Airbnb made their headline moment back in 2008, when the improbable home-sharing system became a huge market success. But since the start of the Covid-19 epidemic, the time when the company has made its long-awaited IPO, more news about Airbnb and short-term rental (STR) has made headlines.
Supporting the buzz is the real number – short-term rent has become an almost infallible way for hosts and investors to return higher than average with still-low risk. In October 2021, the average nightly price of a short-term rent in the United States was an impressive $ 236. Hosts also saw an average occupancy rate of 57% for the month. And since both prices and demand vary widely from city to city, many hosts are seeing a return to sustainable demand at much higher prices.
How easy it can be to participate in the market boom combined with the financial greed of short-term rent. “Every homeowner who has an address has a strong resource,” Amir Dukik, CEO of Rabbur, a full-service asset management company that helps investors source, optimize and sell short-term rents. “They could rent out while on vacation, offer a single unused bedroom, or rent the entire property as a full-time short-term rent. “
Low demand for short-term rent
The short-term rental (STR) market is being supported by three main demand channels, none of which will change or decline any time soon. Leisure travelers are looking to stay in neighborhoods where they can enjoy a change of scenery and take maximum advantage of working from home. Now, leisure travel is also supported by international travelers who will be able to travel again once the border is opened.
The second demand channel is coming from potential buyers whose prices are skyrocketing outside the housing market. Without the resources to settle in a dream home, more and more people are making purchase decisions. And yet uncertain whether the next few months could be a return to the office, a family visit, or a relocation with a new job and new priorities, short-term rent provides an important sense of freedom and flexibility.
The ultimate channel of demand is coming from the corporate world. With meetings, conferences, and events returning to private gatherings, STRs are becoming the preferred way to get the most out of company travel. Larger homes offer the opportunity to form attractive teams, yet stay away from the long-term dangers of large-hotel activity. With the added value of being immersed and unique, corporate travel is positioned to introduce much higher STR demand. “These three streams of market interest flow into a large, lucrative lake, supporting the continued strength of the STR market as the epidemic resolves gradually,” he said. Duke says.
For Hosts: A New Way to Invest
Technology and innovation in the STR space have taken risks from secondary property investments. A new Airbnb revenue generator can help potential hosts understand exactly what their property can do. The tool provides a three-tiered adjustment analysis of potential property gains based on comparable rents in the area. It helps homeowners make a plan and take the necessary diligence for any investment.
To optimize revenue, new technology-heavy solutions lend a helping hand to hosts Grant works from guest underwriting, home access control, adaptive property stuffing and automated marketing property operations. “With these types of solutions, the STR market is operating just like any other asset class.” Duke says. “The job of most investors is to find assets and establish the right workflow. Then, the investment takes its life of self-accumulated value even in the investor’s sleep.
Lessons learned: Short term rent and sustainable living
STR has another important value offer: a return to a more employed, more sustainable lifestyle. For small communities and secondary markets, the circular home-sharing economy has helped attract revenue to tourists and keep many businesses afloat. Similarly, returning to the basics and engaging in the unique experience of the local community provides a more humane connection and paves the way for new employment opportunities.
Throughout the epidemic, the average person’s environmental awareness has increased dramatically. Signs of wildlife return and tiny environmental recovery have convinced many that the next steps were not only necessary, they were immediate. Many popular STRs offer people a way to reconnect with nature. There is a growing demand for hiking trails, natural attractions and outdoor activities. During this last year’s challenge, more and more people praised the natural world we have and what it can do to restore it. STRs now stand as a cost-effective way to engage in more sustainable travel, contribute directly to the local economy and reap the benefits of going out, appreciating nature and striving for a greener lifestyle.