Vacation Rental Market Size
Hey! Last year, the vacation rental business was worth an incredible $99.6 billion. And you know what? Experts say that it will keep increasing, with a consistent 3% rise over the next five years. What is going on? It's all about the younger generation, like us Gen Z and millennials. We don't like the same things our parents did. We want to have true experiences that let us taste the local culture. When we travel, we want to feel like we're part of something bigger. Hotels are nice, but they all have the same things. On the other hand, vacation rentals can be any size or shape. There is a location out there that fits your personality and interests, whether you want a small cottage, a trendy loft, or an old villa. This makes it easier to feel like you're at home in the place you're visiting.
Online booking services have changed the way people book trips for the better, making it easier and more convenient. In the past, if you wanted to rent a vacation house, you had to look through ads or ask friends and relatives for suggestions. Now, vacationers can look through thousands of vacation homes throughout the world all in one place on the internet. This easy access has brought in a lot more people to the vacation rental industry, which has made the market as a whole bigger. Travelers can easily research, compare, and book the best vacation rental thanks to online booking platforms. The process is easy because of quick booking, safe payments, and easy-to-use interfaces. This simple experience makes it more probable that vacationers will choose vacation rentals over other possibilities.
| Report Attribute | Details |
|---|---|
| Base Year | 2023 |
| Vacation Rental Market Size in 2023 | USD 99.6 Billion |
| Forecast Period | 2024 - 2032 |
| Forecast Period 2024 - 2032 CAGR | 3% |
| 2032 Value Projection | USD 137.4 Billion |
| Historical Data for | 2021 - 2023 |
| No. of Pages | 260 |
| Tables, Charts & Figures | 300 |
| Segments covered | Property, Duration of stay, Booking Mode, Location, Pricing, Travelers |
| Growth Drivers |
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| Pitfalls & Challenges |
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Seasonal changes are a big problem for the global vacation rental business, which could restrict its expansion. Vacation rentals don't get as many reservations all year round as hotels do. During peak seasons, like summer or skiing, depending on where you live, there are more reservations and more money coming in.
But at off-peak times, property owners may have trouble filling their units and making money. Because of this, owners find it hard to plan and budget correctly, which could hurt their finances and even stop them from making improvements to their properties. It can be hard to find the appropriate price plan for dealing with fluctuations in the seasons. Prices that are too high at busy times could bring in more money, but they might also turn off some customers. On the other hand, lower prices during times when there aren't as many people around may attract tourists but not bring in enough money to cover costs.
Global Vacation Rental Market Trends
There have been big changes in technology in the global vacation rental business. 3D virtual tours let guests see a property before they rent it, which is a more immersive and realistic experience than still photos. This makes people more likely to book and creates trust. Smartphone apps that are easy to use make it easier to find, compare, and book vacation rentals while you're on the go. This takes into account the growing tendency of booking and browsing on mobile devices initially. Adding smart home features like keyless entry, smart thermostats, and voice-activated assistants makes it easier and less stressful for visitors.
Also, software technologies automate tasks like scheduling cleaning services, keeping an eye on visitor interactions, and sending automated communications. This saves property owners and managers a lot of time. This lets them grow their business and take care of more properties.
Global Vacation Rental Market Analysis
Quick trips were the most common type of travel in 2023, and they are only getting more popular. People are giving up extensive vacations in favor of shorter getaways and new experiences. It can be hard to take a long holiday when our lives are so busy and our money is limited. That's where short-term rentals come in to save the day. They give you a comfortable and handy somewhere to stay when you go on weekend getaways, city experiences, or last-minute trips. Compared to regular hotels, they're a great deal, especially for families or groups. You can save money by renting a vacation home instead of a hotel because they usually have more room and facilities for the same price. And if you share the expense with your trip mates, a short-term rental becomes even more affordable.
Living in the city is cool! Almost 3 out of 10 vacation rentals were booked in cities in 2023. That's because those who want to get away quickly are drawn to cities. There are a lot of things to see and do there, like museums, historical sites, busy nightlife, and great restaurants. Also, cities are where people work. So, if you need a place to sleep while you're on business, vacation rentals have more space and amenities than a regular hotel room. When people go on vacation or for work, it's not surprising that so many of them opt to remain in the middle of everything.
About 32% of the vacation rental industry is in Europe, making it a popular place to rent a place to stay. There is a lot of growth in this area in countries like France, Germany, the UK, and the Netherlands. Europe has long been a popular place for tourists because of its interesting history, lively cultures, and beautiful scenery. Millions of people come here every year, which makes there a lot of demand for all kinds of places to stay, including vacation rentals. Travelers may easily see diverse parts of Europe since its transportation networks are well-connected, it's easy to move between nations, and cities have good infrastructure. This makes it easier to do vacations with multiple stops, which is a great fit for the flexibility of vacation rentals.
There is a lot of domestic tourism in the U.S., and a lot of people travel within the country for fun. Vacation rentals are appealing to them since they want to have unique experiences and stay in bigger places than hotels. The sharing economy is a big part of American culture. People are more and more willing to rent out their homes or stay in vacation rentals instead of normal motels. Florida, California, and Hawaii are popular places to rent vacation homes because they have nice weather and are close to bodies of water.
Many Asian countries' economies are growing, which means that people have more money to spend on things like vacation rentals and travel. The growing middle class in countries like China and India is a large market group with higher travel aspirations. Vacation rentals are a wonderful option to regular hotels because they often have more space and amenities for less money. Thailand, Indonesia, and Vietnam are just a few of the Southeast Asian countries with beautiful scenery and rich cultural experiences that are bringing in more and more tourists from around the world. Vacation rentals help with this by offering a range of places to stay.
Vacation Rental Market Share
Airbnb, Booking Holdings Inc., and Expedia together hold more than 41% of the market for vacation rentals. Airbnb conducts focused marketing to get new hosts in high-demand areas and new markets. To get more people to stay with them, they advertise a wide selection of properties, including exotic places like treehouses, yurts, and luxury villas. Airbnb also has a lot of support and training programs for hosts to help them enhance the quality of their listings and the experiences of their guests.
Booking Holdings Inc. uses AI-powered search and booking engines to enhance accuracy and efficiency in the booking process. They continually upgrade their mobile app with features like instant booking confirmations, real-time customer support, and localized recommendations. Additionally, they leverage data analytics to create personalized marketing campaigns, targeting specific customer segments with tailored offers and promotions.
Vacation Rental Market Companies
Major players operating in the global vacation rental industry are
- Airbnb
- Booking Holdings Inc.
- Expedia
- OYO Vacation Homes
- RedAwning
- Sonder
- Stayz
- TripAdvisor
- TurnKey Vacation Rentals
- Vacasa
Vacation Rental Industry News
- In June 2024, OYO, the Indian hospitality company, launched its premium vacation home rental brand Belvilla in the UK. Belvilla by OYO offers short-term stays in prime locations across the country, including London, Milton Keynes, Birmingham, Sheffield, and Leeds. OYO partnered with high-end apartment rental management company SOJO, which operates more than 250 apartments in those cities, as well as properties in Manchester, Suffolk, Berkshire, and Southwest England.
- In May 2024, Munich-based vacation rental company Holidu acquired Clubrural, a portal for rural vacation rentals in Spain and Portugal. The acquisition aims to improve the experience for both hosts and guests. Hosts will benefit from a wider reach on the Holidu platform to attract more international customers, as well as Holidu's modern software and personalized local service.
This vacation rental market research report includes in-depth coverage of the industry, with estimates & forecast in terms of revenue (USD Million) from 2021 to 2032, for the following segments
Market, By Property
- Apartments
- Houses/Villas
- Cottages
- Resorts
- Others
Market, By Duration of Stay
- Short-term
- Medium term
- Long term
Market, By Booking Mode
- Online
- Offline
Market, By Location
- Beach
- Mountain
- Urban
- Theme parks
Market, By Pricing
- Economy
- Mid-range
- Luxury
- Ultra-luxury
Market, By Travelers
- Solo travelers
- Online
- Offline
- Couples
- Online
- Offline
- Families
- Online
- Offline
- Group
- Online
- Offline
The above information is provided for the following regions and countries
- North America
- U.S.
- Canada
- Europe
- UK
- Germany
- France
- Russia
- Italy
- Spain
- Rest of Europe
- Asia Pacific
- China
- India
- Japan
- South Korea
- ANZ
- Southeast Asia
- Rest of Asia Pacific
- Latin America
- Brazil
- Mexico
- Argentina
- Rest of Latin America
- MEA
- UAE
- South Africa
- Saudi Arabia
- Rest of MEA
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