Vacation Rental Market Size - By Property (Apartments, Houses/Villas, Cottages, Resorts), By Location (Beach, Mountain, Urban, Theme Parks), By Pricing (Economy, Mid-Range, Luxury, Ultra-Luxury), By Travelers (Solo Travelers, Couples, Families, Group), Booking Mode, Duration of Stay & Forecast, 2024 - 2032

Published Date: July - 2024 | Publisher: MRA | No of Pages: 240 | Industry: Professional-Services | Format: Report available in PDF / Excel Format

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Vacation Rental Market Size - By Property (Apartments, Houses/Villas, Cottages, Resorts), By Location (Beach, Mountain, Urban, Theme Parks), By Pricing (Economy, Mid-Range, Luxury, Ultra-Luxury), By Travelers (Solo Travelers, Couples, Families, Group), Booking Mode, Duration of Stay & Forecast, 2024 - 2032

Vacation Rental Market Size

Hey there! The vacation rental market is on fire, valued at a whopping $99.6 billion last year. And guess what? It's only going to keep growing, with experts predicting a steady 3% increase over the next few years. Why is this happening? Well, it's all about the younger crowd, like us millennials and Gen Z. We're not into stuff like our parents were. We want experiences that are real, that give us a taste of the local culture. We want to feel like we're part of something bigger when we travel. Hotels are great, but they're all pretty much the same. Vacation rentals, on the other hand, come in all shapes and sizes. From cozy cabins to hip lofts and even ancient villas, there's a place out there that matches who you are and what you're into. This makes it easy to feel connected to the place you're visiting, like it's actually your home away from home.

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The rise of online booking websites has revolutionized how people book vacations, making it easier and more convenient. Back in the day, if you wanted to rent a vacation home, you had to sift through ads or ask for recommendations from friends and family. Now, online platforms provide a one-stop shop where travelers can browse thousands of vacation rentals around the world. This convenient access has attracted a much larger audience to the vacation rental market, expanding the overall market size. Online booking services make it a breeze for travelers to find, compare, and book the perfect vacation rental. Fast booking, secure payments, and user-friendly interfaces remove any hassle from the process. This easy-to-use experience makes it more likely that travelers will choose vacation rentals over other options.

Vacation Rental Market Report Attributes
Report Attribute Details
Base Year 2023
Vacation Rental Market Size in 2023 USD 99.6 Billion
Forecast Period 2024 - 2032
Forecast Period 2024 - 2032 CAGR 3%
2032 Value Projection USD 137.4 Billion
Historical Data for 2021 - 2023
No. of Pages 260
Tables, Charts & Figures 300
Segments covered Property, Duration of stay, Booking Mode, Location, Pricing, Travelers
Growth Drivers
  • Newer generation seeking unique and authentic travel experiences
  • Growth of online booking platforms
  • Advancements in AI-driven property management technology
  • The rise of remote work
  • Rising disposable incomes, particularly in developing countries
Pitfalls & Challenges
  • Vacation rentals facing seasonal fluctuations
  • Regulation and compliance from local government

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The global vacation rental market faces a major challenge owing to seasonal fluctuations, potentially slowing down its growth. Unlike hotels, which have year-round demand, vacation rentals face large fluctuations in reservations throughout the year. Peak seasons, such as summer or skiing depending on geography, result in an increase in reservations and income.

However, off-peak seasons can lead to poor occupancy rates and much lower income for property owners. This variability makes it difficult for owners to plan and budget properly, threatening financial stability and even restricting investment in property renovations. Finding the best pricing plan for navigating seasonal changes can be difficult. High pricing during busy seasons might increase income but may discourage certain bookings. Lower rates during off-peak seasons, on the other hand, may entice visitors but fail to generate enough revenue to cover expenses.

Global Vacation Rental Market Trends

The global vacation rental industry has been witnessing significant technological advancements. 3D virtual tours enable tourists to visually explore a home before booking, delivering a more immersive and realistic experience than static photographs. This builds trust and enhances the chances of booking. User-friendly smartphone applications make it easier to look for, compare, and book vacation rentals while on the road. This addresses the rising trend of mobile-first browsing and booking habits. Integrating smart home technologies such as keyless entry, smart thermostats, and voice-activated assistants makes the visitor experience easier and more hassle-free.

Furthermore, software technologies automate operations such as scheduling cleaning services, monitoring guest interactions, and delivering automated messages, saving important time for property owners and managers. This enables them to expand their business and handle more properties.

Global Vacation Rental Market Analysis

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In 2023, quick getaways ruled the travel scene, and they're only getting more popular. People are ditching long vacations in favor of shorter trips and unique experiences. With our hectic lives and tight budgets, taking an extended break can be tough. That's where short-term rentals come in like a savior, offering a comfy and convenient home away from home for weekend escapes, city adventures, and spontaneous trips. They're a steal compared to traditional hotels, especially for groups or families. Vacation rentals often have more space and amenities for the same price, so you can save some hard-earned cash. And when you split the cost with your travel buddies, a short-term rental becomes even more budget-friendly.

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City living is hot! In 2023, almost 3 out of 10 vacation rentals were booked in urban areas. That's because cities are like magnets for people looking for a quick getaway. They're jam-packed with things to see and do, from museums and historical sites to bustling nightlife and delicious restaurants. Plus, cities are where the jobs are. So, if you're traveling for business and need a place to crash, vacation rentals offer more space and amenities than your average hotel room. It's no wonder that so many people choose to stay in the heart of the action when they're on vacation or business.

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Europe is a popular destination for vacation rentals, with a significant market share of around 32%. Countries like France, Germany, the UK, and the Netherlands are seeing strong growth in this sector. Europe has always been a major tourist hub, thanks to its rich history, vibrant cultures, and stunning landscapes. This attracts millions of visitors each year, creating a high demand for all types of accommodation, including vacation rentals. Europe's well-connected transportation networks, ease of travel between countries, and efficient infrastructure within cities make it easy for travelers to explore different regions. This encourages multi-destination trips, which are a perfect fit for the flexibility offered by vacation rentals.

The U.S. has a thriving domestic tourism business, with many individuals traveling within the country for leisure. Vacation rentals appeal to their quest for unique experiences and larger lodgings than hotels. The sharing economy is deeply embedded in American society. People are increasingly comfortable renting out their houses or employing holiday rentals instead of regular motels. Beach areas such as Florida, California, and Hawaii are popular vacation rental locations because to their pleasant weather and proximity to water bodies.

Economic growth in many Asian countries has led to rising disposable income, allowing more individuals to travel and spend on leisure activities like vacation rentals. The developing middle class in nations such as China and India constitutes a sizable market group with rising travel expectations. Vacation rentals are an appealing alternative to typical hotels, sometimes offering greater room and facilities at lower costs. Many Southeast Asian countries, such as Thailand, Indonesia, and Vietnam, boast captivating landscapes and rich cultural experiences, drawing an increasing number of international visitors. Vacation rentals cater to this inflow by providing a variety of lodging alternatives.

Vacation Rental Market Share

Airbnb, Booking Holdings Inc. an Expedia hold a significant market share of over 41% in the vocational rental market. Airbnb has targeted campaigns to recruit new hosts, focusing on high-demand regions and emerging markets. They promote a variety of property types, including unique accommodations such as treehouses, yurts, and luxury villas, to attract a broader range of travelers. Additionally, Airbnb offers extensive support and training programs for hosts to improve listing quality and guest experiences.

Booking Holdings Inc. uses AI-powered search and booking engines to enhance accuracy and efficiency in the booking process. They continually upgrade their mobile app with features like instant booking confirmations, real-time customer support, and localized recommendations. Additionally, they leverage data analytics to create personalized marketing campaigns, targeting specific customer segments with tailored offers and promotions.

Vacation Rental Market Companies

Major players operating in the global vacation rental industry are

  • Airbnb
  • Booking Holdings Inc.
  • Expedia
  • OYO Vacation Homes
  • RedAwning
  • Sonder
  • Stayz
  • TripAdvisor
  • TurnKey Vacation Rentals
  • Vacasa

Vacation Rental Industry News

  • In June 2024, OYO, the Indian hospitality company, launched its premium vacation home rental brand Belvilla in the UK. Belvilla by OYO offers short-term stays in prime locations across the country, including London, Milton Keynes, Birmingham, Sheffield, and Leeds. OYO partnered with high-end apartment rental management company SOJO, which operates more than 250 apartments in those cities, as well as properties in Manchester, Suffolk, Berkshire, and Southwest England.
  • In May 2024, Munich-based vacation rental company Holidu acquired Clubrural, a portal for rural vacation rentals in Spain and Portugal. The acquisition aims to improve the experience for both hosts and guests. Hosts will benefit from a wider reach on the Holidu platform to attract more international customers, as well as Holidu's modern software and personalized local service.

This vacation rental market research report includes in-depth coverage of the industry, with estimates & forecast in terms of revenue (USD Million) from 2021 to 2032, for the following segments

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Market, By Property 

 

  • Apartments
  • Houses/Villas
  • Cottages
  • Resorts
  • Others

Market, By Duration of Stay

  • Short-term
  • Medium term
  • Long term

Market, By Booking Mode

  • Online
  • Offline

Market, By Location

  • Beach
  • Mountain
  • Urban
  • Theme parks

Market, By Pricing

  • Economy
  • Mid-range
  • Luxury
  • Ultra-luxury

Market, By Travelers

  • Solo travelers
    • Online
    • Offline
  • Couples
    • Online
    • Offline
  • Families
    • Online
    • Offline
  • Group
    • Online
    • Offline

The above information is provided for the following regions and countries

  • North America
    • U.S.
    • Canada
  • Europe
    • UK
    • Germany
    • France
    • Russia
    • Italy
    • Spain
    • Rest of Europe
  • Asia Pacific
    • China
    • India
    • Japan
    • South Korea
    • ANZ
    • Southeast Asia
    • Rest of Asia Pacific 
  • Latin America
    • Brazil
    • Mexico
    • Argentina
    • Rest of Latin America 
  • MEA
    • UAE
    • South Africa
    • Saudi Arabia
    • Rest of MEA

 

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