It’s summertime in most American cities but the living ain’t necessarily easy if you own a vacation rental. A boom in the vacation rental industry over the past several years has meant increased competition, fewer quality inquiries, and slumping occupancy rates for owners who once needed only open their doors to stay full year-round. But what does this mean?
Left to its own devices, I believe the vacation rental market to be the most underestimated and unpredictable travel segment in the world. A confluence of factors leads me to this conclusion, but here is the backbone: recent demand for vacation rentals has increased exponentially (and will not slow down), yet as a result, the leverage of the suppliers to this market (the owners) has been seriously strained.
The former is great news for travelers who, as seasons pass, will have more vacation rental options to choose from, cheaper prices to pay per night, and overall better experiences to enjoy.
But what about the owner? Where does this ultra-competitive pre-boom period leave them? The answer: on shakey ground.
Vacation rental owners need to get with the times. Not only are more individuals purchasing vacation rental homes instead of traditional investments. Not only are more second-home owners opting to rent out their home for extra cash. Not only have more property management arms been established over the past 10 years than in history. And not only has an explosive boom in the technology field spawned gobs of new services designed to help owners get a leg up.
The vacation rental industry (as it pertains to owners) is about to be a tale of two cities.
You’ll have the days of old when everyone and their sister could fill a rental at the drop of a baseball hat; the days when a $200 year-long listing on VRBO was enough to satiate even the most obscure rentals.
Opposite that, you’ll have the not-so-distant future in which only the fittest, most prepared owners are equipped to survive. These are the owners who have taken initiative with their marketing plans: they have established their owner personal websites with blogs and professional photographs and proprietary booking software. These are the owners who don’t sulk over a lack of VRBO or HomeAway or FlipKey leads because they don’t rely on third-parties—they can generate their own flow of leads. I guarantee, these will be the owners that will swallow up the bulk of the bookings in the near future, leaving any owner who’s not ready to “fight” in their dust.
The vacation rental industry if not already proven, is about to be an insanely profitable one. But growth doesn’t necessarily mean everyone wins.
I am proud of all my newsletter subscribers because it shows they are at least aware of this impending battle and they are prepared to get a head start. It is the owners who fail to accept this obvious vacation rental industry shift that I feel sad for, because they simply don’t know what’s about to hit them.
Follow Matt on Twitter @bookmorenights