Vacation Rental Market In- Depth Analysis and Growth Strategies


The global vacation rental market is subject to witness a substantial growth due to the increasing preference of vacation home rentals over hotel lodging. Growing popularity of short-term rental apartments, farmhouses, and private homes among users is expected to drive the growth of the market over the forecast period.

Increase in the number of rental cabins, beach houses, villas, cottages, and chalets is anticipated to stimulate industry expansion in the upcoming years. Globally, the vacation rental market is predicted to grow at a CAGR of 6.89%, providing numerous opportunities for market players to invest for development of innovative vacation rental services.

Increase in domestic as well as international tourism worldwide was the major driving factor for market growth in the past few years. In addition, favorable government policies and aggressive marketing strategies adopted by industry participants are expected to fuel market demand for vacation rentals in the upcoming years. Additionally, increasing number of second homes as rental property that are professionally managed is forecasted to offer new growth prospects for vacation rental market. Shifting trend towards renting out property to generate excess of revenue by owners is propelling market expansion in the recent years.

Increasing number of initiatives to promote dying tourism by local governments, particularly in coastal areas or mountain regions that have faced extreme calamities such as tsunami and earthquakes, is estimated to favor market growth over the forecast period. Growing market penetration via appealing e-commerce websites is projected to drive large number of customers towards vacation rentals in upcoming years. In addition, cost effectiveness, higher capacity to host large groups and easy availability in comparison with hotel lodging services are fostering market demand over the next seven years.

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The market is broadly categorized into six major segments based on the service type such as rental apartments, farmhouses, private homes, rental cabins, beach houses and villas. The rental beach houses segment is growing rapidly in the vacation rental industry with substantial revenue generation in the last few years. Growing popularity of rental beach houses segment is attributed to the rising tourism in coastal areas and increasing promotional activities. The private homes segment has also witnessed substantial growth owing to the favorable government policies to promote tourism in the region.

The market is divided by region as North America, Europe, Asia-Pacific, Latin America and Africa. North America has shown major growth in recent years owing to the rise in number of tourist each years, favorable government policies to promote tourism in the region and presence of well-established market players.

European region is estimated to hold major share in the vacation rental market; displaying massive growth in forecast period. Countries such as U.K., France, Spain, Italy and Germany are leading the European market with rising international as well as local tourism, easy availability of vacation rentals and significant investment by leading industry players considering potential growth opportunities in the region.

The key players in the vacation rental market are Airbnb, Inc., The Apartment Service, Inc., At Home Abroad, Inc., Holiday Lettings Ltd., HomeAway Ltd., Homestay.com Ltd., iVacationRental Co., OnlineVacationRentals.com Ltd., Rentalo, Inc., Sea2Sky Vacation Rentals C.A., TripAdvisor LLC, Tripping.com Ltd., Villas International Ltd.

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