Vacation Rental Market Growing
Carrie Hill | 30 October 2008 | 41 Reviews »
I read about a new PhoCusWright study today over at HotelMarketing.com that outlines a dramatic growth in the vacation rental market.
The study, “Vacation Rental Marketplace: Poised for Change” (purchased report) reveals that the current 2.8 billion in online booking of vacation rentals is 12% of overall vacation rental revenue – and is expected to grow by 17% by 2010.
As someone who prefers vacation rentals, the amenities to cost benefits are astounding and it’s apparent more of the market is catching on. I love having a kitchen and a washer and dryer when we’re on vacation. I have kids – both are messy and picky – so when I can make them breakfast or lunch they’ll eat – and keep them in clean clothes without packing two weeks worth – it’s completely worth not having an elevator or on-site restaurant.
“12% of vacation rentals were booked online in 2007 compared to over half of all leisure travel that was booked online, so there’s a tremendous long-term upside to this market, many consumers are frustrated by the difficulty of finding the right property, overcoming issues like a minimum required length of stay, and booking through a company they can trust. Companies that can help consumers overcome these issues will be best positioned to capture this opportunity”
Douglas Quinby, Senior Director, Research, PhoCusWright
Play up the benefits of a vacation rental over a plain hotel room in your marketing efforts:
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Emphasize per-night pricing even if you have a minimum stay
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Consider making your minimum stays as short as possible. The article indicates that 60 percent of vacation-rental stays are for fewer than seven nights!
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Play up the convenience of the kitchen and the laundry
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Multiple bathrooms are a huge deal when you’re traveling with teens
Offering great deals with vacation rental benefits can help bring more converts to the industry. People dont perceive a “deal” as getting something cheaper, they want VALUE for their dollar. So beyond offering all of the great amenities of a vacation rental – add something small but beneficial onto their stay.
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Gas cards for those driving to your destination – many people are choosing to vacation closer to home with the current economy – and a kickback on the gas it takes to get there is always welcome
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Grocery store gift cards are neat for getting the fridge stocked with staples and goodies for their stay
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A comprehensive in-unit list of restaurants, activities & attractins in the area. I stayed in a condo in Orlando and they had some Disney brochures right in the room for us when we checked-in. We were able to plan the next day that evening without having to go find info on how to get there, when they opened or what to bring.
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Stock some staples in the units if they’re used enough. I would love to check in and see coffee, filters, laundry detergent, fabric softener, dish detergent and soaps in the unit so I dont have to get that first thing after I walk in the door – or remember to do it after a long day of sight-seeing the next day
Let folks find the same information they’re looking for when booking a hotel. Reviews are key to this step.
The online vacation rental market is growing – there is room for expansion on almost every level. Making sure you’re playing the game and growing your competitive market share should be your primary objective right now. Blizzard is poised to help you wether the economic storm and come out on the other site ahead of the competitor that cuts marketing. Give us a call if you’re ready to take the next step!
Sunset image courtesy Eldar_
October 30th, 2008 at 2:41 pm
Those are excellent suggestions. I definately prefer staying in Vacation Rentals myself.
October 31st, 2008 at 5:27 am
Vacation Rentals are definitely a cheap alternative to Hotels. With this year’s economic crisis vacation Rentals will be the only alternative for the average Joe to go on Vacation.
October 31st, 2008 at 8:33 am
This is an interesting and informative post. Thanks for sharing . Hope to see your new posts soon.
October 31st, 2008 at 11:24 am
With the comfort and facilities provided by vacation rental,I think it will overcome hotel booking as mobile phone has overtaken land line phone.
October 31st, 2008 at 11:47 pm
Some good points Carrie. I just got back from a trip to the bay of islands here in beautiful New Zealand. The batch we rented had some really nice touches, like a stereo with a few CDs, and a cable to plug in my mp3 player. A certain standard is expected, and wont drive too much satisfaction but nail the small details and you’ll leave with happy customers.
November 1st, 2008 at 11:07 am
I have always been interested in Vacation Rentals as a side income. My wife and I always wanted to buy a home in Florida for rental as well as for holidays. I just wonder if we have missed the boat a bit as Florida is probably not as lucrative as it may once have been
November 4th, 2008 at 10:00 pm
I would have to agree. I’m in Orlando and have some contacts for european clients that are setting up vacation rentals near Disney. Definitely a growing trend IMO.
November 5th, 2008 at 4:30 pm
Great post! A 17% increase over the next few years is considerable and makes me want to look more into the entire vacation rental option.
Thanks
November 6th, 2008 at 2:38 am
Its an informative post.
Hope to see your new posts soon.
November 6th, 2008 at 4:04 am
I know my Aunt has a couple of vacation rentals at least 2 if I am not mistaken in Mandura, Western Australia and they earn quite a bit from it. They also sometimes use it as “their” holiday home.
November 6th, 2008 at 8:36 am
Vacation rentals are a growing market in Europe also. I am currectly working on a old farm house to use as a vacation rental. I personaly alway use vacation rentals because of the caost and flexability.
November 6th, 2008 at 2:26 pm
I agree. Great questions!! I love staying is vacation rentals!
November 6th, 2008 at 10:00 pm
This post make me interested to have my own vacation rentals. I can use it on holiday and it can be a side income too. Nice option to invest.
November 7th, 2008 at 12:16 am
I am a broker in Boise and the real estate here is hurting like the rest of the country, but there seems to always be a market for vacation rentals.
November 8th, 2008 at 12:18 pm
thanks for sharing!! very informative and interesting post.
keep posting!
November 8th, 2008 at 2:33 pm
The front page of yahoo had an article about renting out your vacation home, so I suppose this is a timely topic.
While I don’t own a home that I can rent out, I certainly prefer staying at vacation rentals and online is always my first stop (and often my final one) when I am looking to book a vacation. It amazes me how some companies or individuals will skimp on pictures or details.
November 9th, 2008 at 8:08 am
Thanks for very interesting posts. I can’t wait to your next posts. Keep good writing!
November 9th, 2008 at 9:19 pm
I couldn’t have said it better. This is definitely a niche worth looking in to.
And I agree that cheap is old news, people want value for what they pay.
November 12th, 2008 at 10:28 am
We love vacation rentals! We much prefer them to hotels wherever we go. They are usually much cheaper, cleaner and you feel at “home”. Plus, we save money by cooking a lot of the meals instead of eating out all the time. (With 3 kids, this will save you a lot).
We have recently started looking to buy a home in a vacation area that we could use and rent out.
November 13th, 2008 at 1:47 am
i travel 2 and 3 month per year.and i love vacation rental as well, it’s cheap.safe.and clean.
November 14th, 2008 at 5:12 am
The news of Homeaway raising $250 million this week validates the future potential of the vacation rental market. Homeaway purchased web sites like VRBO, VacationRentals.com and Holiday-Rentals.com and created an umbrella brand of “HomeAway”. In just 3 years, they have achieved a staggering valuation. Here is a link to more information on the pros and cons of the HomeAway funding.
http://www.fullybookedrentals.com/articles/20081113
November 14th, 2008 at 3:41 pm
I can see how this industry is going to grow. I prefer to rent a nice home or condo when I travel that has all the amenities of home. It is much nicer than any hotel that I have stayed at.
November 16th, 2008 at 9:58 am
I recently got a new puppy and I’m now looking into getting a vacation rental that allows pets. I see that most do.
November 17th, 2008 at 1:58 pm
Wow amazing as a Realtor selling & managing short term rental homes it is heartening to read so many great and positive comments on vacation homes.
Most vacation homes are loved by their owners who very rarely make any money out of them but the owners enjoy the home in Sunny Florida and hope they can get a break even figure.
Some offer free pool heat others a games room and I would say they all other more comfort and space than any hotel, it does pay to use homes who’s Florida managers are in an organization called the Central Florida Vacation Manager Association (CFVRMA).
November 18th, 2008 at 8:45 pm
Vacation rental is much more better than hotel. It make us feel like at our own home. One of my friend has started vacation rental business since 2 years ago And he just bought another new house for rent business. I can imagine how fast he double his money through this business.
November 19th, 2008 at 12:33 am
maybe i can try it out, inspires me to have a vacation right now.
November 24th, 2008 at 2:33 pm
There is nothing like having a kitchen wherever you are staying!
November 25th, 2008 at 9:26 pm
I’ve always been interested in the vacation rentals, any kind of rental properties really. However, being from Michigan, I’m afraid the days of picking any ole’ property to get financial gain is over for a while.
I agree though, vacation rentals are an up and coming market!
November 28th, 2008 at 9:23 pm
Most families prefer vacation rentals nowadays. Most people I know who prefer vacation rentals have big families, so, according to them, they like vacation rentals better than hotels.
January 1st, 2009 at 12:07 pm
I totally agree that staying in a vacation rental, especially if you are travelling with family, is the only way to go, especially in the current economic climate. It is beyond me why they are trying to shut them down in some locations. I think that probably the big corporations that own the hotels don’t want the competition. Suffice it to say that in spite of this, vacation rentals are still alive and healthy as more and more people discover this affordable way to travel.
January 4th, 2009 at 3:26 pm
I would agree with many of your comments in this post titled, ‘Vacation Rental Market Growing’.
By way of background, we own and manage our own vacation rental home in Ajijic, Mexico. Our target demographic is 50+ years old and are people that are considering retirement in Ajijic, Mexico.
In our experience, 95% of our bookings are online and 5% call our VoIP US phone number that rings here in Mexico to reserve.
Steve mentions, Homeaway raising $250 million and purchased web sites like VRBO, VacationRentals.com and Holiday-Rentals.com. I think the market for VRBO sites is going to consolidate.
Vacation owners are going to stop paying for sites that don’t offer a good R.O.I. For example I haven’t had a VRBO referred booking in 4 months. My books from other sources have been strong.
Happy New Year From Mexico!
Joe Chapala
Casa Preciosa Ajijic, Mexico
January 14th, 2009 at 5:14 am
We have RV and it’s a good way to save money while traveling.
January 14th, 2009 at 1:55 pm
Nice post very informative, with people right now being conscious with their spending vacation rental is surely a nice replacement to hotels when having your vacation.
January 15th, 2009 at 10:39 am
In retrospect I have researched into this topic before deciding to go into the online vacation rentals market. Currently we are seeing a huge growth rate in readership and bookings to our site which is still fresh of the press. We can confirm that there will be an influx of vacation homes rented versus hotel rooms rented. From a travelers perspective it is cheaper to rent a vacation home versus staying in a hotel. Escpeccially in this hard economic times that we are enduring it is best to say that there are better vacation home deals then hotel deals. There is less overhead for a vacation home owner then the hotel owners.
Clearly vacation rentals is the way to go!!
January 17th, 2009 at 6:11 am
The online vacation rental market is growing – there is room for expansion on almost every level. Making sure you’re playing the game and growing your competitive market share should be your primary objective right now.
January 20th, 2009 at 10:15 am
I do prefer vacation rentals, It’s better than hotels as I find it much more enjoyable and the freedom I get for my family and pets has no comparison or price for me.
Great blog, thanks for publishing.
Carlos
January 26th, 2009 at 1:28 pm
Great post, and there seems to be a big (market) opportunity for it in Florida.
February 9th, 2009 at 6:10 am
It’s amazing to see how quickly these companies are growing both their inventories, traveler base, and mainstream awareness.
I’ve stayed in some apartments myself while traveling, and as another commented said, the kitchen is a blessing.
The current consolidation phase will continue, and I think the end result will be nearly as easy to use as a hotel booking site.
February 11th, 2009 at 5:10 pm
I’m also looking into getting a vacation rental that allows pets. Most do, but some of the higher end ones vacation rentals are still strict about their no pet rules.
March 23rd, 2009 at 9:46 pm
Vacation Rentals are a far better choice than hotels. Especially here in Hawaii. You can get locations that are worth it for the privacy and exotic country side view. Private beach access is common with vacation rentals and so Is a private entrance. It takes you away from all the hustle and bustle in Honolulu town. You’re right on with the value you get for the extra amenities. It’s well worth the extra.
April 20th, 2009 at 9:20 am
The credit crunch means vacation rentals are only going to get more popular as families and holidaymakers try to cut costs and go on “staycations” closer to home – see this recent article in the UK Times newspaper for example.