Key Highlights
- Inventory shortages in vacation-rental market spurring fierce competition among listing platforms
- Listing platforms adding new features/programs to keep up with boom in bookings
Short-Term Rental Sites Short on Inventory for Out & About Vacationers
In the midst of a supply squeeze, demand for short-term rentals, particularly near beaches and national parks, is accelerating as the economy reopens and vaccination rates rise.
Why the supply squeeze? Many owners of short-term rentals are not listing their properties on these various rental sites, according to a recent report by The Wall Street Journal. Instead, these owners are staying in, and in some cases living in, their rental units themselves.
AirDNA indicates available listings on both Airbnb and Vrbo were down -4,3% in May 2021 compared to May 2019. (Forget 2020.) Despite this decrease in available units, AirDNA indicated that the total number of listings on the two platforms increased by +8.5% in May 2021.
How Are Vacation-Rental Sites Dealing with Insufficient Supply to Satisfy Pandemic-Inspired Pent-Up Demand?
Like employers with un-filled positions, vacation-rental sites are offering perks, simplified sign-up procedures, training/mentoring features, referral and/or bonus payments to hosts who can persuade others to list their rental units, etc.
Clearly, competition is the name of the game for these rental sites. These sites are experimenting with any ideas, programs, collaborations, and/or referral strategies in hopes of getting a leg up on their competitors.
New Upgrades, Features and Programs for Existing and New Hosts
Airbnb has rolled out new features in hopes of making it easier to become and continue being rental property hosts on its site. It has simplified its sign-up protocols, added more than 100 upgrades to its platform, and is offering referral/bonus payments to encourage existing hosts to solicit others to list their properties on the Airbnb platform.
Vrbo added its Fast Start program that enables Airbnb hosts to transfer their Airbnb ratings to Vrbo in order for hosts to get more eyes on their listings with “double exposure” cross listings.
Both Vrbo and Airbnb have initiated recruitment programs accompanied with payment schedules to solicit “guests” to become “hosts.”
Demand Outstripping Supply in Some Markets
According to AirDNA, in-demand markets where listings have declined include the West Coast destinations of Lake Tahoe, Joshua Tree and the Coachella Valley. New York’s Lower Hudson Valley is also under-supplied for pandemic-inspired pent-up demand.
Additionally, the more remote working takes hold, higher demand for both short-term and long-term rental listings is seemingly inevitable.
Both Expedia and Booking.com offer their respective platform users hotel listings as well rental listings for homes and apartments. Both of these companies have announced they plan to invest more in vacation rentals over the next few years.
Bottom line: competition among vacation rental sites for both hosts and users is fierce…just as competition among agents and brokers for both homebuyers and sellers is fierce.
Thanks to The Wall Street Journal and AirDNA.
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