Palmetto Dunes occupies a distinctive position on Hilton Head Island: a gated oceanfront resort that formally welcomes short-term rental, giving villa and condo owners the flexibility to use the home part of the year and generate rental income otherwise. The community's enduring amenities — miles of Atlantic beachfront, three championship golf courses, Shelter Cove Harbour marina, and the Palmetto Dunes Tennis and Pickleball Center — sustain the vacation demand that makes that ownership model viable.
Short-term rentals are permitted in Palmetto Dunes under its oceanfront-resort framework. Villas, condos, and most single-family homes may operate rentals of fewer than 30 days with a Town of Hilton Head STR permit ($150 per bedroom annually) and a Town business license. Note: single-family detached homes within the Leamington neighborhood are an exception and are not STR-eligible.
At a glance
Short-Term Rentals in Palmetto Dunes at a glance
Palmetto Dunes occupies a distinctive position on Hilton Head Island: a gated oceanfront resort that formally welcomes short-term rental, giving villa and condo owners the flexibility to use the home part of the year and generate rental income otherwise. The community's enduring amenities — miles of Atlantic beachfront, three championship golf courses, Shelter Cove Harbour marina, and the Palmetto Dunes Tennis and Pickleball Center — sustain the vacation demand that makes that ownership model viable.
Community
Palmetto Dunes, Hilton Head Island, South Carolina
Median sale price
$2,050,000 (single-family homes, May 2026)
Short-term rentals
Permitted — with a Town of Hilton Head permit + business license
Guide
Short-Term Rentals in Palmetto Dunes
Updated July 2026
The Guide
Short-Term Rentals in Palmetto Dunes
Palmetto Dunes operates under an oceanfront-resort framework that formally permits short-term rental activity — a meaningful distinction on an island where community-level STR policies vary widely across its gated boundaries. Villas and condos throughout the community have long been operated as vacation rentals alongside second-home ownership, and the resort's defining amenities — miles of Atlantic beachfront, three championship golf courses designed by Arthur Hills, George Fazio, and Robert Trent Jones, and an eleven-mile lagoon system — sustain consistent vacation demand across seasons.
The community's most recognized villa address for rental-oriented buyers is Villamare: an oceanfront complex positioned directly on the Atlantic beach, with boardwalk access to the sand, two outdoor oceanfront pools, an indoor heated pool, spa, and fitness center. Units at Villamare and comparable complexes within Palmetto Dunes are commonly marketed with documented rental histories, reflecting the community's established position as a vacation-rental destination. Shelter Cove Harbour marina, the Palmetto Dunes Tennis and Pickleball Center, and the three championship courses are all within the resort gates — the amenity depth that supports sustained rental demand year over year.
One internal distinction matters most for STR buyers: the Leamington neighborhood within Palmetto Dunes prohibits short-term rental for single-family detached homes. Leamington villas and condos are not subject to this restriction and remain STR-eligible under the resort framework. Beyond the Leamington boundary, individual villa and condo complexes carry their own regime rules that can be more specific — and more restrictive — than the community-wide policy. Both layers require direct verification before any offer on a property intended for rental income.
What to know
How it works
Operating a short-term rental in Palmetto Dunes involves a dual compliance framework. Community-side, owners register emergency and local management contacts annually with the PDPOA, and every online listing must prominently display the Town STR permit number. Town-side, owners obtain both a Town of Hilton Head STR permit and a separate Town business license; both register under an individual's name, not a corporate entity. The STR permit fee is currently $150 per bedroom per year. The annual permit window opens April 6; renewals must be filed by April 30, with a $250 late fee applying to submissions after that date. Permits are non-transferrable and non-refundable — a buyer cannot inherit the seller's permit and must apply independently before the first rental.
Day-to-day operations carry their own requirements: single-party leases only (no room-by-room rentals), a maximum of six guest vehicles parked on improved driveway surfaces, a one-hour response requirement for nuisance complaints backed by the island-wide STR hotline, and fire-safety requirements that include smoke alarms in every bedroom and on every floor. On the revenue side, owners collect and remit South Carolina accommodations and sales taxes along with Town of Hilton Head accommodations tax and a Beach Preservation Fee — all filed quarterly with the Town Revenue Services Office. Buyers evaluating rental economics should account for this layered compliance stack alongside any income projections drawn from comparable unit histories.
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Rental Rules
Short-term rentals in Palmetto Dunes
Short-term rentals are permitted in Palmetto Dunes under the community's oceanfront-resort framework. Villas, condos, and most single-family homes are eligible with a Town of Hilton Head STR permit ($150 per bedroom per year) and a Town business license. Exception: single-family detached homes in the Leamington neighborhood are not STR-eligible — Leamington villas and condos are. Individual complex regime rules may be more restrictive than the community-wide policy and require separate verification before any offer.
Buyer Questions
Short-Term Rentals in Palmetto Dunes — answered
Can you rent out a villa short-term in Palmetto Dunes on Hilton Head Island, and what does the permit cost?
Yes — Palmetto Dunes permits short-term rentals for villas, condos, and most single-family homes under its oceanfront-resort framework. The Town of Hilton Head STR permit is currently $150 per bedroom per year, and a separate Town business license is also required. The permit window opens April 6 annually; renewals submitted after April 30 (May 15 in the 2026 cycle) incur a $250 late fee. Permits are non-transferrable, so a new owner must apply independently and plan accordingly before the first rental.
Can you short-term rent in Sea Pines or Palmetto Dunes?
Both communities permit short-term rentals. Palmetto Dunes' resort framework welcomes STRs for villas, condos, and most single-family homes — with the notable exception of single-family detached homes in the Leamington neighborhood, where STR is prohibited (Leamington villas and condos remain eligible). Sea Pines similarly allows STRs at the community level, with certain sub-neighborhoods inside the gates enforcing stricter covenants. Both communities require the Town of Hilton Head STR permit and business license on top of any community-level rules.
What are Villamare Villas in Palmetto Dunes, and can those condos be rented short-term?
Villamare is Palmetto Dunes' signature oceanfront villa complex, positioned directly on the Atlantic beach with boardwalk access to the sand, two outdoor oceanfront pools, an indoor heated pool, spa, and fitness center. Units at Villamare are eligible for short-term rental under the resort framework and are commonly marketed with documented rental histories. As with any villa or condo purchase, the complex's regime declaration is the controlling document for any unit-specific restrictions beyond the community-wide policy.
Are oceanview condos for sale in Palmetto Dunes typically marketed with rental history?
Yes — villa and condo units in Palmetto Dunes, particularly at oceanfront complexes such as Villamare, are commonly marketed with documented rental history. For buyers seeking a property with an established rental track record, the resort's long-standing position as a vacation destination means such units appear regularly in the market. Reviewing unit-level rental documentation alongside the regime governing documents is the essential diligence step before any offer. COAST brokered by eXp Realty can help coordinate that review.
What is the Leamington exception, and how does it affect a Palmetto Dunes STR purchase?
Leamington is a neighborhood within Palmetto Dunes where short-term rental is prohibited for single-family detached homes — Leamington villas and condos, however, remain STR-eligible under the resort framework. Any buyer targeting a Palmetto Dunes property for rental income should confirm whether the specific address falls within the Leamington boundary before making an offer. Beyond Leamington, individual villa and condo complex regime declarations may carry additional restrictions, making document review a key step in every purchase regardless of neighborhood.
What taxes apply to a Palmetto Dunes short-term rental, and how are they filed?
STR owners are responsible for a layered tax stack: South Carolina state sales tax, SC accommodations tax, Town of Hilton Head accommodations tax, and a Beach Preservation Fee — collectively estimated at approximately 9–13% of gross rental revenue, though exact rates should be confirmed with the Town Revenue Services Office at filing time. All taxes are filed quarterly with the Town. The annual STR permit fee ($150 per bedroom) is a separate annual operating expense distinct from the tax remittance obligations.
What operational rules should a Palmetto Dunes STR owner plan for beyond the permit?
Beyond the Town permit and business license, STR owners must register emergency and local management contacts annually with the PDPOA and display the Town permit number prominently on every online listing. Operating requirements include single-party leases only (no room-by-room rentals), a maximum of six guest vehicles parked on improved driveway surfaces, a one-hour response requirement for nuisance complaints, and fire-safety requirements that include smoke alarms in every bedroom and on every floor. Guest resort passes or decals must be displayed at all times; motorcycles, RVs, and motorhomes are prohibited inside the resort gates.
What should a buyer verify before making an offer on a Palmetto Dunes property intended for short-term rental?
Three verification layers matter before any offer: first, confirm whether the property falls within the Leamington neighborhood, where STR is prohibited for single-family detached homes; second, review the specific complex's regime declaration, which may be more restrictive than the community-wide policy; and third, understand that Town STR permits are non-transferrable — a buyer applies anew and should factor the April 6 permit window into timing for the first rental season. Connecting with COAST brokered by eXp Realty early in the search process helps map all three layers to the specific property.
23closed transactions in the Palmetto Dunes / Shelter Cove area2023–present
May 2026most recent closingbrokerage records
Verified from COAST brokered by eXp Realty closed-transaction records, 2023–present — counted per side represented, matching eXp production reporting. Talk to the team about Palmetto Dunes below.
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