Folly Beach Short Term Rental Rules: A Buyer’s Guide

Shopping for a Folly Beach getaway you can rent when you are not in town? Short-term rentals can help offset costs, but the rules here are detailed and can change. You want a clean, confident path to purchase so you do not inherit surprises after closing. In this guide, you will learn the permits, taxes, zoning, and HOA steps to confirm, plus a buyer checklist to use before you make an offer. Let’s dive in.

How STRs work on Folly Beach

Short-term rentals are regulated at multiple levels. The city sets the local framework, the state governs sales and accommodations taxes, and your HOA or condo documents can add additional limits. Your goal is to confirm that your specific property, in its specific zone and community, can legally and practically operate as a short-term rental.

Permits and business licensing

Most coastal municipalities require you to register your rental and hold a local business license. Expect to display a registration or license number on your advertisements. Cities also commonly require a local contact who can respond to issues. Before you buy, confirm with Folly Beach staff whether a current license exists for the property, if it is in good standing, and whether you can transfer it or must apply anew.

Taxes you must collect

Short-term rental income is typically subject to state sales tax and local accommodations or hospitality taxes. You are usually required to register with the South Carolina Department of Revenue and remit taxes on a regular schedule. Ask the seller for proof of prior registrations and filings, and confirm the current tax rates and filing frequency directly with the state and the city before you finalize your numbers.

Safety, occupancy, parking, and noise

City codes often require basic life-safety features and compliance checks. Common items include smoke and carbon monoxide detectors, proper egress, and fire extinguishers. Local rules also tend to set maximum overnight occupancy, off-street parking minimums, and quiet hours or noise standards. Plan to verify each requirement with the city and measure your property’s real capacity against those standards.

Zoning and property-type checks

Zoning determines whether short-term rental is permitted, limited, or prohibited. On Folly Beach, the mix of single-family areas, multifamily buildings, and commercial corridors means your due diligence should start with the parcel’s exact zoning and then layer in any community rules.

Single-family areas

In residential zones, short-term rental use may be allowed outright, allowed with registration, or limited by conditions. Ask the listing agent for the exact zoning designation and confirm with Planning and Zoning staff whether short-term rental is a permitted use today, and whether any caps or moratoria affect new licenses.

Condos and HOAs

Condominium declarations and HOA covenants can be more restrictive than city rules. Many associations set minimum lease terms, limit the number of rentals, require operator approval, or mandate additional registration. Always obtain the full governing documents and the most recent board meeting minutes that mention rentals. If an HOA approval is required, make that a clear contingency.

Commercial and mixed-use corridors

Properties near Center Street or other commercial corridors may be treated differently. Some areas are more permissive for transient lodging, while others may require additional permits. Clarify whether a property is considered short-term rental, lodging, or another use type, and confirm any parking or signage standards that apply.

Flood and coastal risk

Folly Beach properties often sit in FEMA flood zones. That affects insurance, financing, and long-term operating costs. Ask for the property’s flood elevation certificate and review flood insurance options early. Higher deductibles, coverage limits, and premiums can shift your rental income projections, so build conservative assumptions.

Common restrictions and trends to verify

Regulations evolve as beach communities balance visitor demand with residential life. Use this list to focus your verification with city staff and your attorney.

• Caps or moratoria on new permits: Many resort towns limit new short-term rental licenses in certain zones. Confirm if any caps or temporary moratoria are active or being considered.
• Minimum stay rules: Some cities set a minimum number of nights. Ask how the city defines short-term rental and whether a minimum stay applies in your zone.
• Maximum occupancy and parking: Occupancy is often tied to bedroom count or square footage, and off-street parking may be required per bedroom. Validate both against your floor plan and lot.
• Advertising and contact requirements: Many cities require you to display your license number in ads and list a responsible contact. Confirm the current rule and display format.
• Noise and complaint protocols: Island municipalities usually enforce quiet hours and respond quickly to noise complaints. Ask how enforcement works and what penalties apply to repeat violations.
• Insurance expectations: Your lender and insurer may require specific endorsements for short-term rental use. Coastal location plus rental activity can increase costs, so get quotes early.

Due diligence checklist before you offer

Use this step-by-step list to protect your position and keep the contract on track.

1. Verify municipal permissibility

• Confirm the parcel’s zoning designation with Planning and Zoning.
• Ask if short-term rental is allowed today in that zone and whether any caps or moratoria apply.
• Check if the property has a current short-term rental registration and business license, and whether either can transfer.

2. Request seller documents

• Copies of the current short-term rental registration and business license, if any.
• The last 12-24 months of rental performance: gross rents, occupancy, platform fees, management fees, and major expenses.
• Any records of code violations or noise, parking, or occupancy complaints.
• Full HOA or condo declarations, bylaws, rules, and recent board minutes discussing rentals.
• Insurance policies and any claims history.

3. Confirm tax and remittance responsibilities

• Seller’s South Carolina Department of Revenue registration for accommodations and sales tax, if registered.
• Proof of timely remittance and the current filing schedule.
• Any local accommodations or hospitality tax registrations and filing cadence.

4. Inspect for safety and coastal resilience

• If the city requires life-safety inspection, obtain the report; otherwise consider an independent safety check for detectors, egress, handrails, and extinguishers.
• Flood elevation certificate, foundation condition, and any recent structural or roof updates.

5. Validate operations

• Off-street parking capacity relative to likely guest counts and city or HOA standards.
• Trash and recycling capacity and pickup schedules suitable for higher turnover.
• Utility setups and any restrictions on short-term guest use.

6. Model conservative financials

• Seasonality: strong summer demand and softer shoulder months.
• Management: 20-30 percent for full-service is common.
• Cleaning, linens, platform fees, taxes, utilities, and HOA assessments.
• Insurance: coastal homeowners plus flood coverage, with appropriate endorsements for rentals.
• Reserves for salt-air wear, exterior painting, decking, and systems.

7. Protect your contract

• Add contingencies for zoning verification, permitting or license transfer, HOA approval, and resolution of any open code issues.
• Consider escrow holdbacks to cover uncompleted safety fixes or permit steps.

8. Line up your team

• Planning and zoning staff to confirm current rules and any pending changes.
• A real estate attorney experienced in coastal and rental regulations.
• A CPA or tax advisor for registrations and filings.
• An insurance broker who knows coastal and short-term rental coverage.
• A local property manager to validate realistic nightly rates and occupancy.

Financial modeling for Folly Beach

A realistic pro forma is your best protection. Build a base case, a conservative case, and a downside case. Then test how each scenario holds up if your costs run higher or your occupancy runs lower.

• Revenue: Use local manager input for peak, shoulder, and off-season rates and occupancy. Be careful with owner-use days and blackout dates if any rules apply.
• Expenses: Include management fees, cleanings, linens, landscaping, pest control, utilities, internet, streaming, trash service, HOA dues, and supplies.
• Taxes and fees: Add sales and accommodations taxes and any local fees, plus licensing or renewal costs.
• Insurance: Price homeowners, wind, and flood policies, and add endorsements for rental operations if required.
• Capital reserves: Plan for exterior paint, decking, window and door maintenance, HVAC, and appliance replacement on a beach timeline.

Contract tips that prevent surprises

Clear language saves time and protects your investment. Consider these inclusions with your attorney’s guidance:

• Permit and license contingency: Purchase is contingent on verifying that short-term rental is allowed and that registration or licensing can be obtained or transferred.
• HOA approval: If the association must approve operators or usage, require written approval within a set time.
• Compliance representations: Seller represents no outstanding violations, fines, or unresolved complaints.
• Document delivery timeline: Set deadlines for all rental, tax, insurance, and HOA documents.
• Escrow holdback: Funds reserved to complete safety items or permit steps identified during due diligence.

What to expect once you own

Operating a short-term rental is an ongoing process. Plan for renewals, inspections, and guest communication systems that prevent problems before they start.

• Renewals and filings: Put license, registration, and tax filing dates on a shared calendar.
• Guest rules: Post clear house rules for parking, quiet hours, occupancy, and trash.
• Neighborhood relations: Provide a local contact number for quick response to concerns.
• Maintenance cadence: Schedule quarterly safety checks for detectors, extinguishers, and egress, plus semiannual exterior checks for coastal wear.

How a local advisor helps

You can move faster and avoid missteps with a guide who knows the island’s nuances. From pulling the right zoning documents to coordinating inspections, a local expert can keep your offer competitive while protecting your ability to rent. If you want seasoned, hands-on help from a lifelong Charlestonian with deep experience across the barrier islands, let’s talk.

Ready to explore Folly Beach options and build a confident plan for short-term rental use? Connect with Stephanie Wilson-Hartzog to discuss your goals and next steps.

FAQs

What permits do I need to run a short-term rental on Folly Beach?

• Expect a city short-term rental registration or business license, plus state tax registrations; confirm current forms, fees, and transfer rules with city staff and the South Carolina Department of Revenue.

Are short-term rental licenses transferable when I buy a property?

• Some licenses are not transferable; verify whether the current registration can transfer or if you must apply for a new one before you remove contingencies.

How do HOA or condo rules affect Folly Beach rentals?

• Association documents can prohibit or limit short-term rentals even if the city allows them, so review declarations, bylaws, rules, and recent board minutes before you offer.

Do I have to collect and remit lodging taxes for short stays?

• Yes, short-term lodging is typically subject to state sales tax and local accommodations or hospitality taxes, and you must register and file with the South Carolina Department of Revenue and applicable local offices.

How many guests can I host and how much parking do I need?

• Maximum occupancy and parking minimums are commonly set by local code and can be tied to bedrooms or square footage; verify the current standards for your parcel with the city.

Can I advertise a Folly Beach rental before I have a license number?

• Many municipalities require your registration or license number in advertisements; confirm Folly Beach’s current advertising rule and display format before you list.

What coastal risks should I price into my STR budget?

• Plan for flood zone implications, higher wind and flood insurance, salt-air wear on exteriors, and more frequent maintenance cycles that affect long-term operating costs.