Savannah vs Charleston Cost Segregation: Two Historic Southern STR Markets, Different State Tax Positions

Quick answer

Across 5 engine fixtures for the Savannah area, the differences between Charleston and the rest of Savannah come down to three factors: land allocation, property archetype mix, and HOA capital-assessment patterns. See the per-fixture detail below.

Side-by-side per-fixture

Property	Sub-market	Price	Reclass %	Y1 fed savings @ 37%	Land %
Historic District Townhome STR SFR · STR	Historic District (square-anchored)	$985,000	23.3%	$70,504	17.0%
Victorian District Renovated SFR SFR · STR	Victorian District / Thomas Square	$685,000	22.6%	$47,117	17.6%
Starland District SFR STR SFR · STR	Starland District	$585,000	22.3%	$39,374	18.6%
Ardsley Park Bungalow SFR	Ardsley Park / Chatham Crescent	$525,000	15.5%	$24,980	17.1%
Tybee Island Beach Cottage STR SFR · STR	Tybee Island (Chatham County coastal)	$685,000	24.7%	$50,167	20.0%

What's the same

• Tax law. Both sub-markets are in Georgia, subject to the same state conformity rules: Georgia partially decouples from federal §168(k). GA historically required an addback for federal bonus depreciation, with the addback amount recovered over the regular MACRS schedule for state purposes. For 2025+ acquisitions under OBBBA's 100% federal bonus, a portion of accelerated reclassification dollars hit a GA-side timing mismatch. At GA's 5.49% flat rate, the absolute dollar impact is modest but real. The federal §168(k) acceleration is unaffected; only the GA Schedule 1 reconciliation is the variable.
• Federal §168(k) bonus depreciation. 100% under OBBBA, permanently restored for 2025+ acquisitions.
• MACRS classification methodology. Same Rev. Proc. 87-56 asset class life assignments regardless of sub-market.
• Engine methodology. Same RSMeans 2024 base costs, same BLS PPI time index, same geo factor (these are city-level, not sub-market-level).

What's different

• Land allocation. Charleston typically runs higher on land allocation because of either resort-tier land scarcity premiums or proximity-to-amenity scarcity. This compresses depreciable basis as a percentage of purchase, even though absolute basis is larger.
• Property archetype mix. Charleston concentrates in higher-end vacation rental product, while the broader Savannah market includes more off-market SFRs and longer-tail product.
• HOA capital assessment patterns. Resort-tier HOAs in Charleston often levy special assessments for infrastructure (snowmelt, lift access, parking decks). Those assessments add to depreciable basis but distort the per-fixture cost-seg picture if the buyer doesn't separate base purchase from assessments paid.
• STR economics. Different ADR (average daily rate) profiles and material-participation friction.

Which is better for cost-seg ROI?

It depends on what "better" means.

If you measure ROI as Year-1 federal savings dollars: Charleston wins on absolute dollars (higher purchase prices = larger absolute deductions). If you measure ROI as savings-per-dollar-of-purchase: the broader Savannah non-resort sub-markets typically win (lower land allocation = more depreciable basis as % of price).

For most buyers, the more useful question is: which sub-market matches my buy-box? If you're already buying $2M+ resort-tier product, the cost-seg differential is a rounding error against your decision drivers. If you're price-shopping across sub-markets and considering both, the broader Savannah non-resort areas produce more reclassification per dollar.

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