Fort Mill, SC, August 27, 2025
News Summary
Short-term rental owners in Fort Mill, SC, are struggling with rising operational costs, particularly due to increasing insurance rates and property taxes. Homeowners are finding it difficult to remain profitable, with many reporting losses since the pandemic began. Dynamic pricing strategies are being employed to drive bookings, but overall financial strain is significant. Local government regulations are in flux as property values surge, raising concerns about the future of rental operations amidst these economic challenges.
Fort Mill, SC Faces Challenges in Short-Term Rental Market Amid Rising Costs
Short-term rental owners in Fort Mill, SC, are grappling with a significant increase in operational expenses, primarily due to soaring insurance rates and property taxes. These financial pressures have made it increasingly challenging for homeowners to maintain profitability, with many reporting losses since the start of the pandemic.
Rachel Amodio, who purchased her property at Coligny Beach in 2023, experienced losses during her first year of operation, largely due to high maintenance costs and a static pricing model from her property management company. In November 2024, Amodio shifted to managing the property herself, implementing a dynamic pricing strategy, and redesigning the interior to attract more bookings. She is now focusing on retaining repeat customers and hopes to generate positive cash flow as she prepares for the upcoming summer season.
Dynamic pricing allows property owners to adjust rental rates based on demand, lowering prices as the booking date nears to encourage reservations. Despite these efforts, Amodio is not alone in facing financial hurdles. A growing number of short-term rental owners across the country have reported losing money, attributing their struggles to rising homeowner insurance rates that have doubled since the pandemic began. Nationwide, homeowner insurance rates have surged by 24% from 2021 to 2024, with premiums on the rise in 95% of U.S. zip codes, largely due to increased material and labor costs, frequent natural disasters, and an unregulated global reinsurance market.
Another homeowner, Suzanne D’Amico from Georgia, has seen her insurance costs double over the past four years. Her rental property has remained unprofitable since the pandemic, managing only one profitable month during that period. In Fort Mill, property taxes for short-term rentals are notably higher than those for owner-occupied residences, further exacerbating financial strain. In Beaufort County, owner-occupied homes are taxed at a rate of 4%, while short-term rentals are subject to a 6% tax, along with other state and local taxes that can total around 10%.
As Fort Mill residents navigate these challenges, the local government is still finalizing regulations regarding short-term rentals. This comes amid a significant increase in property values in Hilton Head, which have risen by approximately 80% since the pandemic due to remote work trends. Many property owners view their rentals as key investments, with the potential for personal use in the future. However, local economists suggest that further significant increases in property values like those seen since the pandemic are unlikely.
Concerns over short-term rentals are not limited to Fort Mill. In nearby Rock Hill, discussions have emerged regarding whether such rentals should continue to operate in residential areas. The city planning commission recently voted against proposed changes that would restrict short-term rentals to commercial zones. Since 2017, Rock Hill has been studying short-term rental regulations, establishing rules for permits and inspections in 2020. Proposed changes would simplify the application process and eliminate caps on rental sites, yet mixed public sentiment persists regarding the presence of rentals in residential neighborhoods. The city council will need to vote on any proposed changes twice to enact them.
Despite these challenges, there has been little evidence of complaints or issues with the current short-term rental regulations in Rock Hill, as the community continues to weigh the economic benefits against potential local disturbances.
FAQ Section
What are the main challenges facing short-term rental owners in Fort Mill, SC?
Short-term rental owners in Fort Mill are experiencing rising insurance rates, increased property taxes, and high maintenance costs, leading to financial losses.
How have property insurance rates changed recently?
Homeowner insurance rates have increased by 24% nationwide from 2021 to 2024, with many homeowners experiencing double the cost of their insurance since the pandemic.
What is dynamic pricing in short-term rentals?
Dynamic pricing is a strategy that allows rental owners to adjust rates based on demand, often lowering prices as the booking date approaches to maximize occupancy.
How do property taxes for short-term rentals compare to owner-occupied residences in Hilton Head?
In Hilton Head, short-term rentals are taxed at a rate of 6%, while owner-occupied homes are taxed at only 4%, along with additional state and local taxes that can total around 10%.
What is the current status of regulations for short-term rentals in Rock Hill?
Rock Hill is in the process of reviewing short-term rental regulations, with the planning commission opposing changes to restrict them to commercial zones. Proposed regulatory updates aim to simplify the application process.
Key Features of the Short-Term Rental Market
| Feature | Details |
|---|---|
| Increase in Insurance Rates | Homeowner insurance rates increased by 24% from 2021 to 2024; some rates have doubled. |
| Higher Taxes | Short-term rentals in Hilton Head face a 6% tax, compared to 4% for owner-occupied homes. |
| Dynamic Pricing | Allows rental owners to adjust prices based on demand, lowering rates as booking dates approach. |
| Property Value Appreciation | Property values in Hilton Head have risen approximately 80% since the pandemic. |
| Regulatory Landscape | Rock Hill is reviewing regulations to potentially simplify the application process for rentals. |
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Additional Resources
- Island Packet: Fort Mill, SC Faces Challenges in Short-Term Rental Market
- Herald Online: Rising Costs Challenge Short-Term Rentals
- WSAV: Port Royal Caps Short-Term Rentals
- Charleston Business: Southern Breakfast Chain Enters SC Market
- Google Search: Short-Term Rental Market Challenges
Author: STAFF HERE HILTON HEAD
The HILTON HEAD STAFF WRITER represents the experienced team at HEREHiltonHead.com, your go-to source for actionable local news and information in Hilton Head Island, Beaufort County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the RBC Heritage golf tournament, Hilton Head Island Wine & Food Festival, and the Gullah Celebration. Our coverage extends to key organizations like the Hilton Head Island-Bluffton Chamber of Commerce and Community Foundation of the Lowcountry, plus leading businesses in tourism and hospitality that power the local economy such as Sea Pines Resort and Sonesta Resort Hilton Head Island. As part of the broader HERE network, including HEREAiken.com, HEREBeaufort.com, HEREChapin.com, HERECharleston.com, HEREClinton.com, HEREColumbia.com, HEREGeorgetown.com, HEREGreenwood.com, HEREGreenville.com, HEREHiltonHead.com, HEREIrmo.com, HEREMyrtleBeach.com, HERENewberry.com, HERERockHill.com, and HERESpartanburg.com, we provide comprehensive, credible insights into South Carolina's dynamic landscape.
