Short-term rentals are increasingly becoming a popular choice for travelers as they offer unique benefits that hotels sometimes lack. Despite hotels still dominating the market, trends show that short-term rentals are on the rise and pose a challenge to traditional accommodation options. According to Skift Research’s State of Travel 2024 report, vacation rentals have higher net promoter scores compared to hotels. This indicates a growing loyalty towards short-term rentals among travelers.
The report also highlights the increasing preference for short-term rentals among U.S. travelers, with 11% of travelers opting for vacation rentals in 2023, up from 7% in 2020. On the other hand, hotel usage declined from 60% in 2021 to 56% in 2023. While hotels still maintain a lead in popularity among U.S. travelers, the gap between hotels and vacation rentals is narrowing. This shift in consumer behavior indicates a potential shift in market share from hotels to short-term rentals in the coming years.
One of the main reasons U.S. travelers value short-term rentals over hotels is the location. Short-term rentals often offer scenic views that hotels may lack, providing a unique and desirable experience for guests. Additionally, respondents in a Skift Research survey from April 2024 cited comfort and cost advantages as key factors in choosing vacation rentals. With 15% of respondents preferring the comfort of short-term rentals for longer stays and 14% valuing the cost advantage they offer over hotels, it is clear that short-term rentals are appealing to a wide range of travelers.
While hotels may still be the go-to choice for many travelers in certain situations, the data suggests that short-term rentals have a significant opportunity to further penetrate the market and gain market share from hotels. As the preference for short-term rentals grows and more travelers experience the benefits they offer, it is likely that hotels will face increasing competition from vacation rentals. This shift in consumer behavior and preferences could lead to more hotels entering the vacation rental business to stay competitive and capture a share of this growing market.
Overall, the data from the State of Travel 2024 report indicates a positive outlook for short-term rentals as they continue to gain momentum and popularity among travelers. With higher net promoter scores, increasing usage rates, and perceived value in terms of location, comfort, and cost advantages, short-term rentals are proving to be a formidable competitor to hotels. As long as regulations do not hinder the growth of short-term rentals, it is likely that they will continue to disrupt the traditional hospitality industry and take a larger share of the market in the future. Hotels are already recognizing this trend and are expected to adapt their strategies to compete in this changing landscape.
