Westford, USA, July 28, 2022 (GLOBE NEWSWIRE) -- As the economy continues to grow, more people are looking for ways to save money on their vacations. One option is to visit vacation rental properties. In recent years, this industry has seen incredible growth, as more and more people are looking to stay in accommodations that are both convenient and affordable.
There are several reasons why the vacation rental market is growing so rapidly. First of all, there is a growing demand for unique vacation destinations that are not available domestically. This is especially true for those who want to experience the local culture while they're on vacation. Additionally, there is a growing trend of people wanting to stay closer to major metropolitan areas, rather than traveling out of town to find a vacation rental property.
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Post Pandemic Revenge Travel Boosted Vacation Rental Market Growth
Even before the pandemic hit, vacation rentals saw immense growth due to people wanting to get away from the bustle of everyday life. It wasn't long after the Covid pandemic began that demand for vacation rentals took off. In the pick period of Covid Pandemic, the vacation rental market witnessed occupancy dropped down to less than 10% and many had to shut down their operations due to limited cash flow and unseen circumstances.
However, the scenario changes significantly in 2021 as people were looking for an escape, and despite conditions being difficult in some parts of the world, many found that the availability of rentals made it possible to take a trip that suited their needs.
The pandemic has only made this revenge travel trend stronger. People are looking for ways to relax and get away from the constantly busy lifestyle that comes with living in modern society. This is also true for businesses and corporations who want to provide employees with a chance to take a break and recharge.
Many rental properties are now taking advantage of the pandemic by offering special deals or discounts on rates. Some owners are even allowing people to rent out their properties even if they are not currently using them themselves. This offers a way for people who might not ordinarily be able to take a vacation the chance to experience another part of the world where they can relax and recharge.
There's no doubt that the pandemic has changed the way people travel. For many of us, the thought of getting on a crowded plane or staying in a busy hotel just doesn't appeal anymore. That's why vacation rentals have become so popular in recent months. They offer a sense of privacy and isolation that people just can't get at a traditional hotel.
And it seems that people are already planning their post-pandemic revenge travel. A recent survey found that nearly 50% of all travelers are planning to take a trip specifically to get away from the stress of the past year. And what better way to do that than by renting your own private vacation home? In fact, the global vacation rental market has witnessed around 280% growth in the footfall of travelers as compared to 2020.
Current Investment Trends in Vacation Rental Market
There's no question that the vacation rental industry is booming! As per SkyQuest Technology's market analysis, the global vacation rental market was valued at $74.64 billion in 2021. That's up 32.04% from 2020, and it's expected to grow even further in the next couple of years. And while there are a lot of reasons for this growth, one of the main reasons is that people are more comfortable visiting different destinations outside of their hometowns or countries.
This has led to an increase in demand for vacation rentals in far-flung areas, which in turn has created new opportunities for entrepreneurs in the industry. Some of the newer trends that are benefiting the industry include short-term rentals (which can be rented for as short as a few hours), VRBO (Vacation Rentals by Owners), and home sharing platforms like Airbnb.
Recent investment and developments in vacation rental market
- In July 2022, Dallas Cowboys Owner Jerry Jones invested undisclosed amount in a software company that deals in hotel and vacation rental business
- In July 2022, Here, a US based company, started pulling funding starting from $100 for owning a vacation rental properties. The company so far has secured a funding of over 5 million through seed round
- In July 2022, Planet, a global technology integrated software and payment services acquired Avantio, a vacation rental management software and services company and expanded its market reach in hospitality industry
- Andes STR, proptech start-up, to invest $25 million for buying family homes and put them on short term vacation rentals. In addition to this to, Andes STR and WEG Capital are planning to bring 80 more properties under their portfolio by 2026
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Players in Vacation Rental Market are Facing Challenges in Meeting Tightening Regulation, Changing Consumer Behavior and Oversupply
The vacation rental industry is poised for rapid growth as the popularity of short-term rentals increases. However, this growth comes with challenges and trends that should be aware of if you plan to participate in the market. Here are four key challenges to watch for:
Increased regulation: Municipalities are increasingly starting to regulate short-term rentals in an effort to control the number and type of properties on their streets. This has created challenges for companies operating in this space, as they need to comply with complex regulations.
Growing pains: Many companies in the global vacation rental have only launched their businesses in the past few years and holding a minimum market share, and as such, they are still learning how to navigate this new market. This can lead to errors and bumps in the road as they grow, which could damage their reputation and disrupt their business model.
Competition from Airbnb: Airbnb has become one of the most popular ways for people to find vacation rentals. As a result, companies that do not offer Airbnb rentals may find it difficult to compete. In fact, most of the travelers are more likely to avoid new platforms to due to lack of knowledge about safety, services, and trust.
Changing customer behavior: As people become more comfortable renting homes through platforms like Airbnb and VRBO, they are changing their expectations about vacation rentals. This means that companies that want to take advantage of this trend must spend a lot of money to continue delivering the products and services your customers want.
Oversupply: In major cities such as New York, San Francisco, and London, there is excess property for short-term rentals not being used for vacation rentals. This tends to drive up the price and make it difficult for companies offering vacation rental brands to increase their revenue.
Vacation Rental Market Analysis by SkyQuest Technology. Know How This Report Would Help You Make Informed Business Decisions
The future of the vacation rental industry looks very bright. With the growth of technology and the internet, people are able to book vacations much easier than ever before. This has led to an increase in luxury vacation rentals available for rent all around the world. Additionally, Airbnb has made it easy for anyone with a property to list their rental on their site, which has certainly helped contribute to this growth. With so many options available now for those looking for a vacation rental, there is no reason why the industry should not continue to grow at a rapid pace in the years to come.
A recent report published by SkyQuest Technology on vacation rental market can help players by providing them with information about what is happening in the market and how they can best position themselves. Moreover, the report can help a company understand how consumers are using its product, what features are selling well, and how changes in the market might affect its own business. This information is invaluable, as it would help players identify trends and understand how their competitors are doing. It also allows them to make informed decisions about their own businesses, which is crucial for any player in the market.
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Top Vendors in Vacation Rental Market
- Airbnb Inc.
- 9flats.com Pte Ltd.
- Wyndham Destinations Inc.
- Expedia Group Inc.
- MakeMyTrip Pvt. Ltd.
- Oravel Stays Pvt. Ltd.
- Booking Holdings Inc.
- Hotelplan Holding AG
- NOVASOL AS
- TripAdvisor Inc.
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