Airbnb market analysis and investment insights
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Folly Beach, SC — Market Intelligence Report
Researched by Chalet's Senior STR Analysts · Verified with local Folly Beach market partners
Folly Beach, South Carolina, stands out as a tightly held, high-barrier short-term rental market defined by its strict cap on STR licenses and robust full-time operator performance. Over the past year, active full-time operators have averaged $70,807 in annual revenue (Chalet data), a figure that sets the pace for serious investors despite a broader whole-market median of $86,899—an apparent paradox explained by the dilution from a large part-time and casual host base. The market’s median occupancy sits at 60%, with an ADR of $486 and a median gross yield of 8.61% against a median home value of $1,009,266. Folly Beach ranks #222 nationally for STR performance. Seasonality is pronounced: July peaks at $9,387 in monthly revenue and 81% occupancy, while January plunges to $4,046 and 23% occupancy—a near 2.3x swing between high and low seasons.
Investment performance in Folly Beach is stratified by bedroom count, with larger homes capturing outsized returns. Four-bedroom properties, comprising 19% of supply, average $108,506 in annual revenue at an $809 ADR and 52% occupancy—a clear step up from the 3BR segment, which averages $66,735 at $491 ADR. The 5BR and 6BR tiers, though smaller in supply, sustain high average revenues of $129,942 and $151,632, respectively, with ADRs above $1,000. Investors looking for scale and yield in this market should focus on these mid- to large-format homes, where both nightly rates and annualized returns are meaningfully higher. For tailored acquisition strategies and on-the-ground insight, connect with a Chalet agent.
Geographically, nearly all investable inventory clusters in zip code 29439, which hosts 630 listings with a median annual revenue of $87,034, 60% occupancy, and an 8.2% yield on a $1,060,636 median home value. This concentration underscores the scarcity value of licensed inventory and the importance of precise asset selection. Investors should note that while 1BR and 2BR units are accessible and comprise a third of the market, their average revenues ($40,625 and $50,038, respectively) and occupancy rates lag meaningfully behind larger homes, reinforcing the premium on scale in this market.
At scale, Folly Beach rewards operators who can navigate both regulatory complexity and seasonality. The guest base is overwhelmingly regional, with Charlotte, Asheville, Charleston, and other Southeastern cities dominating origin markets—international guests account for less than 1%. Booking lead times average 64 days, with a median stay of 4.8 nights, indicating a blend of planned leisure and family travel. The market’s top hosts—Carolina One, MyOceanRental, and The Best Rentals—control a majority of supply, leveraging operational scale and local expertise. For investors modeling returns or evaluating acquisition fit, the Chalet ROI calculator is essential for scenario planning.
Risks are concentrated and material. Over the past year, revenue per listing surged by 24.7%, but this came alongside a 2.9% decline in occupancy and a 1.3% uptick in listing supply. Most notably, median home values fell by 3.6%, reflecting either softening demand for ownership or regulatory headwinds. The seasonal trough in January is severe, with occupancy dropping to 23%. Regulation is the defining constraint: Folly Beach enforces a hard cap of 800 STR licenses (currently maxed out), a non-transferability rule on sale, and significant compliance costs. New investors face a waitlist and high barriers to entry—see the Folly Beach STR regulations for the latest policy landscape.
Folly Beach is a classic scarcity market where outsized returns accrue to well-capitalized, operationally sophisticated investors who can secure a license and scale into larger homes—provided they can navigate the regulatory gauntlet and withstand deep seasonality.
Get matched with top Folly Beach, SC lenders who specialize in short-term rental financing — they understand STR underwriting and offer competitive rates for investment properties.
