How Short Term Rentals Have Changed in 2020
The last few months have transformed the way we work and go about our daily lives. Airbnb and short-term rentals have been no exception. After the initial shakeup, we started seeing some shift in customer behaviour and in turn, new trends. Let’s go over them, one by one.
New guests brought new use cases
Short-term rentals have always catered to a broader pool of people looking for flexible accommodation. For example, since more and more employers transition to remote work policies, many have started to seek alternative arrangements, especially in scenic areas. More time at home also resulted in an upswing in renovations and families turn to Airbnb for temporary lodgings. Relocators or those who are checking out new neighbourhoods within the area before deciding if they should move or not are also among those who book Airbnbs.
These groups have always been part of the Airbnb demand. Short-term rental management companies, like Hometime, have noticed that these groups have become more prominent over the last couple of months as people’s priorities have changed. We expect these trends to continue in combination with the surge in local travel, especially towards the end of the year.
The initial drop was followed by a surge
US data for Airbnb online searches according to Google TrendsDue to the pent-up demand for travel, Airbnb bookings have increased once more after the initial lifting on domestic travel restrictions. In fact, the company said that gross booking value grew in year-over-year terms over the weekend of June 5–7 in the United States for the first time since February 2020.
As lockdown policies continue to ease, interest in Airbnb has bounced back in the US, steadily rising from May to June and returning to pre-COVID-19 levels as suggested by online searches for it on Google.
The alternative has taken over the traditional
Not long ago, a great holiday was about spending time in a large resort full of people. However, with crowded places now posing more risks, people started looking for alternative, more exclusive getaways.Homelike accommodations with pools, balconies, and private outdoor spaces offer better opportunities for guests to enjoy their stay with close friends and family, without having to worry about increasing their risk of exposure. This trend has been developing for years but accelerated significantly over the last couple of months.
Active management has become more crucial
These days you can’t just photograph your place, put up a listing on Airbnb, and leave it at that — at least not if you want solid booking yields. The last 2 months have shown the large difference between active professional yield and passive pricing set up on Airbnb and alternative platforms. In some cases, professionally managed Airbnbs outperformed the market by 2–3 times.
This has happened because changing market conditions and evolving customer segments required deep understanding of market trends, access to large data sets and yield management professionals. We expect this trend to continue.
Cleanliness has been brought to the forefront
Airbnb has recently introduced a new enhanced cleaning protocol and hosts who follow get the special call-out badge. While cleanliness has always been one of the most important priorities for any Airbnb host, now more than ever, it’s become imperative that this message is clearly communicated to potential guests. We also noticed in our data that guests are actively seeking places with high cleanliness reviews and are cautious to book places where such standard is not clearly shown regardless of their pricing or any discounts offered.
Thriving in today’s economic climate is all about tailoring your business strategy to the new normal. In the short-term rental market industry, this means anticipating, preparing, and easing any concerns that your potential guests may have.