10 Surprising Statistics about Vacation Rental
Vacation Rentals and peer-to-peer lodging were considered to be non-feasible and unsustainable ideas a few years ago. The tourists and travellers were reluctant in trying vacation rentals while the owners also had their own reservations in letting random strangers stay in their homes.
In fact, the hotel industry completely ignored the vacation rentals segment for a long time, with Expedia and Priceline Group not feeling a need to enter into this industry, and the CEO of Hilton saying “it is impossible for peer-to-peer lodging to post a real threat to hotels”.
However, things have taken a completely different turn today. Vacation rental industry has seen phenomenal growth in the past decade and is posing a serious threat to the traditional hotel’s industry. Travellers have become comfortable with the idea of staying in a rented property, and the hosts or the owners of the vacation rentals have become more professional in dealing with the guest bookings and have upped their game by providing superior experiences to their guests.
We conducted secondary research from our end and have curated 10 facts about the vacation rental industry that will surprise you.
1. Vacation Rental Industry is Expected to Topple the Hotel Industry By 2021
According to a CBRE hotels report from 2016, the growth of Airbnb units is substantially higher than that of the US hotel industry. Airbnb is already accounting for about 9% of the total lodging units in the 10 largest US markets and this number seems to be doubling year on year while the hotel industry is almost saturated with only 1.1% annual growth. Moreover, Airbnb constitutes just one segment of the vacation rentals industry which is huge today and comprises of many more listing websites and independent properties as well.
2. More and More People Who Use Airbnb Don’t Want to Go Back to The Hotels.
According to Bloomberg, people who have used peer-to-peer accommodation have lower inclination to prefer traditional hotels in their future trips.
In fact, the likelihood that the users will prefer traditional hotels is halved if they have stayed in P2P accommodation before, keeping the price, location and quality the same.
The report reads, “We find it interesting that people ‘do a 180’ in their preferences once they use P2P lodging. They move directly from preferring traditional hotels to preferring P2P accommodation.”
This is really useful for vacation rental industry as more and more people are now becoming aware of the vacation rentals and are willing to make a choice to stay there, given the quality of the experience is comparable and prices are aggregable to them.
3. Europe Had the Maximum Share (60%) of Vacation Rentals in 2018
A market study conducted by Hostfully stated that there are 115,000 vacation rental companies in 2018, globally.
Out of these, there are about 20% of the vacation rental properties in the USA and 60% in Europe.
Rest of the world constitutes 20% of the vacation rental properties. Europe with about 69,000 rental properties enjoys the maximum share of vacation rental companies today, while the US is the fastest growing market with increasing interest of owners in renting out their property.
4. A Whooping 25% of the Second Homes in the US Are Used as a Rental Property and Are Professionally Managed.
According to U.S. consensus data, there are 252 million housing units in the U.S. in 2018, out of the 3.5% are being used as second homes. Therefore, there are about 9 million second homes in the United States.
Hostfully report on the market sizing of U.S. vacation rental industry estimates that 44% of these homes are professionally managed and 25-35% of them are rented out. The report also states that about 25% of all second homes in the U.S. are both used as a rental property and are professionally managed as well. The report also categorizes the vacation rental companies based on their size. A majority (about 70%) of the rental companies are small, managing 1-9 vacation rental units.
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5. Millennials Make 40% of The Leisure Travellers, Who Book Their Travel Online.
Currently, millennials are the most attractive customer segment in the vacation rental industry. They constitute 40% of the leisure travellers globally who make their bookings online. Some of the other interesting facts about millennial behaviour are:
- They use mobile devices and digital platforms to make the bookings
- They use their business trips as an opportunity to create personal vacations
- Their expenditure on vacations each day is higher than the other age groups.
According to Turnkey vacation rentals, millennials are predicted to spend $1.4 trillion on travel each year by 2020.
6. The Most Important Reason Why People Stay in Vacation Rentals is Access to the Kitchen to Cook Your Own Meals.
Access to kitchen, good value/price and privacy are the top three reasons why people prefer to stay in vacation rentals over the hotels and resorts. Ample space for a group, access to outdoor space and other amenities are some of the other factors that lead to people choosing vacation rentals for their stay rather than traditional hotels.
Source: Statista.com (United States; Tripping; Home Depot; as of June 2016; 1,620 respondents; 79 percent of respondents have rented a vacation home in the past.)
7. Glamping and Peer-to-Peer Boat Rentals Are Some of the Unique Vacation Rentals Demands Emerging in the USA.
There are some unique vacation rental trends emerging in the USA recently. Glamping (glamorous camping) is one such trend which is on the rise. The Public Relations and Marketing Executive at Glamping Hub recently shared with a vacation rental blog Hostfully that “Just a few months earlier, we had 14,000 accommodations on our site, and we are now at 25,0007.”
Another unique trend that has emerged is the peer-to-peer boat rental community. More and more people are getting interested in renting boats through peer-to-peer boat renting website Samboat, which mostly has rentals in Europe and has recently started to pick-up in the U.S. as well.
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8. On-site Videos Are the Most Popular Technique Vacation Rental Companies Are Using to Increase Traffic on Their Sites.
On-site Videos are increasingly becoming the go-to-tools for vacation rental companies to increase their bookings. On-site videos are expected to increase website traffic by about 200-300%.
Companies usually place videos on their blog site, website, company profile page or other landing pages. 1.5-2 mins videos are the most effective since they hold the attention of viewers while also delivering all the necessary information to them. Below infographic from vacation renal marketing blog shows more details-
Source: http://www.vacationrentalmarketingblog.com
9. Cities Continue to Emerge as the Hotspot for Rentals.
Vacation rental properties are seeing increasing demand from the cities. The growth of urban private accommodating is driving a change in destination mix for the travellers and tourists.
Cities which earlier constituted only 13% of the destination choices of travellers, now stand at 34%. Vacation rental companies can make use of this information and leverage the growing demand in cities to their advantage.
Source: https://skift.com
10. 84% of Vacation Rental Companies Want to Offer Services that Are Unavailable Within Their Current Software Suite.
There has been a growing focus on hospitality in the vacation rental industry. A report by Hostfully, titled “The X-factor in Vacation Rental Travel: Hospitality”, highlights the need for better vacation rental management tools, the importance of local recommendations and a growing interest in providing better hospitality to the guests.
There are also ample opportunities with the property management software companies since about 84% of the vacation rental companies have shown interest in services that are currently not being provided by their current software suite.