Vacation Rental Statistics and Trends: Updated 2021

Vacation rental statistics show that trends have changed dramatically in the last year, so we wanted to uncover the truth about what’s really going on in the vacation rental space.

Our team has worked tirelessly to assemble and verify the most up-to-date statistics to inform short-term rental property managers about what’s happening and what’s to come.

In this article, we’ll look at some of the vacation rental statistics, and how property managers can adapt in 2021 and beyond.

Key vacation rental trends 2021

The pandemic changed many aspects of daily life, with travel affected more than most.

Here’s what we’ve learned from looking at the vacation rental statistics of the past year:

Travel patterns have changed. People stay closer to home for family getaways in rural locations, and some bring work with them.
Guests and property managers alike value technology that creates seamless, contactless experiences.
Property managers want to invest cautiously in technology that helps increase profit margins.
Though uncertainty continues, the appetite for travel is stronger than ever. Diversifying your portfolio is essential for maximizing bookings and revenue.

Table of contents

Vacation rentals fare better than hotels
People are eager to travel again
Uncertainty will continue
Family travel
Rural vacation rentals
The rise of “Staycations”
…and “Flexcations”
Guests care about cleanliness
Diversification is key
Demand for flexibility
Preventative technology
Automation
Contactless technology
More cost-effective tech solutions
Direct bookings
Conclusion
References

Vacation Rental Statistics and Trends

Now we’ll take an in-depth look at rising trends and surprising vacation rental statistics in 2021.

1.Vacation rentals fare better than hotels

Experts predicted that the vacation rental market would reach USD 87.61 billion in 2020, but the pandemic has thrown these predictions off track. [1]

However, market data shows that vacation rentals weathered the storm better than hotels. During the lowest point, occupancy of short-term rentals with 2 or more bedrooms declined by 46.2%. Hotels suffered a decline of 77.3% for the same period. [2]

2. People are eager to travel again

People were stuck at home for the majority of 2020, and many had trips canceled. This didn’t stop them from dreaming about travel, though.

A study surveying over 8,000 people from 8 countries found that:

82% of families surveyed were still planning future trips.
1 in 3 families planned to spend more, travel further, and stay longer in 2021.
Guests increasingly sought more luxurious accommodation.
21% of people cited mental health benefits and self-care as a motivation for travel. [3]
69% of tourists plan to travel sustainably in 2023

Vacation rental statistics from Vrbo trend report

Source: Vrbo trend report 2021

In the US, 88% of survey respondents planned to travel in 2021, regardless of coronavirus restrictions. [4]

Clearly, restrictions have only increased the desire to travel in the future. Property managers can take advantage of this by encouraging advance bookings in luxury destinations, so guests can plan grand trips with more peace of mind.

3. Uncertainty will continue

There is no clear roadmap back to normality. Restrictions come and go, and countries progress at different rates. New barriers to travel continue to appear, such as mandatory tests, quarantine, and vaccine passports.

This uncertainty will make it difficult for property managers in the vacation rental market to set their prices. Many agencies use dynamic pricing tools to ensure they always have the ideal price at any given time. However, these tools, which rely on historical data, may not be as reliable as usual.

The pandemic disrupted normal seasonality trends, and surprisingly, average rates actually grew slightly in 2020 by 4%-6%. [5]

Agencies must adapt their pricing to fit fluctuating occupancy rates and be aware of constantly changing restrictions. We have highlighted some key ways on how to increase occcupancy rates.

4. Family travel

After many months spent in isolation, people are looking to reunite with their family and loved ones.

31% of travelers said spending quality time with family was their main motivation for travel. [3]
42% of travelers planned to travel as a family group. [4]
38% of property managers surveyed said they’d noticed more bookings from family groups. [4]
Larger homes suitable for families performed better in the vacation rental market. [5]

Family groups are often multi-generational and they want to stay in large, private properties. They also often want to bring the family pet along for the trip.

To take advantage of this trend, agencies need to offer bigger homes and make their accommodation pet-friendly.

5. Rural vacation rentals

In the early days of the pandemic, we were shocked to see the deserted streets of usually crowded cities like New York, Venice, and Barcelona.

The impact of the crisis was more visible in cities, and many dreamed of escaping to the countryside.

Remote areas feel safer and infection rates are generally lower, and this was reflected in booking trends.

In Europe, 9 out of 10 guests preferred rural vacation homes. [4] Studies in the US showed that 61% of families were more likely to visit an outdoorsy destination than an urban one. [5] The popularity of countryside cabins increased by 25% and people sought to be near lakes and rivers. [3]

This preference for nature over cities looks likely to continue. Agencies that can offer rural vacation rental properties will attract more guests in the coming months.

6. The rise of “Staycations”

People are reluctant to plan trips abroad without knowing whether their flights will get off the ground.

Closer-to-home destinations that travelers can drive to seem less risky.

59% of US travelers said they were more likely to drive than fly to their next destination, along with 71% of German, and 68% of Spanish travelers. [3] [4]

People are rediscovering their own countries. Property managers must appeal to local tourists as well as foreign travelers.

7. …and “Flexcations”

Flexcation is a 2020 buzzword describing the rising trend of guests who want to mix work and play.

Last year, many people started working from home for the first time, and this gave them the freedom to combine travel and work.

57% of property managers said they noticed more bookings from guests intending to work during their stay, and 43% of property managers said guests booked longer stays. [4]

A survey of guests who had booked flexcations found that:

1 in 3 had been able to travel thanks to remote work.
38% had booked flexcations to offer their children a new experience and break the monotony of staying at home.
67% said they would be likely to do it again. [3]

Vacation Rental Statistics show that industry will see more of these travelers. To attract them, vacation homes need good quality internet and comfortable desk space. Agencies should advertise these features in their listings.

You can also consider concentrating on longer stays rather than weekend breaks. Research showed that the percentage of longer stays (over 7 days) has doubled since 2019. [5] Among European travelers, average stay length increased by 190%. [4]

8. Guests care about cleanliness

Hygiene became a priority during 2020, as mask-wearing, regular hand-washing, and disinfecting of surfaces became normal practice. Cleaning practices also became more important to vacation rental guests.

vacation rental statistic on cleanliness ratings and occupancy

Source: Airdna Report

Throughout 2020, high cleanliness ratings correlated with higher occupancy rates. [5]

Strict cleaning practices give renters peace of mind. It’s a good time to introduce stringent, hotel-style cleaning measures and to promote these practices on your listings.

You can also factor this into your prices. Although 91% of vacation rental managers highlighted Covid-related cleaning measures in their listings, 81% did not reflect these measures in their prices. [4]

9. Vacation Rental Statistics show diversification is key

In a difficult market, diversification is key to capturing as much business as possible and maximizing vacation rental revenue. As well as major OTAs, property managers need to list properties on specialist and niche vacation rental sites.

This helps appeal to a broader range of travelers like the family groups and working travelers we mentioned previously.

52% of property managers have diversified their revenue channels over the past year, and 91% are interested in listing on another OTA. [4]

10. Demand for flexibility

Because of continuing uncertainty, guests expect more flexibility when making bookings.

People are more likely to book if they know they’re able to cancel or reschedule because of unforeseen circumstances.

90% of European property managers said they’d made their cancellation policies more flexible. 52% were even planning to offer free cancellation in 2021. [4]

To stay competitive, property managers may have to relax cancellation policies. This could mean giving guests the option to reschedule or cancel at the last minute for little or no extra cost.

You’ll also need to be prepared for more last-minute bookings. According to a survey, 90% of property managers had noticed an increase in last-minute bookings. Airbnb stated that the percentage of last-minute bookings had doubled, and recommended turning on Instant Book to make the most of this. [6]

11. Preventative technology

Illegal house parties that broke Covid-19 restrictions attracted bad publicity for the vacation rentals industry in 2020.

Noise monitoring company Noiseaware reported that noise incidents at vacation rentals grew by 270% from April to July 2020 compared with 2019. [7]

As well as breaking local laws, parties are a nightmare for property management companies. They are left to pick up the pieces, dealing with damaged property and strained community relationships.

Preventative technology can help you avoid these kinds of situations. Noise detectors and occupancy sensors will likely become more popular in the short-term rentals industry.

12. Vacation Rental Statistics and automation

Vacation rental statistics show another industry trend that’s set to continue is the move towards automation.

Property managers realize that automating business operations helps save time and money.

85.9% of vacation rental companies and hoteliers surveyed by Operto said that automation was a priority for them in the next couple of years. [8]

Statistics about automation in short-term rentals industry

Source: Operto white paper

By automating repetitive work, agencies can free up more time to grow their business and offer clients a better service.

13. Contactless technology

Contactless technology will continue to gain popularity in 2021 and beyond.

Vacation rental property managers understand that more and more guests appreciate contactless technology such as keyless entry.

Vacation rental data about keyless technology

Source: Operto white paper

Vacation rental statistics from Operto’s white paper found that 82.4% of vacation rental property managers would consider implementing keyless technology in the near future. [8]

In the same survey, property managers predicted that contactless check-in, keyless entry, and smart home devices would become popular in the coming years.

Most important technologies for property managers

Source: Operto white paper

Guests value these tech solutions because they cut face-to-face contact and provide a smoother experience. More than half of property managers surveyed believe that guests view contactless technology as either essential or expected.

Property management companies should consider adopting online check-in and other innovative, contactless tools to provide guests a more positive experience.

14. More cost-effective tech solutions

While property managers know the benefits of new technology, they are cautious about big expenses after a tough year.

Operto found that 34% of property managers were planning to invest 11-25% more than currently on tech. [8]

Property managers want to reduce their outgoings. Tech solutions that include various vacation rental management software tools in one, including PMS, vacation rental channel manager, website builder, guest messaging, and more are a great option.

An all-in-one solution like Avantio can simplify your workflow and cut down your spending on lots of separate tools.

15. Direct bookings

Property managers can increase profit margins by focussing on getting more direct bookings.

Source: VRM Intel

When guests book directly, short-term rental agencies earn more money as they don’t have to pay OTA fees and commissions. According to data from VRM Intel, direct bookings accounted for over 50% of bookings in 2020. [9]

To maximize the chances of direct bookings, an attractive, user-friendly website is essential. You don’t need to pay thousands for web design, though. Avantio has a dedicated team of web design experts. We can build a beautiful, customized, SEO-friendly website that will help your agency get more direct bookings.

What do Vacation Rental Statistics show us?

Vacation rental statistics show that, while people are eager to travel again, things will remain uncertain for a while.

As soon as normality returns, recovery for the vacation rental industry looks promising. In the meantime, property managers will have to adapt to survive in a difficult market.