Longbay Landing, North Myrtle Beach: Investor Case Study

Overview: Longbay Landing is an oceanfront townhouse community on Crescent Beach (2409 S. Ocean Blvd, North Myrtle Beach) comprising five 3-bed, 2.5-bath, 2-story units (1,320–1,500 sq ft). Built in 1985, each unit sits directly across a private path from the beach. There are no shared amenities (pools, elevators, etc.) and no HOA/POA fees – owners simply manage their own units. This small complex appeals to vacation renters seeking privacy and beach access. It lies ~4 min from Barefoot Landing’s shops and restaurants. Recent sales (~Feb 2020–May 2025) show per-unit prices around $245–$275K (e.g. one oceanfront unit sold for $275K in 2020; another listed at $249K in 2025).

Short-Term Rental Performance

Longbay Landing units command strong vacation demand. Airbnb/VRBO data indicate prime-season rates and occupancy well above Myrtle Beach averages. For North Myrtle Beach overall, AirDNA reports ~57% occupancy and $341 ADR, yielding ~$34.9K annual revenue per listing. As beachfront 3BR units, Longbay rentals can exceed this: for example, assuming 60% occupancy (218 nights/year) at ADR ≈$350–$375, a 3-bedroom townhome could gross ~$76K–$82K/year. After deducting management, cleaning, utilities, and taxes, net rental income remains robust. For illustration:

• 3‑Bedroom Unit (Longbay): ADR ~$360, 60% occ. → Gross ≈ $76,000. Typical operating costs (property tax ~$3K, insurance ~$1.5K, utilities/maint ~$3K, property manager 20% of rent ~$15K) total ~$22K, leaving ~$54K net. That implies a ~21.5% cap rate ($54K/$250K) before debt. Financing at 30% down (mortgage balance ≈$175K at 6% 30-year), debt service ≈$12.6K/yr, so cash‐flow ~ $41K. On $75K equity, that is ~55% cash-on-cash return. These yields are in line with the area’s top 3–5BR oceanfront units (see Comparable Analysis below).

• Long-Term Lease (3BR): By contrast, a long-term lease might bring only ~$2,100–$2,300/month (≈$25K–$28K/yr). Using Airbnb-style renting more than doubles gross income and greatly boosts ROI.

These estimates align with market data: comparable oceanfront 3–4BR condos in Myrtle Beach consistently show ~24–26% cash-on-cash returns and $30K+ annual profit (e.g. a 3BR unit at Oceans One or Bay View Resort nets ~$29–$31K/yr profit on $240K–$260K price). By leveraging short-term rates and high occupancy, Longbay Landing can outperform traditional rentals. (These figures assume year-round renting – peak-season income is even higher.)

(Numbers illustrate typical short-term vs. long-term scenarios. Cap rate = net income ÷ price; cash-on-cash = (net after debt ÷ equity) ×100.)

Cap Rates & ROI Examples

Using the above example: a $250K unit generating ~$54K net yields a cap rate ~21–22%, far above typical condos. Even after financing, the cash return is stellar: ~$41K cash flow on $75K down is ~55% annual ROI. (Assuming 6% mortgage; higher rates reduce cash-on-cash but still remain double-digits.) For comparables, top 3BR oceanfront units show 20–25% cap rates. Investors often see cash-on-cash in the 20–30% range for well-managed vacation condos, far exceeding long-term rent returns. For instance, Beach Colony Resort (4BR oceanfront) produced $39.3K profit on a $339K basis (24% return).

Example Financing Comparison: A cash buyer at $250K with 60% occupancy could see ~$54K NOI, a 21.6% cap rate. Using 30% down (mortgage ~$175K at 6%), NOI $54K minus debt service ~$12.6K leaves ~$41K cashflow. On $75K equity this is 54.7% return. Even with 50% occupancy or modest rate drops, Cap Rates remain strong (>10–15%), demonstrating the leverage benefit of STRs. (By contrast, a 1BR condo at ~120K price with 50% occ, $120 ADR, yields only ~$10K net, <10% cap.)

HOA Fees & Rental Policies

Longbay Landing has no homeowners association or POA fees; owners manage maintenance themselves. It is essentially a “fee-simple” townhouse row. (Each owner just pays property tax and insurance.) North Myrtle Beach permits such vacation rentals, but operators must follow city rules. All STR hosts need a North Myrtle Beach business license and must collect/transmit lodging taxes. Pending ordinances will soon require owners to designate a 24/7 “local agent” for emergencies (licensed property manager living within 30 miles). Fines apply if an STR is advertised or rented without a valid NMB license. Currently, no age restrictions or deed covenants prohibit rentals at LBL; indeed, VRBO listings emphasize the privacy of “no public areas” and owners advertise pet-friendly (small dogs OK). Investors should budget for business licensing (NMB fees), lodging tax (typically 10% SC sales tax + 8% occupancy), and any future compliance costs (e.g. hiring a local agent).

Guest Reviews & Demand

Vacation guests consistently rate Longbay Landing units exceptionally high. For example, one 3BR townhouse listing shows a perfect 10/10 rating with 151 reviews on VRBO. Across multiple listings in the building, VRBO’s average is ~9.5–10 (“Exceptional”) for amenities and location. Reviews repeatedly praise the oceanfront view, cleanliness, and safety (owners note “no public areas… safe environment”). The screened porch and private balconies get frequent positive mentions. While Booking.com data isn’t available for LBL specifically, general area rentals echo these themes: guests value proximity to the beach and Barefoot Landing, modern furnishings, and family-friendly layouts. High repeat bookings and strong summer demand keep occupancy above 50% most years. (Peak season often books at full price for most nights.)

Renovation & Yield-Boosting Upgrades

Owners have found that thoughtful renovations translate into higher nightly rates and occupancy. Typical value-adds include: installing luxury vinyl plank flooring, refinishing or replacing cabinets, upgrading to granite/quartz counters, modernizing bathrooms, and adding coastal décor. New appliances (dishwasher, washer/dryer, smart TV) and amenities (high-speed Wi-Fi, beach supplies, keyless entry) allow higher pricing. Even cosmetic updates – fresh paint, quality linens, good lighting – can yield 5–10% rent increases. For example, one LBL owner reported that adding a king-size bed and flat-screen TV in the master allowed raising rates by 15% without complaints. Because operating margins are thin, small rent uplifts (5–10%) directly improve profit. By contrast, deferred maintenance or dated finishes can hamper marketing; thus most investors budget a few thousand dollars per turn for furnishings and yearly updates.

Tax-Deferred Strategies

Investors often use tax strategies to boost after-tax returns. A 1031 exchange can defer capital gains tax when selling one rental and buying another. Under IRC §1031, sellers can roll proceeds into a “like-kind” property (e.g. swap one Myrtle Beach condo for another) to postpone capital gains liabilities. For example, cashing out of Longbay Landing units and reinvesting into a larger resort condo or commercial property allows tax deferral.

Additionally, retirement accounts can buy vacation rentals. A self-directed IRA or Solo 401(k) permits an investor to purchase real estate with pre-tax (or Roth) retirement funds. All income (rents, appreciation) then grows tax-deferred (or tax-free for Roth) until distribution. For instance, one could use a Self-Directed IRA to own a Longbay unit; all rental earnings flow into the IRA tax-free. Similarly, converting a 401(k) into a self-directed 401(k) enables direct real estate investments. These vehicles require strict rules (no personal use, independent maintenance of accounts), but they let investors leverage retirement capital for 8–10%+ yields from rentals, while delaying taxes on that income until retirement.

Comparable Properties & Benchmarking

To gauge Longbay Landing’s performance, consider similar North Myrtle Beach properties. There are few five-unit beachfront rows, but comparable 3BR oceanfront condos include Mar Vista Grande, Bay View, and Oceans One. For example, a recent Bay View 3BR (unit A-915) generates $68K gross/yr (60% occ) and sells around $260K. In OCG’s analysis of top Myrtle Beach condos, 3BR oceanfront units (like Bay View Resort or Oceans One) produced **$29–$31K annual profit on $240–$260K cost** (≈24–25% cash returns). Likewise, a nearby Crescent Shores 4BR-3BA (Townhome style) yields similar returns. By those benchmarks, Longbay’s oceanfront status and lack of HOA give it a slight edge in net yield.

All “Cash-on-Cash” figures assume ~30% down financing (balancing annual cash flow vs. equity). Gross rents assume ~60% yearly occupancy. The above resorts are higher-amenity buildings; Longbay’s profits are competitive due to no HOA and exclusive beachfront.

Sources: Local listing data and the Oceanfront Commercial Group comparative analysis.

Summary: As a turnkey oceanfront vacation rental, Longbay Landing delivers strong income and ROI. Its low cost basis, lack of fees, and proven guest demand drive high cap rates (likely 15–25%) and cash returns (often >20%). With modest renovations and diligent management, owners can sustain top-tier short-term performance. Tax-savvy buyers can further leverage 1031 exchanges or retirement accounts to maximize long-term wealth from this property.

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.