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Year-End Review for Short-Term Rental Industry
It’s clear to everyone that the COVID-19 pandemic has affected travel in unprecedented ways. Some hosts have struggled to maintain their businesses this year, while others in different parts of the country have enjoyed renewed success as restrictions have shifted throughout the course of 2020.
Guesty has surveyed over 400 vacation rental owners to discover just how the pandemic has affected bookings throughout the year and has released their findings in their “Industry Report: State of the Short-Term Rental Industry Amid COVID-19.”
Here are 5 of the most important takeaways for vacation rental hosts and the STR industry as a whole.
1. Travel is more spontaneous.
As the news about the pandemic seems to change every day, it’s becoming more difficult for people to make long-term plans. As such, last-minute bookings have become the norm. According to the hosts surveyed, 30% of reservations were made within 30 days of a stay, 40% of reservations were made within one week, and 15% were made the same day.
2. Families are looking for space.
Lockdown has forced many families to cut back on their usual activities, which can be particularly hard on young children – especially if a family doesn’t have an adequate outdoor space for kids to run around and play at home.
Because of this, vacation rentals with large yards have seen a jump in popularity. If your property has a great outdoor space, be sure to highlight this in your listing to attract guests who are looking for a little more space.
3. Digital nomads are thriving.
With many companies switching to full-time remote work, employees are free to work from anywhere with a reliable wi-fi connection. Because of this, rental hosts have seen an increase in extended stays, with the majority being around 1-3 months in length.
Earlier in the year, many travelers were looking to escape the city, so hosts in remote areas were more likely to see this type of extended stay. However, as the pandemic stretches on, people have begun booking stays in larger cities once again, so many hosts can capitalize on this demographic.
4. Flexible cancellation can help.
In the spring and summer, there was a rise in emergency cancellations, as COVID-19 restrictions progressed at a different pace everywhere around the world. Today, according to the report, the majority of cancellations occur 2-3 weeks before a trip, which is a significant improvement.
While those last-minute cancellations have tapered off, a flexible cancellation policy is likely to make guests feel more comfortable when booking their stay, especially as cases are on the rise in the United States. 22% of the hosts surveyed in the industry report have found that flexible cancellation was the most helpful strategy for their business in 2020.
5. Expect more bookings, but also more cancellations.
Many travelers feel more comfortable booking an Airbnb than staying in a hotel. Guests report feeling safer in an Airbnb, as there are fewer common areas and shared surfaces, fewer people, and less guest turnover than in hotels.
Because of this, travelers who would normally stay in a hotel for the holidays may book Airbnbs instead. However, COVID-19 is expected to spike after Thanksgiving. If regulations surrounding health and safety become more strict, more guests are likely to cancel their stays and decide not to travel at all for Christmas and New Year’s.
While travel has changed beyond what we could have expected in 2020, it’s clear that many vacation rental owners are still seeing a level of success. The important thing is to understand the shifting trends and make adjustments to your business strategy accordingly.