Key hotel destinations with fastest vacation rental growth

Through the growing correlations in operations, consumer services, supply and demand trends, the application for a holistic data strategy in each sector is becoming increasingly recognized. Accordingly, our expert team chose 25 cities across the United States that attract the greatest hotel demand. Through this, Lighthouse explores the evolution of short-term rental accommodation across these key hotel markets– and the ramifications for tourism and hospitality stakeholders. So, what are the key hotel destinations with fastest vacation rental growth over the past year?

Key hotel destinations with fastest vacation rental growth

Understanding alternative accommodation in a given market gives destinations the liberty to mitigate over-tourism. For instance through more balanced distribution, catering to different segments effectively, and crafting better enhanced marketing efforts.

Considering this, our team analyzed the following U.S. markets based on their prominence and dominance in hotel industries– where we discovered short-term rental property count growth and decline for properties. Our review consisted of millions of properties across four major OTAs– Airbnb, Booking.com, Vrbo and TripAdvisor. Moreover we looked at entire-homes, eliminating bedroom listed properties populating the analysis. Last, we measured counts in August 2022 and one year later, August 2023, tracking the most recent evolution of yearly growth.

Average growth and the median over the cities altogether were each +18%. Out of all the hotel dense markets we assessed, Phoenix, Arizona has seen the most rapid growth out of all. The city's short-term rental inventory grew by +41% this August over last year.

This growth has considerable impact on a destination's residential supply and infrastructure. Where social sustainability is concerned, our team discovered a correlation exists between lower density and higher relative growth destinations. It is important to realize intricacies and insights like these represent the changing industry that holds a myriad of aspects to surveil as vacation rentals grow. We call awareness to vacation rental demand and pricing data for all accommodation sectors to reveal. In all destinations, hotels and tourism bodies feel more compelled than ever to monitor short-term rental industry growth metrics.

Hotel dense U.S. cities ranked by vacation rental property count

Within these hotel markets, what's their ranking in terms of short-term rental property counts? 

Los Angeles, with growth of +26%, coinciding with an uptick in supply like higher-end inventory, stands out as on top with approximately 18k properties. Further, LA, Houston, Miami, San Diego, and Austin are all vacation rental hotspots that are home to over 10k properties each. Putting that into perspective, Miami hotel rooms amount to 58k spreading across 260 hotel properties. In similar fashion in San Diego there are around 64k rooms in over 560 hotels.

The average vacation rental count amounts to 7.6k properties, an approximate 17% growth over August 2022. 

The meaning behind managing, marketing and reporting on short-term rental growth & KPIs 

More short-term rentals are coexisting with hotels as they continue their preordained growth in certain hotel spheres. As a result this may beg questions like: 

• How are inventory fluctuations affecting the economy and sustainability in different vacation rental and hotel ecosystems? 

• What impacts do the distribution of inventory across online travel agencies and growth have on stakeholder trends? 

• How are optimal locations and their ROIs for expansion projects shifting? 

• Which vacation rental types (urban, rural, ski, beach) are growing, where, and is this seasonal? What effects will this have on guest and accommodation trends?

• How are regulations granularly influencing inventory and demand?

In effect, alternative accommodations make significant transformations on the maturation of diverse short-term rental marketing campaigns, management strategies, local economies big or large, and eco-friendliness. By and large, through a personalized data dashboard, hotels and destination bodies can access visibility over the full vacation rental supply plus a myriad of vacation rental oriented KPIs for any market globally designed to showcase the earliest signs of each shifting trend shaping the revived short-term rental industry. 

So, through analysis of over 17 million deduplicated active listings across 4 major OTAs (Airbnb, Booking.com, Vrbo and TripAdvisor), our DMO and hotel clients like you manage, market or report on the growth of their own or competing property metrics by clicking below.