Island Dunes (North Myrtle Beach): Investment Case Study

Island Dunes is a boutique oceanfront condo resort at 1019 S. Ocean Blvd, North Myrtle Beach (Cherry Grove area). Built in 1984, it comprises just six units (three floors, two units per floor) with no elevator. The low‐rise layout offers direct beach access via a boardwalk adjacent to the property. Resort amenities include an outdoor oceanfront pool, charcoal grill, and beach shower. Every unit has a beachfront balcony and free Wi-Fi, and living areas with wide ocean views. First/second-floor condos have covered balconies; third-floor “penthouse” units have open balconies. Island Dunes is one block north of the lively Ocean Drive/“Main Street” entertainment district – walking distance to restaurants, bars and arcades – and just a couple of miles from Barefoot Landing’s shops and theaters. (Notably, it’s popular with beach-music festivalgoers – Spring Safari and Fall Migration events are held in North Myrtle Beach each year.)

Key Amenities & Location: Oceanfront units (all 4BR/3BA) with gulf views; pool and grilling area; beach access walkway; high‐speed internet; parking (no trailers/motorcycles). Island Dunes’ setting on Ocean Drive offers immediate beach proximity and walkability (e.g. ~10 blocks to Main St). A recent MLS description notes: “Walkway to beach is right beside the complex… lots of natural light…end unit with windows in every bedroom”, underscoring the resort’s beachfront advantages.

Unit Mix & Floor Plans

All Island Dunes condos are 4-bedroom, 3-bath units of roughly 1,300–1,350 sq ft. Typical layout: open living/dining/kitchen on one side facing ocean, plus a private master suite facing the sea, and three additional bedrooms (each with windows, often side or rear views). End units benefit from extra windows; interior units share a common wall. Balconies span the width of the condo and are accessible from the living room and master. Floor-plan descriptions highlight a “fabulous floor plan” with bright, updated interiors. (By comparison, nearby high-rises like Buena Vista offer 1–4 BR variants; Island Dunes’ uniform 4BR size is unique for its small oceanfront inventory.)

Table: Recent Island Dunes sales (all 4BR/3BA). Source: MLS/Redfin/Zillow data.

Pricing Trends

Island Dunes has seen dramatic appreciation since 2019. In early 2019, mid-floor units (e.g. A-2) sold in the high $200Ks. By late 2022–2023, top-floor units fetched $525K–$596K. This roughly doubled prices in 3–4 years (due to strong demand and some renovations). For example, Unit B2 (2nd floor) closed at $596K in Dec 2023 versus Unit A2’s $285K in Apr 2019. Average price per square foot has climbed accordingly (roughly $455/sqft for recent sales). The local condo market remains tight: TraciMiles MLS data in May 2025 shows only 6 listings averaging ~$370K.

Rental Income Potential

Island Dunes is eligible for lucrative short-term rentals. AirDNA data for North Myrtle Beach show healthy metrics: average occupancy ~57%, ADR ~$341, and RevPAR ~$191 (annualized). These figures are up slightly year-over-year (+4% occupancy, +3% ADR). Note Island Dunes units (4BR/3BA) can often outperform the overall market ADR, especially in peak season. As a benchmark, KeyData/Short Term Rental reports note Myrtle Beach occupancy dipped ~22% from 2022 (supply surge) but ADR held firm; North Myrtle specifically saw RevPAR only ~21% below 2022 after a 7% ADR increase.

Key rental drivers: Summer peak (Memorial Day–Labor Day) commands the highest rates (possibly $400–$500+/night for 4BR), followed by shoulder seasons (spring/fall) buoyed by events. For example, beach-music events (Spring Safari, Fall Migration) drive high occupancy in April and September. Winter rates fall sharply (vacationers drop off in Dec–Feb). (Guest data for a comparable Cherry Grove tower—Buena Vista—showed 3BR summer ADR ~$300–$400, winter ~$80–$120.)

AirDNA Yearly Stats (NMB overall): ~10,800 active listings, with total annual revenue $34.9K per listing. Using AirDNA’s RevPAR ($191) and Island Dunes’ 6 units, a fully rented year could gross roughly $109K combined. More conservatively, a single 4BR might gross $35–50K/year (depending on management, cleaning, marketing). At the current sale price ($600K), this implies a gross rental yield ~6–8%. Net yields will be lower after HOA, taxes, insurance ($7K+) and booking fees.

Ownership Costs & Long-Term Value

HOA & Fees: Association fees are modest. Latest data show HOA dues $383 per quarter ($1,530/year) covering common-area maintenance, grounds, Internet, trash, etc. (By contrast, larger complexes often charge more in amenities fees.) Utilities and cable are separate. Real estate taxes in Horry County are under 1% of assessed value; on a $600K property, expect ~$3,000–4,000/year. Flood insurance is required due to oceanfront location (roughly $2–4K/year depending on coverage).

Appreciation & Resale: Island Dunes values have risen sharply, reflecting scarce supply and strong market demand. However, local experts caution that future price growth may moderate. A recent market report notes current Myrtle/Oceanfront condo prices are flat to slightly up – with no obvious declines yet, but also no dramatic run-ups expected. In short, we expect steady values from 2025–27 rather than double-digit annual gains. The complex’s limited inventory (only six condos) suggests resale is competitive. Well-maintained or remodeled units (as many have been) tend to attract quick interest.

Comparable Properties

Nearby oceanfront complexes provide context. For example, Buena Vista Plaza (Cherry Grove) is an 11-story tower with 1–4BR units. Buena Vista’s high-season rates for a 3BR reportedly hit ~$300–$400 per night (winter ~$80–$120). Larger resorts like Xanadu, Sea Castle, or Sunrise Pointe (also low-rises) have more units and amenities (often larger pools or oceanwalks) but also heavier HOA fees. In general, Island Dunes’ advantage is privacy (only six owners) and direct beach access. Its floor-area (≈1,300 sq ft) and 4BR size place it in a more premium rental category than 2–3BR condos, supporting higher ADR.

Demand Drivers

Vacation demand is bolstered by North Myrtle Beach’s beachfront and attractions. Island Dunes faces the Atlantic, with sand access literally next door. Guests prize the walkability to North Myrtle’s “Main Street” (Ocean Drive), with dozens of restaurants, bars and amusements (e.g. Fat Harold’s, T.I.G.E.R.S. preserve). A short drive leads to Barefoot Landing (retail and entertainment, including House of Blues and Alabama Theatre) and family attractions (Myrtle Beach Boardwalk, water parks). Annual events – notably the SOS beach music festivals (Spring Safari in April, Fall Migration in September) – flood the town with visitors. Golf courses, fishing piers (Cherry Grove Pier 1 mile north), and coastal state parks also add draw. In sum, Island Dunes’ prime beach location and proximity to NMB’s dining/entertainment hubs is a core driver of rental occupancy and pricing.

2025–2027 Outlook: ROI and Risks

Rental ROI: With occupancy and ADR holding steady, short-term rental ROI should remain attractive. For example, if a 4BR unit achieves 60% occupancy at an average nightly rate of $350, gross annual revenue ≈$76K. Subtracting 30% for management/marketing, and ~$5K HOA/taxes, yields a rough net of ~$47K – about 7.8% of a $600K price. Even if occupancy dips in shoulder seasons, the long-term tourist appeal (15+ million annual visitors to the Grand Strand) suggests sustainable demand.

Appreciation: Forecasts suggest stable pricing in 2025–2027 rather than further doubling. (One Realtor notes, “MLS shows no signs of prices decreasing; economists predict prices may remain flat rather than soar”.) Continued Bay—Area tourism growth and low inventory support values. However, rising interest rates and increased condo supply (new projects in MB/NMB) are cautionary factors. Insurance costs (storm risk) and tighter vacation-rental regulations could also affect net returns.

Risks & Opportunities: Potential risks include a downturn in travel or stricter short-term rental laws. On the other hand, opportunities exist in off-season rental strategies (seasonal lease, monthly tenants) and the resort’s appeal to multigenerational families/groups (4BR configuration). Upgrades (like recent top-to-bottom remodels in many units) allow owners to command premium rates. Overall, Island Dunes presents a robust income play with upside from continued tourism, tempered by moderate cap rates and policy uncertainties.

Sources: Local real estate listings, MLS and historical sale data; AirDNA market summaries; industry reports and realtor market updates; condo rental analyses. Each insight is grounded in these data.

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.