Are the Short Term Rentals out Performing Hotels during this




Since the outbreak of COVID-19, many business sectors have been affected and the hotel sector is one of them.  Research by Skift Research shows that traffic on the online travel web has gone down by over 70 percent. Many countries have closed their borders and citizens subjected to quarantine. As a result, the activities in hotels and short term rentals are minimal.  Below are four factors that show whether short term rentals are outperforming hotels during this pandemic.

Minimal Physical Contact 

One of the regulations laid down by the World Health Organization (WHO) during this pandemic is for one to avoid physical contact with other people and observe the social distance. Staying in short term rentals involves minimal physical interaction with the guests and service personnel unlike in hotels. Those staying in short term rentals have control over their living environment unlike those staying in hotels. For this reason, most people are choosing short-term rentals over hotels.

Living Cost Optimization

During this pandemic, most people are not at work and a higher percentage is working from home. This has resulted in people cutting on costs. Short-term rentals are cheaper than hotels hence attracting more clients. Most short term rentals management is giving a discount to their clients as a means of attracting guests and this move has been successful. Also, most short term rentals have fully equipped units especially kitchens and they offer extra space unlike in hotels. This attracts return guests. 

Demand and Revenue

According to a report by The Highlands Group US, in the first four months of the year 2020, the demand and revenue for short-term rentals were down to 15 and 22 percent respectively. The same metrics for hotels fell to 32 and 35 percent. These metrics show that the short-term rental sector is less affected by COVID-19.

As of April 2020, there were 31.7 million available short-term rentals. This was a 16 percent increase from 2019. At the same time, there was a demand for 11.63 million rooms. The demand went down by 15 percent from 2019.  

Staffing and Supply Growth

Due to minimal activities in hotels and short-term rentals, most service personnel have been laid down. The short term rentals have fewer service personnel than hotels therefore, the hotels have been affected much more.  Also, the widespread travel restrictions have led many hotels to incur losses leading to the closure of many hotels. 

Some hotels might not be able to survive the pandemic and may close indefinitely even after the COVID-19 pandemic. This has affected the supply growth of the two with the rate of short-term rental supply doubling that of hotels from 2019. 

Although both hotels and short-term rentals sectors have been both affected by the outbreak of COVID-19, the impact COVID-19 has hit hotels more. Short-term rentals have outperformed hotels during this pandemic. Call Property Guard on (855-933-0731) for short term rental data and analytics services. We provide quality services with good pricing. Please visit here to learn more: