How a Recession Will Affect Short-Term Housing Rentals

Contrary to popular opinion, short-term rentals have existed since the 1950s, although under the more straightforward title “vacation rentals.” The advent of an online marketplace dedicated to the short-term rental market had trickled in at dial-up speed in the mid-90s before taking off in recent years. For many multifamily owners, the rise of the short-term market represented something of a nuisance thanks to liability exposure and quality-of-life disruptions for the other tenants. But now, many are looking at short-term rentals with fresh eyes. 

Short-term rentals have been on the rise for over a decade until they ultimately culminated into a boom during the aftermath of the COVID-19 pandemic. Pandemic-induced events like the switch to remote work and long stretches of recurring lockdowns meant that a huge swath of the workforce was no longer constrained to their homes and was free to work from wherever they pleased. 

In context with the travel industry’s post-2020 recovery, the short-term rental industry was in a different league. Hotel chains like Hilton started seeing the light at the end of the tunnel as 2021 was drawing to a close with positive fourth-quarter earnings with revenue per room increasing by 60.4 percent from the previous year (we’re talking $73.65 dollars per room in 2021 compared to $46 dollars per room in 2020), but that was nowhere near pre-pandemic levels. Airbnb, on the other hand, exceeded pre-pandemic sales with a fourth-quarter revenue of $1.5 billion, a 38 percent increase from the same period in 2019.  

See AlsoDecember 1, 2022How Multifamily

The post How a Recession Will Affect Short-Term Housing Rentals appeared first on Propmodo.

You May Also Like