Myrtle Beach’s rental vacancies 4x higher than national average. Are luxury rentals to blame?
Luxury apartments have exploded in the Myrtle Beach area over the past five years.
However, many of those are showing a high vacancy rate, which raises the question of whether Myrtle Beach has become over-saturated with these types of units.
The high rate of population growth has caused a housing boom across Horry County, with single-family homes, town homes and luxury apartments erected.
Luxury apartments are defined as having high-end appliances and finishes, as well as amenities like a pool or valet trash service, according to Apartments.com. Rent for luxury apartments can range from $1,400 a month and higher.
“I don’t necessarily think there’s ever really oversupply. I think more supply is good, right, if anything, because at the end of the day, it’s going to drive competition within these buildings,” said Spencer Correnti, the CEO of Alkaline Advisors.
If people aren’t renting apartments, it forces companies to lower prices to meet demand, Correnti said. But prices can only go so low, as owners still need to pay the mortgage and overhead costs.
The increase in luxury apartments has caused a drop in affordable rental housing as more of the units are being built.
Currently, there are a handful of apartments in the Myrtle Beach area with a high vacancy rate. Apartment complexes typically want a vacancy rate of 7% or lower, said Carol Hall, the lead housing voucher choice specialist with the Housing Authority of Myrtle Beach
Census data shows Myrtle Beach has a 22% rental vacancy rate and North Myrtle Beach has a 71% rate. The national average is 5.5%. These numbers may be attributed to the Myrtle Beach area’s high number of short-term rentals, said North Myrtle Beach spokeswoman Lauren Jessie in an email to The Sun News.
The Sun News calculated various apartment vacancy rates using data from Apartments.com and the number of available units listed on apartment websites.
Apartment complexes with high vacancy rates as of Feb. 6 include the Hawthorne at the Mill, which has 12% vacancy and the Willows at Grande Dunes with 10% vacancy. There are also apartments, such as the Luxe at Market Common, that are currently below a 7% vacancy rate.
The Sun News reached out to these apartment complexes’ property managers, but they did not respond before publication.
More luxury apartments are also being built. The Landing at Coventry is currently under construction near the Market Common Publix. Rent starts at $1,750 for a studio apartment.
There is also a proposal for over 1,800 apartment units to be built in Carolina Forest, although rent costs have not been released, The Sun News reported.
A shortfall of affordable housing
While it’s unclear if there’s an oversupply of luxury apartments, statistics show there’s a definite lack of affordable rental units in the Myrtle Beach area.
In 2023, over 57% of renters in Myrtle Beach were housing cost burdened, according to Census data. This means people spend more than a third of their income on rent. That’s an 11 point increase since 2018.
Despite the surge in housing units, Hall said she has seen very few units built for a working class salary.
Since 2020, Hall has seen rent prices soar. Five years ago, a Myrtle Beach Housing Authority housing voucher would pay up to $893 for rent and utilities at a studio apartment. But in 2024, a voucher could go up to $1,400. The amount went up because it has become challenging to find cheaper apartments.
“We can’t go over the dollar amount given by HUD, so we have to limit the number of vouchers on the street,” Hall said.
Rent inflated faster than the housing authority’s Department of Housing and Urban Development budget, meaning the organization has to offer fewer vouchers.
While the price in rent can be attributed to the kinds of housing being built, there are also outside factors, such as the rise in lumber costs.
“Even if you’re building a pretty straightforward building, costs have risen so much that at a certain point, without subsidies, a developer can’t make a profit,” Correnti said. “That’s another reason why everything’s so expensive.”
