Myrtle Beach Short Term Rental Expenses: What Investors Need to Know

Avery Carl [00:00:03]:
Hey guys, it’s your host, Avery Carle. Welcome to the Short Term show special episode series on Myrtle Beach, South Carolina. I’m super excited to do this 10 episode deep dive into this market with you and I wanted to make a few notes for you first. So if you want to set up a search for properties or see current purchase prices or current income numbers in this market, you can do that at our website, the shorttermshop.com. if you just want to connect with us and hang out and talk about short term rentals more, you could do that in our Facebook group. It’s the same title as my book. It’s called Short Term Rental, Long Term Wealth. And you can also find the information on all of our other market short term show special episode series there as well.

Avery Carl [00:00:41]:
So we look really forward to hanging out with you over the next 10 episodes and we’ll catch you guys on the next one. Let’s go.

January Johnson [00:00:51]:
Foreign.

Avery Carl [00:00:56]:
Hey guys, welcome back to another episode of the Short Term Show Special Episode series on Myrtle Beach. Our previous episode was a really cool data experience with Erica from Brolio. So now we’re going to marry that with the expense information. I can’t find my words today with all the information you need on the expenses of owning in this market. Most properties in this market are going to be condos. There are a few single families as well, well more than a few, but mostly condos. Very condo heavy market. Kind of like Panama City beach where one of our panelists is.

Avery Carl [00:01:31]:
But we’ve got a really cool panel here to help us talk about expenses. You’re going to be familiar with both of them from previous episodes, other markets. First, I will introduce Tim Grillo. Tim, do you want to introduce yourself? Sure.

Tim Grillo [00:01:43]:
My name is Tim Grillo. I actually live in the Smokies and own short term rentals in Gulf Shores, Alabama. A couple condos there as well as some cabins in the Smokies. So love this stuff.

Avery Carl [00:01:56]:
Awesome. And then next we have January Johnson. January, you want to introduce yourself really quick?

January Johnson [00:02:01]:
Hi there. I live in Panama City. I am a native of Panama City, Florida and came back and own short term rental property there and I’m under contract in a condo on Myrtle Beach.

Avery Carl [00:02:12]:
Amazing. So let’s talk about the expenses here real fast. So condo expenses in a beach market, pretty similar across the board. But let’s talk about these things. So typically. Well, I don’t really want to get into HOA fees just yet, but that’s what, that’s where we’re going to go. We’re Going to go straight for the HOA fees. So JOA slash condo fees in markets like this, a lot of people that’s the first thing there that is like a red flag for them is oh, I don’t want, I don’t want to buy a condo.

Avery Carl [00:02:41]:
I don’t like condo fees. But why is that? Because a lot of times the condo fees will cover a lot of the expenses that you’d be having to pay anyway. So what, what do you guys typically see? Tim, I know you own a bunch of condos with what those condo fees cover.

Tim Grillo [00:02:57]:
Yeah, a lot of it is just really due diligence. To me, a condo fee isn’t a whole lot different than holding owning a single family home in a healthy condo building, you know, and when I say healthy, you know, one that’s mostly suited for short term rentals with good management in place. A lot of the expenses that you’re paying in towards you’d be paying for anyway. You know, it’s going to, you’d be going to the exterior of your own house or whatever. But also what you kind of got to look at is what all does HOA include? You know, some HOAs include all your water bills, your sewer bills, your cable, your Internet. Some include none of that. So, you know, if it looks like really high hoa, you just got to dig in and find out what’s that include. And then another thing I like to look at is what’s the culture of the HOA? Some HOAs will like artificially make their dues look kind of smaller by doing lots of assessments.

Tim Grillo [00:03:49]:
So like insurance has gone up over the last several years. They just keep hitting people with insurance assessments and then it looks like the HOA dues are smaller dollar and other ones do it the complete opposite. They’ll look like they’ll have really high HOA dues, but they may have huge reserves and they may have like no assessments. So you really got to dig in and, and look at what you’re, what it is. The buildings I’m in, you know, obviously we’ve done some of that legwork and I’m very happy with what the hoas cover and how it’s managed. And it’s a, it’s a, to me it’s a healthy, managed thing. That honestly is a nice break from a lot of single families I own in other markets because it’s way less to think about because I know there’s good management place and they’re taking care of the building. And all I got to worry is my four Walls and decor and everything on the inside.

Avery Carl [00:04:32]:
So yeah, totally agree with that. And I’ve got a $500 a month condo fee in my condo upstairs. And if you’re looking at things and you’re going, oh, okay, I’ve got my electric, I’ve got my insurance, I’ve got all these things and a $500 a month condo fee that kills my return, I can’t do that. Why do people buy these condos? They don’t make sense. And it’s because the condos pay for a lot of the things that you would be having to pay for on a single family. Anyway, I want to talk about assessments too really quick. So I think a lot of people get scared of assessments. They’re like, oh no, an assessment.

Avery Carl [00:05:03]:
I don’t want a condo, they’re going to hit me with an assessment. So when you own a single family, you know, the condo assessments are for capex items. So you need a new roof, we need to repaint the building. And then they assess everyone in the condo building a fee to go pay for those things. Well, when you own a single family, it’s kind of the same thing, but you’re just doing small payments over time. So small fixes or capex purchases or replacements over time. Whereas with condos you’re not doing any of that at all over time. And then you’ll be hit like once a year or once every two years to pay for those things and it’s just all at once instead of small payments over time.

Avery Carl [00:05:44]:
So you’re, you’re doing it either way. So it’s really nothing to be scared of condos in my opinion.

Tim Grillo [00:05:50]:
Yeah, I agree. And actually, you know, I’ve been hit with some rather large assessments on like total renovation projects and stuff. And I’ll be honest, at first it shocked me quite a bit and everything else. But what I kind of learned on the back side of it is just like a single family house, when you renovate a building boom, you’re one, it rents better because you have, you can take better pictures of everything and it’s a better experience for your guests. But also your, your property value tends to go up. You know, I mean, a fresh looking, brand new building is going to be worth more than, than something that’s all dumpy.

January Johnson [00:06:19]:
So I also like to look at HOA fees as buying a few intangible things. Like most condos are waterfront and you can’t get a house that’s waterfront for that same price. So I look at it too as your, I mean I know this is in my head, but it makes me feel better about it because, because I’m paying for the proximity to the water. I’m paying for the beach access. I’m, I’m also definitely paying for a swimming pool. I’m paying for, in some cases, other amenities like maybe an on site restaurant that’s, you know, the proximity to that or a little store that sells incidentals to, to my guests. So there’s those things that I would not have a single family that I just consider that the HOA is handling all of those things and hello, beach proximity.

Avery Carl [00:07:02]:
Yeah, 100%. I mean, we’ve got, at this condo, we’ve got three pools, we’ve got deeded beach access, the landscaping’s done. So these are all things. You know, I do have a single family with a private pool that we maintain. And I know it’s not terribly expensive, but it is a pain in the ass and I don’t have to deal with that here. And there’s three of them. And the deeded beach access versus public beach access is, it’s a different animal. It’s a little less crowded in cases.

Avery Carl [00:07:29]:
So you’re right, you’re, you would not be able to get a single family home on the beach for that. And even so, the insurance on properties that are like on the sand, a lot of times, Even if they’re $20 million properties, they’re not going to be insurable. Sometimes they are. I’m not saying none of them are, but they’re. The insurance on those is astronomical because they’re on that. They are the first thing that a hurricane is going to hit when it hits land, before it slows down at all. So a lot of times it’s actually just not even worth it. Numbers w investment wise to be on the sand.

Avery Carl [00:08:02]:
If you just are a millionaire billionaire and you want to be on the sand, great, that’s one thing. But typically we’re not seeing those as being investment properties. Not the $20 million ones anyway. So. I agree. It’s, it’s the best, most cost efficient way to be on the beach with a view of the water and have all these things.

January Johnson [00:08:22]:
Yeah. I want to say something else about assessments. So it’s not like you all of a sudden find out that you have an assessment next month. I mean, There is an 8. There is a homeowners association, there’s meetings, people have conversations there, there’s a vote, there’s discussion. I mean, this is, it’s, it’s a known thing that is coming. They don’t just spring it on you and say, oh, by the way, you owe us 20 grand next month. And also I always advise clients who are looking at buying condos to get the last year’s worth of the HOA meeting minutes and agendas so you can see what they’ve been discussing.

January Johnson [00:08:56]:
And you know, you’ll see what’s of concern to that building or to those people. You’ll see what might be coming up and that may or may not impact your decision to buy there. But it’s always good to do your due diligence on that.

Avery Carl [00:09:08]:
Yeah, well, I guess. So let’s talk about the one thing that it usually doesn’t cover and that’s electric. So most of the listeners here are going to be buying, I would say between a one and a three bedroom condo. Tim, what do you see for your electric? Usually on that size?

Tim Grillo [00:09:23]:
Pretty cheap. Tops. Tops. Tops like dead. The summer people are probably leaving the door open more often than they should. It gets up in the 175ish range. You know, middle of the winter, you’re down in the like 70 bucks, maybe less. I mean it, it’s not much, it’s.

Tim Grillo [00:09:37]:
And part of it is you’re, you’re kind of surrounded by other units, you know, so you’re somewhat, I’ll say insulated, you know, so it’s not, I didn’t.

Avery Carl [00:09:44]:
Even think about that.

Tim Grillo [00:09:45]:
It’s not like you’re, you know, you don’t have it really unless you’re on the top floor. It’s not really escaping out the roof or anything like that like it would be in a normal house.

January Johnson [00:09:52]:
So Yeah, I think 150amonth on average is a good safe bet. And yes, going to be higher, going to be lower, but 150. Yeah, I agree with, with Tim.

Avery Carl [00:10:01]:
Okay. Yeah. So it’s not a, not a huge expense in this market.

Tim Grillo [00:10:05]:
Yeah.

Avery Carl [00:10:05]:
Okay, so let’s talk about maintenance. So we’re right on the ocean and typically there are going to be some things that when it comes to properties that are exposed to salt air on a constant basis that we have to deal with maintenance wise pretty often. So what are some of those things?

Tim Grillo [00:10:23]:
Couple of my big ones are that and one is really different. Well two, both these are a little bit different because of the beach aspect. But H Vacs in a condo building, understand where your outside H Vac unit is, it can make a difference. It’s going to corrode faster than it would in a non beach market, period. One of mine is in an Area where it doesn’t get rained on, which sounds like a good thing but it’s actually not because the salt water sits on there and it corrodes on it. And so that, that you can either, you know pay somebody to go spray it off of the hose a few times a year, which is a good ide. But also plan on replacing it. You know something that would last in a non beach market would be like 15 years.

Tim Grillo [00:11:00]:
This may be like 5.

January Johnson [00:11:02]:
Are you responsible for that in a condo because it’s outside or just where you are?

Tim Grillo [00:11:06]:
Ours. Ours is. I am responsible for it. You know and I will say the H VAC companies there are very in tune with that. And it’s also for whatever reason not near as expensive as other markets to replace that, that, that part of the unit. So if I had to do it it not a huge deal. So that. And the door lock, you know and I’m talking specific to condos.

Tim Grillo [00:11:27]:
We’re talking about a house. There’s a lot more. But the door lock is going to take a beating. And that’s just something you have to kind of plan on replacing more often than you would in a normal place. But really anything outside that can corrode we. Exterior door. I mean this is just kind of more normal stuff. But exterior doors of condos I found get kind of beat up.

Tim Grillo [00:11:45]:
You know, people are coming in with suitcases and kids and you know all that kind of stuff and they get a little beat up. So we, we repaint ours once a year and then you know we have the metal plates on the bottom and all that kind of stuff.

January Johnson [00:11:54]:
So got to make sure you have the right furniture too. Don’t be putting the, the outdoor furniture from Home Depot that everybody thinks is outdoor furniture out there on the salt facing balcony. You want that good poly resin.

Avery Carl [00:12:07]:
Yeah.

January Johnson [00:12:07]:
And because. And things can blow around. So you want heavy and heavy duty and that, that resin stuff.

Tim Grillo [00:12:14]:
Absolutely agree. The outdoor stuff from any anywhere store you’re going to have rust rings all over your balcony and, and, and they’re gonna fall apart. So Hollywood is the way to go.

Avery Carl [00:12:24]:
100 and something else. So when it comes to single families, one of the big metal components that is outside that is going to be corroded on every single property that you look at is going to be the exterior of the H VAC unit. So the, you know, the big metal box thing I’ve had Parker Barofsky, she’ll let me say her name on here. Had the best deal. She did end up buying it. Best deal under contracts a few years ago. And she wanted to terminate it because there was corrosion on the exterior, like, encasement of the H vac. And I, like, had to shake her because I’m friends with her.

Avery Carl [00:12:59]:
I would never shake just anyone. But I had to, like, shake her and be like, you will buy this property. It was one, one tier back from the beach for like 700 in a very much more expensive market than that. It’s worth like $3 million now. So she’s happy I shook her. But my point was, don’t terminate a good deal because of corrosion because there’s going to be corrosion on everything. So don’t let a good deal go because of that, because you’re going to terminate that. And then on the very next one, there’s also going to be corrosion on the H VAC unit.

Avery Carl [00:13:31]:
So just keep that in mind. Anything metal that’s outside in a beach market will probably have some corrosion or some rust or something.

Tim Grillo [00:13:39]:
It can be scary for coming from, you know, if you’ve never been in a beach market, when you start looking at inspection reports and stuff, the corrosion can be scary, but it is. There is no. There’s no getting around it, really.

Avery Carl [00:13:50]:
So the Lord wants it to corrode. Okay. So anything else in terms of maintenance that we deal with a lot in a beach market like this because of salt, moisture, humidity, I would say, you.

January Johnson [00:14:02]:
Know, a lot of times owners of condos want to supply beach equipment for people. So beach chairs, portable beach chairs, beach wagons, those kind of things. Definitely. And Chuck Kramer will tell you this too. Definitely don’t get the ones with the wooden hand. The wooden armrests get the plastic. Don’t get the wooden armrests. But because you’ll have to replace them more frequently.

January Johnson [00:14:23]:
I mean, for the most part, I replace beach chairs every year, if not every other year. But, you know, if you’re going to supply things for people to take down on the sand with them, you want to be sure that you’re paying attention to the quality and the. And the. The upkeep of those items that you provide for people also.

Tim Grillo [00:14:39]:
Yeah, on that same note, I started to say it was sand. You. You’ll have some sand related maintenance issues along the way. I’d say the biggest thing on that is like a P trap and a shower. You know, over time, they’ll start to, you know, people come in. No matter how much you wash off at the beach, you end up with some sand in your condo, which is. It’s just part of it and not a Huge deal. But you know, from time to time you have to have a plumber come out and clean sand out of peach traps and stuff like that.

Tim Grillo [00:15:02]:
But it’s pretty, pretty simple and that’s not a huge expense. But it is, it is something that if you’re not used to it, it can catch you off guard a little bit.

Avery Carl [00:15:09]:
Yeah. Anything else related to sand that we have to worry about maintenance wise? Condo or single family don’t have carpet? Oh, yeah.

January Johnson [00:15:17]:
I mean, I’m astounded by how many condos I see that have carpet in them. And I mean, even if it’s nice carpet, I just feel like you can never get it clean enough. And I mean, throw a rug down maybe, but I would rather see tile or wood look tile or whatever. LVP in condos just because you’ve got moist moisture, you’ve got sand and it’s going to get down in that carpet. And I think it’s gross.

Avery Carl [00:15:38]:
Yeah, it is gross.

Tim Grillo [00:15:39]:
I feel that way about all carpet.

Avery Carl [00:15:41]:
Yeah, all carpet. We’re so the house that we live in is kind of like a live in flip. And our bedroom does have carpet, although it’s new. And there is like an invisible sand burr in one section of the carpet. I can never find it. I step on it often and it hurts a lot, but when I get down there, I can’t find it. And so sandbars are not, not something to be trifled with. They hurt so bad.

January Johnson [00:16:09]:
They’re like the Lego of the plant world.

Avery Carl [00:16:10]:
Oh my God, even worse. Like so bad. And I think about that like every. Can you imagine if, if I was a guest in this house and I keep. I’ve stepped on this sandbar at least 1000 times. I don’t know why it won’t crush, but I can’t find it. It doesn’t exist to my eyeballs, only to my feet. So anyway, there’s a lot of reasons not to have carpet.

Avery Carl [00:16:32]:
Sand, sandburst, it’s just gross. It looks dated. Like that’s something that will eventually, when we get to that level of the house, we’ve gone from bottom floor up will be replaced with LVP. You just got to. You’ve got to go LVP. No, no, carpet. Carpet is very up to like mid 2000s and back. All right, so anyway, off of that tangent, let’s see anything else maintenance wise, that’s specific to beach markets that we haven’t mentioned that might cost us some money? I think we touched on all of it.

January Johnson [00:16:58]:
Right, so okay then if you have a, a single family and you’ve got a pool. I mean that, but that’s usually, you know, you pay somebody to maintain that monthly and yeah, mostly that’s about 150 bucks a month or so.

Avery Carl [00:17:12]:
Yeah, that costs us about 150amonth. And we really don’t get. You don’t get many phone calls about, oh, the pool isn’t what I want it to be like. It’s, it’s usually fine. You do want to make sure if you buy a property that has a private pool, it has a pool heater. When we bought, we were like, eh, it’s the beach. We don’t need a pool heater. That’s absurd.

Avery Carl [00:17:29]:
But no, it, it really does. We ended up installing one. I think it costs about three grand to install a gas pool heater. It could be more depending on what, what you have to do and what the rules are. So definitely check with the city. You do have to get a permit to do something like that. So check with the city what they require, whether it’s gas, electric, what have you. But a pool heater really can extend your season a little bit and it will definitely bump that price per night.

Avery Carl [00:17:53]:
We actually charge 50 bucks a day for the pool heater during the off season, so it’s definitely something worth having. If you have a pool, just get the pool heater. It’ll pay for itself in one season.

January Johnson [00:18:03]:
Couple of degrees makes a big difference. 78 degree pool is not as fun as swimming in an 82 degree.

Tim Grillo [00:18:10]:
Ours is heated and people love it, especially in the winter.

January Johnson [00:18:13]:
Yeah, and really you’re only heating it in the winter. I mean, the rest of the time the sun’s doing the work for you. So.

Avery Carl [00:18:17]:
Yeah, yeah. I saw there’s a interior designer that I follow on TikTok and he did some list recently about like 10 luxury things to do to your house and one of them was to heat your pool to 98 degrees because that’s the exact same body temperature as you. So he’s, he was like, it’s just amazing. It’s what I do with my pool and I’ve never done it. But now every time I hear pool temperatures I think about, why did he say that? I think really hot.

January Johnson [00:18:42]:
Yeah, that seems too hot for swimming and not, not hot enough for hot tubbing.

Avery Carl [00:18:47]:
Yeah, I don’t know. I don’t know what, but I want to try it now because I’m like, why did he say that? That’s such a weird thing to suggest. Anyway, that’s not what this Podcast is about who I follow on TikTok. Okay, so let’s talk about cleaners really quick. So there’s a few things that you want to ask cleaners and we’re going to have an entire episode on this, so don’t. We’re not going to get too far in the weeds, but a couple of things you want to ask cleaners. In terms of cost, they will typically do things one of two ways. They’ll either provide, you know, your paper towels, toilet paper, all that consumable stuff and they’ll charge a little extra for that so you don’t have to worry about stocking it, or they will not do any of that and just let you know, hey, your paper towels are low.

Avery Carl [00:19:29]:
And then you Amazon it to them and it’s very market specific. So in some markets that I’m in, they want, they want you to Amazon it to them. And then other markets like actually that she’s not our cleaner anymore. The cleaner that used to clean this one got mad at us for sending her something to stock and was like, I’m not a property manager. And we’re like, okay, but you said we needed more of this. So what do you suggest? So what do you guys typically see cleaning cost wise and what do your.

Tim Grillo [00:19:56]:
Cleaners cover for one bedroom? I’m, I’m in the, I’m in the category of I love cleaners that provide everything in every market that I’m in. And we actually that’s something we look for because in the early days we didn’t do that. And it’s just, it’s just I found it’s a hassle that we don’t need and we’d rather outsource that. So that’s a personal decision. But our one bedrooms on the beach were about $120 a clean and that’s what them providing, providing everything.

January Johnson [00:20:21]:
So yeah, that’s about right. And I’m pleasantly surprised sometimes at, you know, going up. A bedroom and a bathroom is not like double necessarily. You know, it’s not 125 for a one bedroom and then, you know, 375 for a three bedroom. It really depends. But I’m also in the camp of please provide the items, you know, the little soaps and the whatever and, and my cleaners provide also trash bags and a couple of dishwasher tabs and some laundry tabs and things like that to.

Avery Carl [00:20:53]:
Get guests through as well.

January Johnson [00:20:54]:
So yeah, about 125 for one, but maybe 175 for a two bedroom. Ish, something like that.

Avery Carl [00:21:00]:
Okay.

Tim Grillo [00:21:00]:
I have found the beach markets tend to be a little bit more expensive than like, a mountain market. So if you’re in a mountain market, move to the beach, expect to pay a little bit more. It’s not exorbitant, but it is typically more.

January Johnson [00:21:10]:
So let me tell you, this is not something that you want to get the cheapest person for. Okay. I, I, when I started out, I started out being a Airbnb host nine years ago, and it was a very mom and pop organization kind of a thing. And none of my cleaners ever had smartphones back then. And so they would say, you know, guests did some kind of damage or whatever. And I would say, well, send me some pictures. And they would tell me they couldn’t because they didn’t have the phones. So I started out back in, you know, back in the day, back in my day, but now I would rather pay a little bit more for a cleaner.

January Johnson [00:21:40]:
I would rather pay more for a service, a cleaner that has a team of people, because if that one cleaner can’t be there and you’re stuck and you don’t live there, I mean, I’m not, I have property, and in the city where I live, and I’m not going over there to clean it. Okay. I would do a terrible job, first of all. But I consider that I’m a remote manager even for the property that is in my town. And it is much more important to me to pay a professional person with a professional equipment who can, who has the team that can get in there and get the job done and get out in the time that I need them to. So I have experimented with trying to get the best deal, and it is not the best deal. Just learn from me.

Tim Grillo [00:22:15]:
Completely agree with that. Sometimes if you have to actually charge less cleaning fee than what you’re paying, it can actually be worth it. You don’t want to go crazy with that. But I couldn’t agree with what January said more, so.

Avery Carl [00:22:26]:
All right. Yeah, I totally agree with that. Cleaners are not the place to try and pinch pennies. You, you need a good. You should pay your cleaner extra for doing a good job because you can’t do it without them.

January Johnson [00:22:36]:
Yeah, I give, like, random tips. And I mean, I don’t tip every turn. Give random, like, oh, my gosh, we got a great review, or I definitely give a Christmas bonus. And then sometimes just in the middle of the season, if they’ve gone above and beyond for me on something, you know, they don’t. My cleaners don’t Necessarily charge me for every little thing. Sometimes I’ll say, oh, I noticed this and I fixed this for you, you know, and I’ll just throw them some extra money because it, it’s in my best interest, 100%.

Avery Carl [00:23:02]:
All right, so let’s talk about taxes in this market. So you guys, what, what have you found for taxes?

Tim Grillo [00:23:09]:
So most vacation rentals are going to have, you know, some sort of an occupancy tax. And Myrtle beach is no different than that. So, you know, I don’t live there. And Jan, I know you’re January, I’m, I know you’re right in the middle of buying there, so you might be able to talk on this better. But roughly, you’re looking roughly 12% on your occupancy tax. There are some great websites out there that you can go to. There’s actually explore myrtlebeach.com that has a lot of information about the tax structure there. They have a, it’s a little bit different than some of the other markets that I’m more familiar with because they actually do like different tax brackets for lodging, food, you know, different things like that.

Tim Grillo [00:23:47]:
So it’s all spelled out on there. And then also the county website has, has good information too. So.

January Johnson [00:23:53]:
Yeah. And I think this is something that, that even I have found, even some of my clients later, after the fact, they’ve been, they’ve been renting for six months as a, as a host and, and they’re like, they call me, I’m supposed to be paying some kind of occupancy tax. And I’m like, yes, you are. You know, I mean, the, the online travel agencies, Airbnb and vrbo, they will pay the state tax for you, but they do not pay in most cases. And again, this varies by, by short term rental market, but they mostly don’t pay the county or the city tax.

Avery Carl [00:24:29]:
So.

January Johnson [00:24:29]:
And those things change all the time. And you would not expect Airbnb and VRBO to keep up with every single state and municipal tax for occupancy for the different kinds of things. That really is your responsibility as, as a owner and a host to know what those taxes are and when they’re due. And they’re typically due monthly and in, by the 20th or the 15th of the month for the month prior. And you can go online and file them, but definitely expect that you will be paying county and city taxes. And, you know, a lot of those tax monies go for infrastructure that brings more guests to you. So I think paying occupancy tax is it’s I don’t want to call it a privilege because it’s not like I’m so excited about paying taxes. But what they do for me as a host is very much worth it.

January Johnson [00:25:17]:
And, and I believe in paying those taxes because I want there to be nice sports parks and nice roads and nice amenities in the city that’s not going to be like, oh, we don’t go to Myrtle beach anymore because you know, it’s so yucky. No, the, you know, Myrtle beach uses that money to pay for things that help your, help you in the end indirectly.

Tim Grillo [00:25:37]:
It is my favorite tax to pay on that.

January Johnson [00:25:40]:
It’s a high quality problem to have a tax.

Tim Grillo [00:25:41]:
It is, it is. And actually that’s a little bit, I don’t want to quite say part of my strategy with like looking at markets, but if I’m looking at a market and there isn’t an occupancy tax or something like that, that would worry me because that means that they’re not a tourism based, you know, market. So a couple things on that that January went through, you know, the paying monthly and figuring out and everything that can be a little bit confusing and overwhelming when you’re new. The websites I mentioned earlier, the, the explore myrtlebeach.com and the county website, one of those two has got a really nice flowchart on it that kind of lays out like here’s how you, you know how and when you file your permit and then all the things that happen after that. Also there are some third party providers out there that will help you with this. A really Popular one is mylodgetax.com and they’re, they’re not specific to any one market but they’re a service that, that does this and you can sign up with them and they’ll go as far as you can pay them a pretty nominal fee and they will get your permits and stuff for you and they will also they provide like a one stop shop for paying all of your, your, your taxes. So I have used that and it is a nice thing especially when you’re starting out if you’re overwhelmed and don time to dig into all the little intricacies there and then you can sign up for them. At the end of the day it is still your responsibility, you know, so if like they do something wrong it’s, it’s your responsibility, it’s your taxes.

Tim Grillo [00:27:05]:
But I found them to be super useful especially in the beginning and then you know, if you get a year under your belt or whatever and want to, you know, go Sign up on all the websites and do it yourself. No big deal.

Avery Carl [00:27:14]:
Yeah, that’s a great resource that my lodge tax is awesome. So I don’t think that, oh, property taxes.

January Johnson [00:27:20]:
Taxes in Myrtle beach are a little bit higher for second homes than they are for regular. So don’t get that confused. And I always like to tell people who are buying property anywhere not to, you know, when you get the cost to own from the current owner, do not assume that their insurance is going to be the same as yours or their taxes are going to be the same as yours. So a lot of times people who are new at this make the mistake of taking those numbers and saying, oh well, taxes on this house are, you know, fifteen hundred dollars a year. Okay, well they were for this person who bought it 10 years ago and it has gone up over time for them. But you’re going to have a new market value or new assessed value and they’re going to calculate taxes based on that. Although I do know that South Carolina taxes are on the average lower than a lot of other states, but they are a little bit higher for second homeowners, for vacation property owners other than primary residents.

Tim Grillo [00:28:13]:
Yeah, exactly what January just said. There, there’s, I think it’s, they call it 4 and 6% but anytime you’re looking at property taxes, look at get on again, jump on the county, you’re looking at website because there’s usually some kind of. It’s not like you’re buying a million dollar house. It’s not just $1 million times 6%. It’s, there’s, there’s a calculation and they have one. It’s something crazy like you take the assessed value divided by a thousand times two hundred and some times the rate.

January Johnson [00:28:39]:
So it ends up being around 0.7% of the purchase price. So that’s a lot lower than, than where I have most of my property in Florida, which is a little bit over 1% of the purchase price. But we don’t have a personal state income tax in Florida. South Carolina does have a personal state income tax as far as I know. And so you know, they’re going to get their taxes one way or the other. But the property taxes are not super high. But they are different for vacation home than primary.

Avery Carl [00:29:05]:
All right, good to remember all of that stuff. Always make sure guys that what when it comes to taxes that you have to pay, whether it’s property taxes or sales tax or occupancy tax, any of that that you are call the city or county directly, depending on where you Are, don’t rely on your agent or your property manager or whoever. Things can get lost in translation. Even if you have like the smartest, most on it person calling for you, things can still get lost in translation. So always make those phone calls yourself and don’t rely on other people to do that because you’re going to be the one that’s in trouble if your stuff isn’t done right, not them. So.

January Johnson [00:29:41]:
And people are very helpful. I mean, I always encourage people to call the county, call the city, call whoever it is that’s responsible. Responsible. There are human beings there. They do want to help you pay your taxes. They are very helpful. And in some cases, you know, like I had a client recently who just like I said, he was like, what? I’m supposed to be paying these taxes? Well, when he called and, and said, you know, sorry, sorry, sorry, they waived a lot of fees for him because they knew he was trying to get it straightened out. So they’re not just, you know, mean, faceless government people.

January Johnson [00:30:12]:
They definitely want to help you. And they, they want to help. They want to help them themselves as the city, but they want to help you as the owner. Get straight with that. So definitely call personally.

Tim Grillo [00:30:19]:
Again, not that I love dealing with taxes, but another thing I love about some of these sleepy vacation towns is these offices aren’t huge. And you start calling you, you’re pretty likely to get the same person more than once and you can actually start to have a little bit of a relationship. So it’s kind of cool. Again, it’s not like you’re calling a Chicago tax office, you know, so totally Chicago tax office. I don’t know where that came from. I just made that up.

January Johnson [00:30:46]:
Property appraiser’s office one time and went down. Oh, come on down. We’ll run you a list of that, you know, and okay, sure. We’ll teach you how to do this. Come on over here. I’ll, you know, I’ll meet with you after lunch or whatever.

Avery Carl [00:30:58]:
That’s nice. It’s not like that everywhere.

January Johnson [00:31:00]:
Hashtag small town life.

Avery Carl [00:31:01]:
Yeah. All right, guys, well, thank you so much for coming on and helping us talk through this, guys. If you’re ready to buy with us in the Myrtle beach market, you can email us at agents the shorttermshop.com or you can just, if you’re not ready to do that yet, you just want to hang out, talk about short term rentals, you can join our Facebook group. It’s called Short term Rental, Long Term Wealth. Same title as my book. There right behind me. Or we have a live Q and A every Thursday where you can ask us all of your burning questions about short term rentals. And you can join that@strquestions.com thanks guys.

January Johnson [00:31:31]:
Thanks SA.