Summer is shaping up to be a busy one for the short-term rental market, especially in metropolitan areas that have taken the longest to recover since the epidemic.
All but two of the 20 main areas studied by AirDNA LLC, an analytics firm that records short-term rental data, are experiencing an increase in demand beginning in summer 2021. Meanwhile, the average daily rate, or ADR, in each of those 20 markets is rising on an annual basis.
Miami and New Orleans are the only two areas among the 20 studied that have seen a 2.1 percent and 1% reduction in demand from last summer, respectively. However, due to fewer pandemic government regulations throughout the Southeast during the epidemic and their prominence as leisure destinations, those two regions have had a better-than-average resurgence since 2020.
Meanwhile, major gateway markets that have struggled disproportionately are expected to recoup the most this summer.
large U.S. cities were still down 40% to 50% last year from pre-pandemic levels. More ground is being made up this summer, with New York seeing 73.9% uptick in demand; Washington, D.C., seeing a 71.5% surge; and Philadelphia at 67.6%.
Airbnb, one of the most popular short-term rental sites, reported a 32% increase in gross nights booked in the first quarter compared to Q1 2019. During the company’s earnings call on May 4, co-founder and CEO Brian Chesky stated that the flexibility of remote work has been one factor leading to increasing Airbnb bookings.
While domestic travel, notably to rural areas, continues to see visitors, he also stated that there has been a return to cities and cross-border travel this year at or above pre-pandemic levels in 2022.
So, is investing in a short – term rental worth it in this day and age? It can be.
It’s no secret that the short-term rental industry is booming right now. Travel demand is stronger than ever, yet many individuals are seeking different experiences than we were only a few years ago.
Guests may stay a little longer and discover a little more if they can work from home. Private vacations in less congested places with a home-away-from-home atmosphere are appealing to today’s vacationers.
Vacation rentals are quite lucrative. Of course, there are many variables to consider, such as location, property upkeep, and upfront fees, but overall, short-term leases outperform long-term leases.
When comparing two comparable homes in the same region, a short-term rental will often generate two to three times the rental revenue as a standard yearlong rental. Furthermore, holiday rentals provide additional possibilities to update the rental price, making them an excellent inflation hedge.