase can turn a vacation rental into a powerful retirement asset, all while deferring or eliminating certain taxes. It’s recommended to consult with a CPA or attorney who specializes in these strategies to execute them correctly, but they are absolutely viable paths for those looking to invest in these condos in a tax-smart way.

Conclusion & Key Takeaways for Investors

Holiday Sands North on the Boardwalk represents a compelling investment case for short-term rental property investors seeking both income and lifestyle benefits. This case study has explored how the property’s location, unit types, rental performance, and operational considerations come together to influence an investor’s returns.

To recap the actionable insights:

• Robust Rental Income Potential: Even with recent market normalization, Myrtle Beach short-term rentals are achieving solid revenues. At Holiday Sands North, a well-marketed oceanfront 1BR can gross on the order of $25K–$30K+ per year, and a 2BR can gross well into the $30Ks. Despite high HOA fees, there is opportunity for healthy cash flow if managed efficiently. Always run conservative projections (assume ~55% occupancy at market ADR) to ensure the numbers pencil out.

• Unit Selection Matters – Oceanfront and Larger Units Win: Data and experience show that oceanfront units outperform oceanview units in both occupancy and nightly rate, which leads to higher GRI and NOI. Likewise, larger units (1BR vs studio, 2BR vs 1BR) can generate disproportionally more income relative to their higher costs. If your budget allows, leaning toward an oceanfront 1BR or 2BR may yield the best ROI. Smaller or non-view units can still be profitable, but expect a narrower margin and target a lower purchase price on those to compensate.

• Renovation and Good Reviews are Gold: Investing in updating your unit and keeping it modern and clean will directly boost your rental success. Guests reward updated units with bookings and good reviews, whereas “tired” units may struggle. Given that some Holiday Sands North rooms are noted as dated, an investor can gain a competitive edge by making theirs one of the standout renovated options. Budget for updates every few years to keep up with guest expectations.

• Maximize Income via Self-Management (if feasible): The analysis clearly indicates the significant financial advantage of self-management or using a low-cost vacation rental manager. On-site management, while convenient, could take ~40-50% of your rental revenue, often turning what could be a 8-10% ROI into a break-even. Investors aiming for strong cash flow should plan to list on Airbnb/VRBO and manage turnovers, or hire a third-party service that charges a more modest fee. The extra income retained is well worth the effort in this market.

• Leverage Amenities and Location in Marketing: The resort’s amenities (pools, lazy river, etc.) and prime boardwalk location are key selling points. These features not only allow slightly higher pricing, but they help with occupancy in off-peak times. An investor should highlight these in listings and possibly adjust strategy to capitalize on local events (e.g., adjust pricing or promote monthly off-season stays to snowbirds given the indoor pool and downtown convenience). Essentially, use every asset at your disposal to differentiate your offering – you’re not just renting a condo, you’re renting a whole resort experience.

• HOA and Costs – Know Your Numbers: With HOA fees around the ~$800/month range (varies by unit), plus property tax and insurance, an owner has significant fixed costs. Before purchase, ensure the expected rental income leaves a sufficient buffer after these expenses. Also stay involved with the HOA, attend meetings or read updates to anticipate any changes or assessments. A well-run HOA will protect your property’s value and the resort’s reputation (which in turn affects rentals). Think of HOA fees as an investment in maintaining the quality of the property – which you recoup through sustained rental demand and property appreciation.

• Exit and Long-Term Strategy: The condo market has seen values rise modestly year-over-year. Holiday Sands North units have liquidity (there’s usually a steady flow of buyers looking for affordable oceanfront condos), so an investor can plan an exit when it makes sense – possibly via a 1031 exchange into a bigger property down the line. Meanwhile, using vehicles like a 1031 exchange at acquisition or sale can save on taxes, boosting overall returns. Alternatively, holding the property in a retirement account can turn it into a long-term income generator with tax-deferred growth. Be sure your strategy aligns with your financial goals – whether it’s maximum cash flow now, personal use (a bit of vacation enjoyment), or long-term equity build.

In conclusion, Holiday Sands North offers a blend of strong short-term rental income and the enjoyment of owning a piece of a beachfront resort. Investors who do their homework on market data, carefully manage their unit (both in terms of upkeep and rental operations), and use smart financial strategies can see excellent results. For example, an investor might use a 1031 exchange to acquire a 2BR oceanfront unit, renovate it to top condition, self-manage rentals via Airbnb to gross $40K/year, pay the HOA/expenses of ~$12K, and net around ~$28K – which on a ~$300K total investment (for purchase and reno) is roughly a 9% net yield, plus enjoying some personal beach vacations essentially for free. Not to mention any property appreciation over time is an added bonus.

As always, due diligence is key: verify all numbers with current rental statements, check the latest HOA financials, and perhaps stay as a guest in the resort to experience it firsthand. But with the information presented – current rental trends, financial figures, and strategic considerations – an investor should be well-equipped to evaluate short-term rental ownership at Holiday Sands North and make an informed decision. This case exemplifies how a savvy approach can turn a coastal vacation condo into a profitable, enjoyable investment for years to come.

Sources:

• Myrtle Beach short-term rental market stats (occupancy ~62%, ADR ~$121, ~$25K/yr revenue); softening in 2023–24.

• Myrtle Beach condo price trends (+6.2% YOY, median ~$239K).

• Holiday Sands North amenities and location details.

• Guest feedback on unit quality (clean but dated rooms).

• Example financials: HOA fee ~$874/mo for 1BR condotel; management fees 10–50% range.

• 1031 exchange rules (like-kind investment property, tax deferral).

• Self-directed IRA real estate investing (tax-deferred gains reinvestment).

Disclaimer: All information given is meant to be educational. I am only passing on historical information shared with me by owners, rental companies, and various publications. I am not guaranteeing these numbers, nor can I guarantee future rentals or appreciation. This information is not intended to replace your own research, or to provide legal, investment, or financial advice. Please consult an attorney for legal advice.