Vacation Rental Market Analysis, COVID-19 Impact,Outlook, Opportunities, Size, Share Forecast and Supply Demand 2021-2027|Trusted Business Insights

Trusted Business Insights answers what are the scenarios for growth and recovery and whether there will be any lasting structural impact from the unfolding crisis for the Vacation Rental market.

Trusted Business Insights presents an updated and Latest Study on Vacation Rental Market 2020-2029. The report contains market predictions related to market size, revenue, production, CAGR, Consumption, gross margin, price, and other substantial factors. While emphasizing the key driving and restraining forces for this market, the report also offers a complete study of the future trends and developments of the market. The report further elaborates on the micro and macroeconomic aspects including the socio-political landscape that is anticipated to shape the demand of the Vacation Rental market during the forecast period (2020-2029).
It also examines the role of the leading market players involved in the industry including their corporate overview, financial summary, and SWOT analysis.

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Report Overview: Vacation Rental Market

The global vacation rental market size was valued at USD 76.08 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 2.3% from 2021 to 2027. Millennials are the major force in boosting the growth of the vacation rental industry. Rising spending on travel, vacations, and accommodation among this generation is fueling the market growth. As per the report published by Airbnb, millennials and younger generations will account for 75% of all consumers and travelers by 2025. Travelers in the market are more inclined towards vacation rental property over hotels owing to the comfort, low cost, additional privacy, and kids and pet friendly nature of the accommodation. In addition, a lot of rental properties accept pets and offer fence in the back yard with an additional fees or security deposit, which serves as an appealing feature for the consumers. Low cost as compared to hotel accommodation with similar amenities compels the consumers to opt for vacation rental property. As per the TurnKey Vacation Rentals survey, 65% of millennial travelers ranked cost as the most important factor in choosing a vacation rental.

As per the report of iPropertyManagement, 71% of travelers with children preferred access to cooking their own meals, which was a major reason boosting the preference for vacation rental. As per Vacation Rental Marketing, the average number of Airbnb units is said to be doubling year on year, whereas hotel supply increased by only 1.1% in 2018. Moreover, according to CRBE, Airbnb accommodations account for 9% of the total lodging units in the 10 largest U.S. markets and are adding units at a substantially faster rate than the U.S. hotel industry.

The influence of social media and the internet is increasing awareness among consumers regarding services and offerings of the vacation rental. Key players are increasing their reach among consumers via advertisement and marketing in online articles, blogs, and social media platforms. Key players are offering various services and exotic locations with exotic landscaping and amenities. Many players are focusing on gaining market share by offering services dedicatedly to female travelers. For instance, in January 2020, Golightly, Inc. launched accommodation managed by women and only available for female guests, although men can travel with the member. Company owned more than 350 properties across the globe.

Fake listing of apartments, condos, and homes is acting as a restraint for market growth. Moreover, the growing pandemic of coronavirus (COVID-19) since December 2019 started impacting the growth of the market for vacation rental. As per AirDNA, changes in weekly bookings between the beginning of January and March have witnessed a significant drop. For instance, in Beijing, the number of bookings dropped by 96%, Shanghai by 71%, Seoul by 46%, and Rome by 41%. The impact is hampering the growth of the markets, which are largely limited to where the virus actually is.

Accommodation Type Insights: Vacation Rental Market

In terms of revenue, the home accommodation type lead the market for vacation rental with a share of 47.2% in 2019. This is attributed to the high popularity of home among travelers owing to its space availability, safety, and access to amenities. Moreover, the low cost of accommodation in rural and travel destinations is acting as a major factor for the growth of the segment.

Resort/Condominium is estimated to be the fastest growing segment over the forecast period 2021-2027. The growth is majorly attributed to increased inclination of the millennials towards spending on experiencing luxury. According to iPropertyManagement, 12% of millennials plan to stay in a villa/estate in the next year vs. only 6% of Boomers and 9% of Gen Xers. Availability of various facilities such as function rooms, barbeque pits, games, KTV and multi-purpose rooms, clubhouses, tennis, squash and basketball courts, and swimming pools fuels the growth of this category. The others segment including farm stays, cabins, chalets, and glamping accommodations is projected to expand at a CAGR of 1.5% over the forecast period.

Booking Mode Insights: Vacation Rental Market

In terms of revenue, the offline booking mode lead the market for vacation rental with a share of 71.2% in 2019. This is attributed to the high preference for offline mode of booking among baby boomers and Gen X, which form the major consumer base. Increasing penetration of the internet and smartphone among consumers is estimated to shift consumers inclination towards online booking mode.

Online booking mode is estimated to expand at the fastest CAGR of 3.2% over the forecast period. The growth is attributed to consumers preference to have detailed access to the offerings of accommodation, amenities, and other benefits. Value for money, convenience, and search for authentic travel experiences are major factors fueling the growth of online booking. Increasing number of startups and third party travel booking companies are offering services via application and website only. Hence, consumers are shifting their preferences from offline booking mode to online. These aforementioned factors are boosting the growth of online booking mode.

Regional Insights: Vacation Rental Market

Europe lead the market for vacation rental with a share of 35.9% in 2019. This is attributed to the leading tour operators and online tour operators catching up with the growing trend of glamping and rising spending on booking accommodation in resort and condominium. Germany and the U.K. are estimated to lead the market over the forecast period. The U.K. is projected to be the fastest growing market in the region.

The Asia Pacific is estimated to be the fastest growing regional market for vacation rental and is further anticipated to take over the share of Europe by 2027. The growth is majorly attributed to the rising spending of the consumers on traveling and accommodation. China is a major contributor to the regional market growth and the country accounted for over 40.0% share in 2019. Rising spending of travelers from other developing countries, such as India, Philippines, Vietnam, and Australia, is further estimated to support the market growth in the region.

Key Companies & Market Share Insights: Vacation Rental Market

Many leading players are increasing their focus towards the growing trend of the vacation rental. Players in the market are diversifying the service offering in order to maintain market share. For instance, in April 2019, Marriott International announced the launch of Homes & Villas by Marriott International, a home rental initiative offering 2,000 premium and luxury homes located in over 100 destinations throughout United States, Europe, Caribbean, and Latin America. This is estimated to create tough competition in the market for vacation rental. Some of the prominent players in the vacation rental market include:

Key companies Profiled: Vacation Rental Market Report

This report forecasts revenue growth at the global, regional, and country levels and provides an analysis on the latest industry trends and opportunities in each of the sub-segments from 2016 to 2027. For the purpose of this study, Trusted Business Insights has segmented the global vacation rental market report on the basis of accommodation type, booking mode, and region:

Accommodation Type Outlook (Revenue, USD Million, 2016 – 2027)

  • Home
  • Apartments
  • Resort/Condominium
  • Others

Booking Mode Outlook (Revenue, USD Million, 2016 – 2027)

  • Online
  • Offline

 

Looking for more? Check out our repository for all available reports on Vacation Rental in related sectors.

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