The boom in short term rentals bookings. Will it be prolonged or will it end soon?
The Phocuswire platform shared with us an analysis made by Jill Menze, in which it shows us the reason for the current boom in Vacation Homes and if it tends to last over time.
Compared to other sectors of the travel industry, the short-term rental market has thrived amid the COVID-19 pandemic, and the United States has officially recovered demand above 2019 levels as of April 2021. Many of the major alternative hosting platforms are bracing for what they see as a record travel spike on the horizon and pushing new initiatives to attract more hosts to their respective services.
According to a new report from AirDNA, the next major performance milestone for short-term rentals in the US, relative to whether the industry recovers demand to the level it would have reached if the sector had maintained its 2019 growth rate. AirDNA data points to another two years or more to achieve this, although it could be achieved sooner if certain scenarios are met.
For his part, Mateo Bradford, strategic partnership and business development of At Ease Rentals Corporation, believes that demand levels will continue to increase: “I believe that demand will exceed those levels, because remote work and lifestyle will continue to drive that demand. I think we will see a slight drop when the service sector returns to work, but that will not prevent leisure, vacations and nomads from leaving home”. While new demand in the small city, rural and resort destination markets dominated 2020 and 2021, 2022 will be about a return to cities, AirDNA predicts.
As of April 2021, demand in urban areas was still down 40% compared to 2019. But as vaccines are distributed and attractions reopen, urban travel is expected to start picking up in the second half of 2021 and seriously in 2022, with urban demand in its entirety. recovering to 2019 levels by 2023.
According to AirDNA, urban rentals could recover faster if business travelers opt for private accommodation, although other factors are also at play.
While alternative accommodation providers like Airbnb are betting heavily on flexible living and long-term stays, in the first quarter, the shared housing giant said that 24% of its nights booked were for stays of 28 days or more, AirDNA does not predict that remote work will. They remain the norm once companies feel it is safe to return workers to the office.
That said, with more flexibility, extended travel will become more common than it was before the pandemic. According to AirDNA, in the first quarter of 2021, the average length of stay was four days, 25% longer than before the pandemic, mainly due to longer stays in large and medium-sized cities. As business and leisure travel returns to these cities, AirDNA expects the length of stay to shorten but remain substantially above 2019 levels.
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