Folly Beach, Isle of Palms & Mount Pleasant: A 2026 STR Cap & Regulation Guide

Thomas Garner
6 days ago
9 min read

Updated: 6 days ago

Charleston-area STR rules are a patchwork. Folly Beach carries an 800-license hard cap. Isle of Palms rejected a proposed cap. Mount Pleasant holds a 400-permit limit with 2026 renewals closed. Sullivan's Island enforces a 28-night minimum. North Charleston adopted a 60-per-district cap. Gated islands on Kiawah and Seabrook layer their own ordinances on top of county tax stacks. This consolidated guide maps out caps, permit tiers, taxes, and entry feasibility in a single reference for hosts and buyers who need jurisdiction-accurate answers before they list or close.

Re-verify all figures at publish — these rules move faster than platform data updates. A street address in the Charleston metro does not tell you which ordinance applies. Confirm parcel jurisdiction via TMS lookup and verify permit status with the governing town or city before you wire earnest money.

Side-by-Side Cap and Rule Comparison

Jurisdiction	Cap / limit	Permit types	New entrant status (2026)	Guest tax ~
Folly Beach	800 ISTR (investor); OSTR 72 days/yr	OSTR / ISTR / LTR / PSTR	Waitlist ~185+; cap upheld Mar 2026; under city review	~14% + beach fees
Isle of Palms	No cap	Business license	Open — competitive	~14% + 1% preservation
Mount Pleasant	400 permits (~1%)	Part-time 15–72 days / Full-time 72+	2026 renewals closed; waitlist	~14%
North Charleston	60 per district (~600 citywide)	STR permit + license	Districts 5,6,8,10 over cap	~14% / ~12% Berkeley
Sullivan's Island	28-night minimum	Grandfathered only	Closed to new nightly STR	~14% + 1% town
Kiawah	Zone 1: 40% density	Town license + KICA	Zone-dependent	~14% county stack
Seabrook	557 overlay + 110 other	Class A/B/C permits	Permit-limited (May 2025 regime)	~14% county stack
City of Charleston	De-facto brake	Cat 1/2/3	Owner-occupied only	~14%
Charleston County	Day caps	Limited 72 / Extended 144 days	County case-by-case	County + state layers

The table is the spine. Every purchase or launch decision should start here, then drill into the jurisdiction section that matches your parcel.

Folly Beach — 800 Cap, Waitlist, and 2026 Review

Voters approved the 800 ISTR cap in February 2023. The South Carolina Court of Appeals upheld it in COA-2026-UP-075 (March 2026) — the "Scrap the Cap" legal challenge failed. Approximately 926 properties were grandfathered; the city had not dropped below 800 as of late 2025, with 185 or more on the waitlist. The official city page projects no new licenses for the current business license year. City Council continues its 2026 ordinance review with public input, but hosts should market under the current law, not under a hypothetical cap removal.

ISTR (investor) licenses carry a 6% property tax rate with no night limit, subject to the 800 cap. OSTR (owner-occupied) licenses carry a 4% tax rate with a maximum of 72 rental days per year. A 28-day minimum applies to maintain the rental license (for the 2024 license year and forward). Business license renewals are due April 30, 2026. STR registration renewals are due June 1, 2026.

Do not buy the Folly investment property assuming you can obtain a permit after closing. ISTR licenses are largely non-transferable. Entry requires either an existing license or a position on the waitlist with realistic timeline expectations.

Isle of Palms — The Open Lane

The November 2023 referendum rejected a proposed 1,600-license cap, with approximately 54% voting against. IOP remains the strongest open-beach market in the Charleston metro for new nightly STR entrants that can compete on amenities and marketing.

An STR business license is required. The fee runs $450 on the first $2,000 of gross plus $4.60 per additional $1,000, due April 30. Occupancy follows a formula of two guests per bedroom plus two, maximum 12 overnight (children under 2 excluded). A 1% beach preservation fee applies on qualifying stays. IOP leaders declined a camera-in-STR ordinance — state law governs surveillance rules.

AirROI shows approximately $86,609 in average revenue and $768 in ADR on IOP, while supply grew +30.5% year-over-year. Open entry does not mean easy margins. Differentiation through photography, amenities, and compliance-forward copy matters more as inventory rises.

Mount Pleasant — 400 Cap and 2026 Renewal Halt

The original 400-permit cap represents roughly 1% of residences. Part-time permits cover 15–72 rental days; full-time permits cover 72 or more days. Application fees are $250 for part-time and $500 for full-time. Permit holders need a business license, certificate of occupancy, and a designated local agent.

The town stopped 2026 renewal applications and operates a waitlist via str@tompsc.com. Mount Pleasant is functionally closed to new entrants for 2026. Buyers who acquire property, assuming they can obtain a new permit, should confirm waitlist status and transferability with the town before inspection.

Sullivan's Island, North Charleston, and Gated Islands

Sullivan's Island requires a 28-consecutive-night minimum in town rental agreements. Rentals of fewer than 28 nights are deemed illegal and subject to criminal prosecution. Only grandfathered pre-2002 ordinance properties operate as traditional STRs. New entrants should pursue a 30-plus-day furnished mid-term strategy, not nightly vacation economics.

North Charleston adopted a 60-permit-per-council-district cap in February 2025, for a total of roughly 600 citywide across ten districts. Districts 5, 6, 8, and 10 were already over cap at adoption — new permits are blocked in those districts. Owner-occupied room rentals are exempt from the district cap. ADR runs approximately $217–$240 on AirROI — a value play versus beach islands, not premium beach math. Berkeley County portions carry approximately 12% tax stack versus approximately 14% in county portions.

Kiawah operates a three-zone density model. Zone 1 carries a 40% STR density cap; Zones 2 and 3 in resort areas have no STR density cap. STR license fees run $500 in R1/R2 capped zones or $200 for other properties. KICA gate passes operate separately from town STR licensing.

Seabrook's May 1, 2025, regime caps 557 permits in the STR Overlay District and 110 elsewhere. Class A/B/C permit fees are $150, $ 50, and $50. Business license minimum is $500 Class A on the first $2,000 gross. Renewal is due April 30. Rental activity logs are required from May 1, 2025, forward.

Charleston County Day Caps — James and Johns Island Context

Unincorporated James Island and Johns Island parcels outside city limits operate under county programs, not Folly's 800-license cap or IOP's no-cap business-license model.

Limited Home Rental permits cover owner-occupied primary residences at 72 days per year with a $50 application fee. Extended Home Rental permits cover investment and secondary properties, allowing 144 days per year, a $100 application fee, and case-by-case approval with public notification.

County enforcement intensified in 2026 (Live 5 News). Day-cap violations are an active enforcement priority. Model revenue on legal nights only — not 365-day platform fantasies.

Taxes, Beach Fees, and Direct Booking Responsibility

The Charleston County tax stack runs approximately 14% on short stays. Folly adds 1% municipal plus 1% beach preservation. IOP adds 1% preservation. Sullivan's adds 1% town fee on qualifying stays. North Charleston and Berkeley County portions carry approximately 12% without the Charleston County accommodations layer.

Marketplace facilitators collect on OTAs. Direct booking means the host's responsibility for remittance. Quote the correct jurisdictional rate at checkout and register separately for direct-booking tax compliance.

Opening a New STR by Jurisdiction — Practical Steps

On the Isle of Palms, apply for an STR business license through Building, Planning, and Zoning. Set max occupancy per the two-per-bedroom-plus-two formula. Display the license on OTAs and your direct site. Register for tax remittance on direct bookings.

On Mount Pleasant in 2026, confirm existing permit or waitlist status via str@tompsc.com before any marketing spend. If permitted, obtain or renew a business license, certificate of occupancy, and designate a local agent. Match your calendar to part-time or full-time tier limits.

On Folly Beach, confirm ISTR, OSTR, or purchase-with-license status before listing. Obtain a business license and STR registration and display numbers in all ads. Enforce the OSTR 72-day cap or ISTR whole-home rules per license class. Collect 1% municipal plus 1% beach preservation fees on qualifying stays.

For North Charleston, verify district permit availability with the city STR office before closing. For county James and Johns Island parcels, apply for Limited or Extended Home Rental and model nights within the 72- or 144-day cap.

Buyer Decision Tree — Where Capital Can Still Deploy

Need nightly beach STR? Isle of Palms is open; Folly requires a license in hand. Need downtown walkability? City owner-occupied Category 1 or 2 only. Need investment without occupying? Johns Island County 144-day Extended Home Rental, North Charleston, with district verification, or IOP with competitive marketing. Want a quiet residential island? Sullivan's mid-term only unless grandfathered. Want gated golf luxury? Kiawah or Seabrook with permit verification before purchase.

Work with Crest & Cove Creative

Marketing a Folly, Isle of Palms, or Mount Pleasant rental and want island-specific positioning that converts?

We help Lowcountry hosts with jurisdiction-accurate listing titles, event-calendar pricing for peak Charleston weekends, guest guidebooks tuned to each island's guest type, and direct-booking copy that merchandises what guests actually book for. If you want hands-on help implementing any of that on your property, our team takes a limited number of new engagements per quarter. Reach out at crestcove.co — we'll take an honest look at where your listing stands and tell you plainly whether we can help.

Frequently Asked Questions

What is the Folly Beach 800 cap? A hard limit on non-owner-occupied investor STR licenses, upheld by the South Carolina Court of Appeals in March 2026 under COA-2026-UP-075. Approximately 185 properties are on the waitlist. The city projects no new ISTR licenses for the current business license year while a 2026 ordinance review continues.

Does the Isle of Palms have a cap? No. Voters rejected a proposed 1,600-license cap in November 2023 with approximately 54% against. STR business license required; fee $450 on first $2,000 gross plus $4.60 per additional $1,000, due April 30.

What is Mount Pleasant's STR limit? 400 permits representing roughly 1% of residences. Part-time permits cost $250; full-time permits cost $500. The town stopped 2026 renewal applications and operates a waitlist via str@tompsc.com — functionally closed to new entrants for 2026.

Can you Airbnb on Sullivan's Island? Not under 28 consecutive nights except grandfathered properties. Rentals of fewer than 28 nights are deemed illegal and subject to criminal prosecution. New buyers should assume a mid-term furnished strategy only.

What is North Charleston's cap? 60 permits per council district, adopted February 2025, roughly 600 citywide. Districts 5, 6, 8, and 10 were over-cap at adoption. Owner-occupied room rentals are exempt.

Where can new investors legally buy in? Isle of Palms (no cap), unincorporated Johns Island Extended Home Rental (144 days per year, case-by-case), North Charleston (district-dependent), and capped markets only via license transfer or waitlist — verify each before purchase. Folly requires an existing ISTR license. Mount Pleasant is closed to new entrants in 2026.

Was Folly Beach's cap upheld in court? Yes. The South Carolina Court of Appeals affirmed the 800-license limit in COA-2026-UP-075 (March 2026). Hosts should market under the current law while the City Council reviews the ordinance.

What taxes do Charleston-area beach STRs collect? Approximately 14% county stack on most short stays, with Folly adding 1% municipal plus 1% beach preservation, IOP adding 1% preservation, and Sullivan's adding 1% town fee. North Charleston and Berkeley County portions run approximately 12%. Direct-booking hosts remit; OTAs generally collect via marketplace facilitators.

About the Authors

Crest & Cove Creative is a Southeast-focused short-term rental marketing agency founded by Thomas Garner and Jacob Mishalanie. We build direct-booking brands, listing-optimization systems, and market-specific content strategies for independent STR operators across the Gulf Coast, Appalachian Mountains, Coastal Georgia, the Carolinas, Virginia, and the Southeast lake country.