The pandemic has had a massive impact on the short-term rental industry. Not only were overall bookings impacted (particularly during lockdown periods), but the locales travelers were interested in changed, too.
People started seeking escapes -- places they could get away with their families, maintain social distancing, and avoid high-risk travel activities like flying. As a result, rentals within driving distance of major cities surged. Some properties were even used as outright quarantining locations.
Now, yet another trend is afoot: Bookings in mountain destinations.
Are you an Airbnb (NASDAQ: ABNB) or short-term rental investor? Here’s what you need to know.
The trend toward remote locales
According to new data from AirDNA, demand for mountain rentals was up 15.5% in December 2020 year over year.
That’s a stark contrast to urban and suburban-located properties, which have seen demand plummet 55% and 33%, respectively. It’s also a notable reversal of general short-term rental trends, too. In fact, for the same period, AirDNA’s data has overall demand for STRs down 15.3%.
Fortunately, mountain destinations are still going strong. Just a few of the mountainous spots seeing upticks include:
- Hudson Valley, New York (revenue per available rental is up 84.9% year over year)
- Coachella Valley, California (+84.3%)
- Big Bear, California (+73.1%)
- Lake Tahoe, California (+67.4%)
Alabama’s Gulf Shores -- not in a mountainous area, but a “destination” spot nonetheless -- has also seen a big spike. Revenue per available rental is up almost 87% over the year in the area.
Scott Shatford, CEO and founder of AirDNA, chalks it up to the outdoor opportunities these locales provide: “Markets that provide the opportunity for outdoor adventure drove new bookings in December. Not surprisingly, all three of our top markets for new bookings are near national parks: Glacier, Acadia, and Zion.”
Where demand is waning
With the pandemic still raging on, interest in urban and suburban rentals has dropped considerably.
The trend is apparent in big cities like New York, where demand has dropped a whopping 55.9%, and in Maui, Hawaii, where demand was down 21.8% in December -- a surprise, given the area’s usual popularity in winter.
Overall, 70% of new bookings in December were for rentals outside of major metros.
The bottom line
When it comes to short-term rental investments, all locations are not created equal -- especially during a pandemic.
If you’re considering expanding your portfolio, choose your properties wisely. Venture outside busy urban centers and look toward drivable destinations elsewhere in the state -- ideally, ones with plenty of outdoor activities.
And if you’re looking to speed up the pace at which this pandemic ends? Try this solution some Airbnb hosts are touting.