What is short-term rental demand growth in key hotel markets into Q4?

We have seen some of the most significant short-term rental growth in key hotel destinations over the post-pandemic period, and as the next chapter we take those same hotel dense markets and analyze their Q4 demand evolution since 2019 before looking forwards to 2024. What are the latest reservation trends expected to follow through into Q1 of 2024? Today, discover short-term rental demand growth in key hotel markets into Q4 and into 2024.

Growth in total booked nights in vacation rentals across 25 hotel-dense markets

Our team assessed growth in entire-home vacation rentals by looking at the total booked nights from all of Q4 2022 and 2023. Through which we developed a measurement of demand growth, specifically how many nights are being booked – contrary to the proportion of short-term rentals that have been occupied. In other words, we were interested in the sum of how long all guests stayed in their rentals rather than the average amount of rentals occupied.

Evolution of vacation rental total booked nights 

Our team assessed growth in entire-home vacation rentals by looking at the total booked nights from Q4 2022 and 2023. Through which we developed a measurement of demand growth, specifically how many nights are being booked. This is contrary to the proportion of short-term rentals that have been occupied. In other words, we were interested in the sum of how long all guests stayed in their rentals rather than the average amount of rentals occupied.

We found 92% of analyzed markets experiencing positive growth in Q4 2023 over Q4 2022. On the other hand San Francisco, Miami Beach and Atlanta were markets with less booked nights than the year prior. Despite this, growth across all markets averaged +23%, and the median +24%– booming by nearly a quarter.

Phoenix - a market reaping the benefits of sports tourism following compression from hosting the Super Bowl LVII - has grown by over +51%. The inventory growth of +41% we measured in Phoenix reflects this strong positive growth. Furthermore, San Antonio, Miami, Denver, and Boston all gained remarkable demand over the fourth quarter of 2022 at >40%. 

In June, Business Insider reported on the top US cities for digital nomads. They highlighted the advantage Western and Midwestern markets have on rent. Four of the best cities for remote-working travellers, San Antonio, Denver, Chicago and Houston, also make an appearance on our list of positively growing markets in total booked nights.

Key city vacation rental total booked nights evolution

Below we have taken several markets that showed the most positive growth of total booked nights. Additionally, we have broken down their Q4 evolution since 2019. As you can see, most nights have an uptick most remarkably in 2023:

Industry performance has come a long way. In essence, early growth in total booked nights continues to perform above 2019 levels– with the exception of 2021. Demand analysis derived from total booked reservations gives us a crucial perspective when assessing supply and demand. This reveals a remarkable growing amount of vacation rental night's guests are spending in those markets. 

Project with forward-looking demand data for short-term rentals in hotel markets

The convergence of accommodations across global markets in well documented. The resulting symbiosis and clashing of short-term rental and hotel inventory has varying impacts for different stakeholders in different markets.

For hotels and short-term rental property managers there is a growing benefit to underpinning revenue management strategy with a holistic market view. In DMOs, visibility across all accommodation types - density, distribution, counts, revenues and evolution - is more important than ever for gaining a complete barometer for marketing and management. For investors, understanding revenue heat maps, competitive distribution and supply and demand trends illuminates the path to greater ROIs. 

All in all, data on short-term rental and hotel markets sheds light on trends and opportunities, and in understanding the symbiotic growth of the two industries - for everyone. As markets become increasingly saturated with both traditional hotels and vacation rentals, understanding the dynamics of market share and relationship is crucial. So, start today and explore our data solutions designed to facilitate informed decision making across all spheres.