Vacation Rental Market Top Players are Booking Holdings Inc. and Expedia Group Inc.

Vacation Rental Industry Overview

The global vacation rental market size was valued at USD 74.64 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 5.3% from 2022 to 2030. Rising expenditure on travel, vacations, and accommodation among the millennials generation is driving the market. According to Copyrise, 200,000 million global tourists are millennials and they spend around USD 180 billion on travel every year.

However, the COVID-19 pandemic has negatively impacted the growth of the market. For instance, according to AirDNA, there has been a significant drop in weekly bookings between the beginning of January and March 2020. Moreover, the number of bookings in Beijing dropped by 96%, Shanghai by 71%, Seoul by 46%, and Rome by 41%.

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Travelers in the market are more inclined towards vacation rental property over hotels owing to the comfort, low cost, more privacy, and kids and pet-friendly nature of the accommodation. Low cost as compared to hotel accommodation with similar amenities drives the consumer’s inclination towards vacation rental property. For instance, according to the TurnKey Vacation Rentals 2019 survey, 64% of travelers prefer staying in vacation rentals to hotels.

Moreover, it has been observed that while traveling with family, consumers consider various factors while choosing a vacation rental for amenities and comfort. For instance, according to the report of iPropertyManagement in 2021, 71% of families traveling with children prefer to prepare their own meals, which was a likely factor in their decision to stay in a vacation rental.

Additionally, rising supply is increasing the demand and availability of vacation rentals owing to low costs compared to hotels. As per Stratos Jet Charters, Inc. statistics, there are 2.9 million hosts on Airbnb worldwide, and over 14,000 hosts are among the new additions each month in 2021. Moreover, Airbnb operates in around 220 countries, with around 100,000 cities with active Airbnb listing in 2021.

The influence of social media and the internet is increasing awareness among consumers regarding services and offerings. Key players are offering various services, exotic locations, and amenities to gain market share, and are offering services dedicatedly to female travelers. For instance, in January 2020, Golightly was launched, which is a vacation rental platform managed by women and only available for female guests, also allowing men. The company owns more than 350 properties across the globe.

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Short-term Vacation Rental Market - The global short-term vacation rental market size was valued at USD 99.38 billion in 2021 and is expected to grow at a compound annual growth rate (CAGR) of 11.1% from 2022 to 2030. 

Online Travel Booking Service Market - The global online travel booking service market size was valued at USD 519.1 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 9.0% from 2022 to 2030.

Vacation Rental Market Segmentation

Grand View Research has segmented the global vacation rental market on the basis of accommodation type, booking mode, and region:

Vacation Rental Accommodation Type Outlook (Revenue, USD Million, 2017 - 2030)

• Home
• Apartments
• Resort/Condominium
• Others

Vacation Rental Booking Mode Outlook (Revenue, USD Million, 2017 - 2030)

• Online
• Offline

Vacation Rental Regional Outlook (Revenue, USD Million, 2017 - 2030)

• North America
• Europe
• Asia Pacific
• Central & South America
• Middle East & Africa

Market Share Insights

December 2021: Booking Holdings Inc. acquired Getaroom from Court Square Capital Partners for USD 1.2 billion. Through this acquisition, the brand aims to increase the value of its pipeline.

October 2020: Tripadvisor launched two new technology solutions Spotlight and Reputation Pro for hotels. Both aim to improve their hospitality business and build traveler confidence, attract new customers, and make data-driven decisions to increase profitability.

Key Companies profiled:

Some prominent players in the global vacation rental market include -

• 9flats Pte Ltd.
• Airbnb Inc.
• Booking Holdings Inc.
• Expedia Group Inc.
• Hotelplan Holding AG
• MakeMyTrip Pvt. Ltd.
• NOVASOL AS
• Oravel Stays Pvt. Ltd.
• TripAdvisor Inc.
• Wyndham Destinations Inc.

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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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