How long will Myrtle Beach’s short-term rental conversion freeze last? What we know

The City of Myrtle Beach wants to ensure the area has enough hotel rooms, condos, and oceanfront homes to accommodate the massive surge of summer tourists who visit the area.

The issue now concerns whether a recent city policy to protect this industry, expiring in early 2025, will be extended.

In April 2024, the City of Myrtle Beach approved a temporary nine-month moratorium and pause on converting short-term rentals that allow occupants for less than 90 days into long-term units. The ban encompassed properties between the intersection of Highway 17 and Oceans Blvd. and Grande Dunes Blvd. , which coincides with the Myrtle Beach oceanfront that constitutes much of the city and allows for short-term rental properties.

The city approved the policy due to increased requests to convert short-term rentals for long-term use. To support its decision, the city cited a Myrtle Beach Area Chamber of Commerce statistic that claimed every 1,000 short-term rentals converted for long-term use would cause a $5.7 million loss in direct economic impact.

With the moratorium close to being halfway over, the question becomes: What will the findings show? Would converting short-rentals and hotels into long-term dwellings and condos hurt the Myrtle Beach economy?

Who’s studying Myrtle Beach’s oceanfront rental market, and will the moratorium be extended?

New City of Myrtle Beach Director of Public Information Meredith Denari said that the Greenville, S.C.-based firm Arnett Muldrow , which specializes in helping “communities that want to rebuild their aging downtown, reinvigorate their historic neighborhoods, and create economic development opportunities,” according to the company’s website, is leading the fact-finding mission.

In an emailed statement to The Sun News, Arnett Muldrow Partner Tripp Muldrow said the company would share its draft findings with the City Council in early October 2024.

“Ethical standards dictate that I share our draft findings first with our client (the City Council) prior to conversations with anyone else,” He wrote. “At that time, I will be more than happy to provide any clarification needed so your readers can understand the findings with the cooperation of the City Administration.”

While the analysis at the heart of the initial moratorium isn’t public yet, it’s also unclear if the city will choose to extend it beyond the initial nine months of the original proposal.

Denari said she didn’t have an answer as to whether the moratorium would get renewed beyond January 2025 but said moratoriums usually don’t get extended.

Myrtle Beach’s approach is also rather unique, as other cities and states take a more hostile posture towards short-term rentals. Several cities like Rock Hill, S.C. and Park Township, MI, have placed moratoriums on allowing short-term rentals, and the governor of Hawaii— also known for its tourism economy— supported proposed legislation to convert short-term rentals into housing for locals.

When asked if the city had taken inspiration from another municipality for the policy, Denari said she didn’t know.

Denari added that the area’s status as a destination for vacationers necessitated freezing any further plans by developers or property owners.

“As more people keep coming to the Grand Strand because it’s such a popular destination, specifically Myrtle Beach, we need those short-term rentals,” She said. “We can’t afford for the ones in our current inventory to be converted to long-term, and that’s why we’re doing this moratorium.”

The freeze has had an impact. Max Mellman, managing partner at Hybridge Capital Management, has said the moratorium affected his firm. Hybridge purchased the Sandcastle Oceanfront Resort in 2022 and The Yachtsman Resort in 2024 in Myrtle Beach. While the Sandcastle is converting into a premium brand hotel , Mellman said the moratorium impacted his firm’s plans for their properties.

He added that the firm wanted to convert the Yachtsman condos into long-term units and considered having an affordable housing option at Sandcastle before ultimately scheduling it for a renovation and transformation into a Voco by IHG. However, the moratorium halted those plans.

“You have a slew of hotels that are that need renovation,” he said in an interview with The Sun News. “These business owners need a way to salvage their transactions, and the only way to do so is through housing, and getting people to move to Myrtle will stimulate the economy. So it’s a win, win.”

Mellman said he understands the city’s position and wants to avoid a “domino effect” where thousands of short-term rentals and hotels leave the market. However, he said that older properties or independently run ones turning into long-term housing complexes would benefit local business owners in the Grand Strand and allow more people to live on the beach.

Mellman added he’s supportive of the current city government but that many hoteliers won’t convert their properties— especially branded or franchised locations— leading to the feared chain reaction scenario.

“Getting people to move to Myrtle Beach is essential for the growth. I know they have goals for housing. We were trying to solve that,” Mellman added. “We understand the rationale why because they think (converting short-term rentals to long-term ones) will take dollars away from the city, but in the long run, it’ll really help.”

How many hotel rooms and short-term rentals are in the Myrtle Beach area?

One statistic stands out if you visit the Myrtle Beach Area Convention & Visitors Bureau website and scroll to the industry research page.

The Myrtle Beach area has 157,000 room units —including hotels, condos and other rentals— available for visitors, which, according to the CVB, is on par with Las Vegas. On its website, the Las Vegas Convention and Visitors Authority states that Sin City has more than 156,000 hotel rooms alone.

The large supply of rooms and units highlights the clear need for these rooms to accommodate visitors, as the Grand Strand receives more than 17 million visitors a year. This vacationer-backed short-term rental economy also benefits the local government. The City of Myrtle Beach generates revenue through visitors staying in short-term rentals via a state accommodation tax and local hospitality tax.

This short-term rental supply includes many listings on Airbnb and VRBO. The short-term rental data tracking firm AirDNA reports almost 33,000 short-term rental listings on Airbnb VRBO or both in Myrtle Beach compared to more than 24,000 in Las Vegas , almost 22,000 in Panama City, Fla. and less than 14,000 in Daytona, Fla.