The Myrtle Beach Area Chamber of Commerce (MBACC) and Convention and Visitors Bureau (CVB) provided its expectations report for Grand Strand tourism in 2023.
“We see good things for the travel sector across the nation and we have no reason to expect any different in Myrtle Beach. The destination is going to have a good year next year as well,” said Tourism Economics’ Geoff Lacher during a recent online presentation hosted by MBACC and CVB.
According to a report by Travel Daily News, Myrtle Beach is expected to experience visitation numbers similar to 2022, yet, at a slightly slower pace due to an expected downturn in the economy during the first half of 2023.
Lacher pointed to several factors propelling tourism forward, including the continued pent-up demand for travel following the pandemic, increased gains seen in the business and group travel sectors, declining gas prices, fiscally strong households and businesses, and a strong momentum for travel heading into the new year.
The Myrtle Beach Area Chamber receives over $51 million in tax corporate welfare annually to promote the city.
Underlining the current demand for the destination, Myrtle Beach recently made Tripadvisor’s list of “Top 10 Trending Winter Destinations for U.S. Travelers.”
Myrtle Beach tourism generates approximately $3 billion annually in revenues across the Grand Strand.
THE REAL ESTATE INDUSTRY
A large majority of the Myrtle Beach Area Chamber’s members are property managers and real estate considerations.
Real Estate generates a $38 billion annual impact on Horry County. Real Estate is the area’s #1 industry by a huge margin. How will rising interest rates affect those numbers?
“By the end of 2023, financial market participants expect that the Fed will have increased the target Fed funds rate by 175 to 200 basis points from current levels. That would translate into 30-year and 15-year mortgage rates at roughly 8.50 and 7.70 percent,” says Robert Johnson, a professor of finance at Creighton University’s Heider College of Business.
While the chamber rarely speaks of matters outside of tourism, this “not for profit” is tightly aligned with local realtors.
Low housing inventory has been a challenge since the 2008 housing crash when the construction of new homes plummeted. It has never fully recovered.
Housing supply that remains near historic lows has held up demand compared to other downturns, consequently sustaining higher home prices.
“Inventory levels are still tight, which is why some homes for sale are still receiving multiple offers,” Lawrence Yun, NAR’s chief economist said.
At the current sales pace, inventory is at a 3.3-month supply, according to the National Association of Realtors.
“[This] is about half of what we’d like to see normally,” says Rick Sharga, executive vice president of market intelligence at ATTOM Data. “And we still have pent-up demands based on demographic trends.”
Housing inventory is up slightly from 3.1 months in September and 2.4 months a year ago, according to NAR.
WILL DOWNTOWN REDEVELOPMENT AFFECT TOURISM?
The City of Myrtle Beach is in the middle of a redevelopment downtown that will change traffic patterns and close roads over the next 3 years. How these changes affect tourism is yet to be determined. However, over the past 5 years, tourists preferred the destinations of Surfside Beach, The City of North Myrtle Beach, Garden City Beach, and Pawleys Island above the City of Myrtle Beach itself.
WILL THE HOUSING MARKET AFFECT TOURISM?
The flight of northern residents who chose to live in Carolina Forest, Market Common and other areas over the past 5 years advanced by roughly 24% every year. With rising interest rates, will this pattern continue?
The unknowns about 2023 appear to be greater than what can be known at this time.
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