Holiday rentals in the U.S. are proving to be an attractive venture in 2023. In the first three weeks of January, reservations made on Airbnb and Vrbo increased by 27% when compared to the same period last year, according to Key Data and the Vacation Rental Management Association. A total of 4,245,574 trips were booked, up from 3,332,605 trips in the first three weeks of 2022.
Melanie Brown, Executive Director of Data Insights at Key Data said, “January reservations are an important measure of traveller confidence because it indicates that consumers are booking well in advance for spring and summer trips. This early data is very promising for what 2023 holds in store for the industry.”
Across the pond, bookings in the UK were up 19% compared to January 2022.
Demand for holiday rentals peaked midway through the month in both countries. Reservations were also more likely to be made mid-week, with the lowest number of bookings made over the weekend.
The value of bookings rose 43% in the year to January, compared to 10.5% in the U.K. Hosts and property managers in the U.S. made just shy of $7 billion in total in the first three weeks of the year.
It seems the recession isn’t stopping travellers from booking holidays and staycations—but people are tightening their belts and cutting trips short. Data shows that in America there was a 4% decline in the length of stays in total. Ultimately, more people are booking vacation rentals, but they are booking fewer nights per trip.
A look back at the holiday rental market
Despite the pandemic, the U.S. holiday rentals market has gained significant speed over the past few years. In 2022, short-term rental market demand was up +21% compared to 2020, and +47% on 2019.
Staycations became the norm whilst travel restrictions were in place, and data shows that they have remained a top priority.
People are eager to make up for lost time when it comes to trips away, at home and overseas.
City stays, however, are yet to make a comeback. In October 2022 AirDNA, a resource for vacation rental research, revealed that short-term rental occupancy in coastal and mountain/lake areas was up more than 20% when compared to 2019, whilst in large urban cities, occupancy was still down by a fraction (4%).
U.S. holiday rentals are also proving to be an attractive choice in light of the cost-of-living crisis, as holidayers can save on eating out and other expenses.
AirDNA predicted that demand for holiday rentals will grow by 5% this year. However, recent data shows that the +20% growth in demand seen last year is riding over into 2023. Time will tell if the demand for short-stay accommodation will continue to exceed expectations.
Regardless, more people than ever are booking staycations and short trips away. A travel boom is already underway in 2023, with 41% of people from around the world planning to spend more on travel abroad this year.
This is very good news for those with investment properties which qualify as holiday rentals, particularly in the U.S. where demand is still soaring. Average daily rates are expected to increase, and cities are set to receive greater demand very soon.
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