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Skift Take
Mid-sized cities are becoming the new hotspots for July 4th getaways.
Travelers heading to destinations along the Atlantic coast for the Fourth of July weekend booked short-term rentals in large numbers. However, New York City didn’t see as many short-term rentals as it did last year for the holiday.
Editor-in-Chief Sarah Kopit and Head of Research Seth Borko discussed those topics and more in this episode of the Skift Travel Podcast with Jamie Lane, AirDNA’s chief economist.
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Key Points
Increased Travel for July 4th: This year shows a significant increase in travel compared to last year due to the long weekend, with booking data indicating a 15% year-over-year increase. This suggests more people are traveling, booking short-term rentals, and participating in typical July 4th activities like grilling, swimming, and fireworks.
Short-Term Rental Trends: The short-term rental market is showing mixed results. While some traditional urban destinations are struggling, small to mid-sized cities and classic vacation spots are seeing strong demand. The overall supply growth is slowing, potentially leading to better occupancy rates and profitability in the future.
Impact of International Travel: International travel to the U.S. has not fully recovered, with East Coast cities faring better due to European travelers, while West Coast cities lag due to fewer Asian visitors. However, travel from India is a bright spot, significantly exceeding 2019 levels.
Platform Dynamics: Airbnb is outperforming Vrbo in terms of supply and bookings. Airbnb’s ability to attract new hosts and drive bookings, especially in small to mid-sized cities, has given it an edge. Vrbo, traditionally stronger in coastal and mountain markets, is facing challenges in growing its supply and bookings.
Unique Stays and Marketing Strategy: While unique stays (yurts, treehouses, etc.) only make up a small percentage of Airbnb’s listings, they play a significant role in marketing by capturing potential customers’ imaginations. This strategy, along with features like group messaging, is helping Airbnb increase app usage and attract a broader audience.
Episode Summary
In this episode of the Skift Travel Podcast, our hosts are joined by Jamie Lane, Chief Economist at AirDNA, to discuss the short-term rental industry’s outlook for Independence Day weekend. Lane notes that this year’s long weekend has boosted travel compared to last year, with bookings up 15% year-over-year due to last-minute planning.
The discussion reveals that popular destinations include coastal and lake areas such as Orlando, Myrtle Beach, and the Outer Banks, with a notable absence of urban locations. Lane explains that traditional vacation spots are performing well, while cities like New York have seen declines due to regulatory changes and reduced international travel, particularly from Asia. He also highlights the rise of mid-sized cities like Chattanooga and Lubbock as emerging markets for short-term rentals.
They also look at the impact of interest rates and hotel development in these growing areas, with Lane suggesting that high interest rates and cautious lenders have shifted demand towards short-term rentals. The hosts discuss the growth and professionalization of the short-term rental market, noting that large management companies are expanding, though individual hosts still dominate in guest satisfaction.
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