On The Market

Short-Term Rental Demand Returns, So Why Are Hosts Making Less? w/AirDNA Chief Economist Jamie Lane

Aug 12, 2024

Jamie Lane, Chief Economist at AirDNA, dives into the shifting landscape of short-term rentals. He discusses the unexpected stability in the market, countering fears of an ‘Airbnbust.’ Despite rising demand, hosts are seeing lower revenues. Lane highlights growth potential in certain markets and points out oversupsupplied areas losing traction. He shares strategies for increasing bookings through enticing amenities and pricing adjustments, while also shedding light on the booming European vacation rental scene.

44:49

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Episode guests

Jamie Lane

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Episode notes

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Quick takeaways

The short-term rental market is stabilizing post-pandemic with varying demand trends, particularly impacting lower-tier properties under $125 per night.

Emerging opportunities exist for investors in mid-sized cities with lower hotel supply, contrasting with declines in traditional vacation rental destinations.

Deep dives

Current State of the Short-Term Rental Market

The short-term rental market is currently experiencing a phase of stabilization after the fluctuations seen during the pandemic. Occupancy levels have remained relatively flat, with demand showing steady growth compared to prior years. Average Daily Rates (ADR) have also stabilized, suggesting that hosts are earning similar amounts now as they did in 2023, though earnings are lower than the peaks of 2021 and 2022. This situation indicates that while the market is not in a crisis, the unprecedented growth seen during the pandemic is normalizing.

Intro

2min

Equilibrium in the Short-Term Rental Market

7min

Emerging Patterns in Short-Term Rental Demand

4min

Navigating the Short-Term Rental Landscape

11min

Boosting Short-Term Rental Appeal

6min

Navigating Short-Term Rental Pricing

12min

Navigating Market Changes and Seeking Investor-Friendly Agents

2min

A couple of years ago, everyone was expecting an “Airbnbust,” where short-term rental investments would sit vacant, hosts would be forced to sell, and hotels would take the reigns as the leaders in hospitality. But that didn’t (exactly) happen. Instead, we got a slightly slower short-term rental market with fewer bookings, some more supply, and a slight dip in revenue for hosts. The short-term rental market is now reaching “equilibrium,” and demand is returning. So, what do hosts need to know now?

Jamie Lane from AirDNA, the leading global short-term rental data and analytics company that tracks every listing on the market, is here to give us a mid-year update. Jamie talks about how the short-term rental market is returning to normal, why demand is starting to shoot back up all while prices are dropping, and the “cracks in the system” that could point to future short-term rental weakness.

He points out the short-term rental markets with the most growth potential, the oversupplied ones seeing drops in demand, and why the European Airbnb scene, even with its regulations, is exploding. Plus, he’ll share the amenities and policy changes you can make NOW to get more bookings and what to look for BEFORE you buy in a new market.

In This Episode We Cover

A 2024 short-term rental market update (supply, demand, pricing, and threats)

The short-term rentals seeing the least demand, and why this may be worrying for hosts

“Fringe” markets that are performing even better than the traditionally popular markets

Why hosts are seeing a drop in revenue and the markets with weak demand

International travelers returning and the minor tweaks you can make to get more bookings

Jamie’s forecast for the rest of the year and why he predicts demand will rise this fall

And So Much More!

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