Landlords checking inventory out of short-term vacation rental sector
When asked to give an assessment of the short-term vacation rental sector, the specialist explained “the overall theme is that of indecision by governments”. In the wake of COVID-19 lockdowns, “demand has completely collapsed” and as a result it looks like there’ll be “significant retrenchment” of inventory swept from platforms.
Property in rural and urban areas will be affected differently. Rentals in cities will be harder hit, whereas those in the countryside “may see a faster rebound, but by no means to the levels we’ve seen in 2019”. A number of European short-let HMCs are “highly dependent” on cities, and it’s unclear how many will have the resources to weather the storm.
Another important factor is landlord portfolios. Although full-time landlords prior to the pandemic would have provided better commission, the companies that focused on these are now facing a drop in supply as these properties are put on the market for long-term rents.
Supply and demand dynamics were also on the agenda. The specialist believes that the average daily rate will go down overall, while owners of premium properties will seek rate hikes. The rationale behind this is that they could only secure one or two weekend stays, but a higher rate could even out the lower volume.
As HMCs are a significant driver of traffic to short-term vacation let platforms, the question of strategies to keep them on board arose. “I think an Airbnb will do something for hosts, I don’t think Booking will. Booking doesn’t have that community relationship with hosts and HMCs.”
To access all the human insights from Third Bridge Forum’s Airbnb & the Short-term Vacation Rental Management Industry Interview, click here to view the full transcript.
The information used in compiling this document has been obtained by Third Bridge from experts participating in Forum Interviews. Third Bridge does not warrant the accuracy of the information and has not independently verified it. It should not be regarded as a trade recommendation or form the basis of any investment decision.
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