Key Highlights
- Travel rebounding and with it, vacation-rentals market
- Pent-up demand over the top
“One of the Most Exciting Times” in Vacation- Rentals Market
If you and/or your clients are thinking about renting a vacation house this summer, you all may be too late
In March, according to VRBO, 90% of its vacation homes in Cape Cod and on the Jersey Shore were already booked for July. Noelle Randal, founder of a crowd-funded, short-term rental company Nuurez, said, “It’s crazy – there’s so much pent-up demand. We have bookings through August on almost every property – like, totally booked up; all of June booked up, all of July booked up.”
Carrington Carter, co-founder and managing partner of Getaway Society, a luxury vacation-rentals company serving properties in Martha’s Vineyard, Hilton Head, and other such markets, said, “This is probably contradictory to what a lot of people may think, but it’s really one of the most exciting times in the industry right now.”
Increased Long-Term Confidence in Booking Summer Travel
Pre-pandemic, travelers might have thought about booking a vacation rental a month before or even a few days before wanting to “get away.” Not anymore.
Bookings are up everywhere in the country at least 30% compared to how booking forecasts looked for the same time period in 2019. (We’re forgetting about 2020 for obvious reasons.)
According to Michael Winner, co-owner of Barkwells that specializes in dog-friendly vacation rentals in the Blue Ridge Mountains, his company is booked for the rest of the year. “It’s a combination of people being cooped up from home and being desperate to get out.”
Competition for Vacation Rentals Is Stiff
Not only are cancelation rates substantially lower because guests don’t want to give up what they’ve booked, second-home buyers actually want to use their weekend houses themselves.
Carter, co-founder of Getaway Society,said, “With the flexibility of remote work, owners are finding that they have more time to enjoy their second homes and are renting them less, if at all.”
The only downside of being booked solid is that, according to Randall of Nuunez, last minute bookings help”… increase your bottom-line. This year, we may not have that opportunity at all.”
Not Enough Supply Means Higher Prices
Just like the for-sale housing market, lack of supply in the vacation-rentals market means paying more than you did in 2019.
According to Transparent, a vacation-rentals data company, Airbnb vacation properties are expected to run about $220/night in July and August. In 2020, the cost was $194/night; in 2019, the cost was $185/night.
Evolve, another hospitality company, has increased its rates by +27% in July and +19% in August compared to those months in 2019.
Stay Marquis, a lux vacation-property management company, indicated its average rates in the Hamptons this summer are up +12% over 2019. In Hawaii with Hawai’i Life, both a lux brokerage and rental management company, rates are up +11% from 2019.
Non-urban Destinations Seeing Uptick in Demand
AirDNA, a data firm that analyzes +10M vacation rentals globally, indicated that summer bookings in typically non-summer destinations such as Broken Bow Lake OK and the North Georgia Mountains are up +68% and +46% respectively, compared to 2019.
Coastal destinations are up +18% and destinations with mountains and lakes are up +14%.
Additionally, a new survey from Airbnb indicates that rural properties 1,000 to 3,000 miles from home have generated the second largest share of searches for Memorial Day Weekend trips behind rural rentals within a 300-mile radius
Maybe owning a second home and/or condominium as a vacation rental isn’t such a bad idea after all?
Thanks to The New York Times.
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