What comes to your mind when you hear ‘vacation rentals’? What is the first thing you Google when you are planning a vacation with your friends and family? If the answer is Airbnb, you’re not alone.
Airbnb has become the most popular platform for connecting owners and tenants for very short-term vacation rentals, ranging from a few hours to a few weeks. A report by Statista revealed that in 2023 alone, people booked more than 448 million rentals on Airbnb!
What makes Airbnb so special? For one, it offers the experience of homely stays, with an opportunity to explore the local culture. Many Airbnb owners also take special requests to create a personalized experience for tenants.
Why look for alternatives to Airbnb?
The revenue of the global vacation rental market was projected to reach over USD 94 billion in 2023. Airbnb’s annual revenue was USD 8.4 billion dollars. As you can see, while Airbnb is the most dominant player in the market, it makes up for less than 20% revenue of the entire market.
So it’s only natural to ask, what else is out there? Who are Airbnb’s competitors, are they as good? And most importantly, are they worth investing in? Let’s answer these questions one by one, but first we will start by understanding the short term rental ecosystem in the USA.
Short term vacation rentals in USA
Short term rentals have revolutionized the way people travel and live. Gone are the days when you had to book an expensive hotel, or sleep in a dormitory for the sake of travel. Your stay doesn’t have to be overpriced on one hand, or excessively uncomfortable on the other.
In fact, the stay can be an experience in itself! Short term vacation rentals typically advertise their spaces as experiences of comfort, luxury, and most importantly- the familiar feel of having a kitchen, balcony, TV set, or anything that makes you feel at home.
Certainly, these rentals are quite popular. In fact, the Gintux Market Data report 2024 showed that 44% of respondents preferred short term rentals to traditional hotels, especially if they had a hot tub and high tech amenities. Moreover, short term rentals were found to be especially popular among millennials and Gen Z.
Alternative platforms for vacation rentals
Although Airbnb is a dominant competitor in the market, there are many other alternatives for travelers. These are often not so visible because it feels like Airbnb almost has a monopoly over the vacation rental market. So let’s look at these hidden gems in the short term vacation rental industry.
Booking.com
Booking.com is a sort of umbrella platform for hotels, house rentals, transport, etc. It is designed to be a one-stop solution for tourists to plan their entire stay, with all kinds of bookings including travel, accommodation and sightseeing.
The downside of Booking.com is that you will be competing with hotels. But on the other hand, you will get good exposure for your listing. The company works on a commission model, wherein partners have to pay a set percentage of their revenue for the bookings that they get through the platform.
Vacasa
While Airbnb and Booking.com simply list and advertise your property to potential tenants, Vacasa goes a step ahead and takes care of all property management tasks for you. It is a vacation rental management company, that partners with property owners who want to rent out their houses for short periods of time.
The company has partnered with homeowners across several destinations in North America. They also manage different kinds of properties like beachfront houses, cabins, condos, apartments, etc. People who want to book a place can use their points from different hotels who have partnerships with Vacasa, like Wyndham and Marriott.
Moreover, the user-friendly app provides a seamless experience for tenants. They can easily view prices, check in instructions, etc. and text customer support 24/7.
Vrbo
Owned by Expedia group, Vrbo is similar to Airbnb in many ways, except for the publicity and brand image. Vrbo has a unique program called the One Key loyalty program. This is how it works- when users collect reward points across different booking sites like Hotels.com and Expedia, they can combine all these points and redeem them on any of these three sites!
You can list your property on their website, and mark certain eligibility criteria for guests. That way, you get to choose who lives in your property, depending on whether they fulfill those criteria.
If there is damage to your property, you are protected by a fixed amount in primary liability coverage. Not just property owners, even managers can sign up on the website, provided that they manage more than 10 properties.
Homestay
Homestay allows property owners to rent out their properties on weekdays, so that they can keep the weekends to themselves. So, you can rent out your spare room, or the entire place, and still have it to yourself on the weekends.
People searching for a place come across your listing on the website, and they send a booking request. If your room is available on those days, you confirm availability and accept the booking. Usually payment is made on arrival.
You can put a special request in your profile about charging some percentage of the amount upfront. You can get a 25% deposit compensation for people who don’t show up or cancel last minute.
Now that we have looked at different alternatives, it’s clear that none of these platforms are as widespread and popular as Airbnb. But they have certain unique features that are worth marketing, and it’s always a good idea to explore these hidden gems.
If you are a property owner who wants to rent out your space as a vacation rental, choosing a platform for listing is a decision you have to make carefully. There are many factors to consider- reliability of the company, past reviews, how they handle fees and cancellations, insurance and compensation in the event of damage, etc.
Take some time to think about whether you are ready to make such an investment. Read customer reviews, reach out and talk to existing partners on these platforms. At the end of the day, there is no one perfect platform, it really just depends on your needs and priorities. Good luck!
