The vacation rental market has made a few twists and turns along its journey over the last two decades. The industry has grown exponentially, with independent hosts, small property management companies, large property management agencies, vendors, and service providers all carving out a defined role within the ecosystem. This blog post will compare how physical space, guest expectations, marketing, amenities, and property care programs have evolved over the past twenty years. What was once a second-home-side-gig has evolved into a booming segment that dominates the travel space.
So, how did we get here?
Physical Space & Accommodation Types
2000s: Home rentals began as a no-frills experience where guests were responsible for providing the comforts of home, and the space was truly just a place to sleep. Travelers could rent single family homes or an extra room, but the physical space was a smaller component to the overall stay at the property.
2010s: Expanded offerings of luxury accommodations were introduced; including homes, condos, apartments, villas, and more purpose-built vacation properties. With luxury offerings came a rise in guest expectations for more service.
Today: Guests and managers emphasize the presentation of the property and amenities provided. Inventory has converged with hotels and luxury villas, and qualities have emerged to categorize and underscore luxury segments (think Airbnb Luxe). More eccentric accommodations are available, which include treehouses, houseboats and yurts.
Guest Expectations & Behaviors
2000s: While basic things like maps, brochures and directions were provided, travelers brought many of their own items needed for their vacation. Guests didn't expect much contact and interaction with the property manager, unless there was a significant maintenance issue that jeopardized their entire stay.
2010s: Managers took on more responsibility to provide guests with local recommendations, affiliations with local restaurants, tours/excursion information, and other concierge services. Travelers began to play a more vocal role through the introduction of online guest reviews, and OTAs increase access and ease of finding vacation rental properties.
Today: While providing a top-notch property has always been important, the pandemic has now underscored the demand for clean and high-quality properties. Moreover, facilitating an immaculate guest experience has become a focal point of vacation rental property management. A wide range of concierge services are expected from transportation, grocery deliveries, local recommendations, and guest tablets.
Marketing & Property Listings
2000s: Managers were responsible for marketing their properties through more 'old school' techniques and were reliant on repeat bookings. This meant managers focused their efforts on direct mail campaigns, paper advertisements, and direct bookings (rather than websites/OTAs). Property listings were minimalistic, consisting of one or two photos, a brief description, and a basic property name.
2010s: The 'Amazon Effect' changed the way consumers shop, and the way travelers looked for instant booking options. Vacation rental marketing went completely digital, and listing sites like Airbnb and Vrbo caught their stride and grabbed a large portion of the market. Property listings became more extensive, including creative property titles and a minimum of 12 photos (interior/exterior, daytime vs. nighttime). With the success of OTA's came the #BookDirectMovement, in an effort to empower local brands and encourage guests to book directly with hosts/property managers.
Today: Managers need to have an updated, modern website with extensive photos of the property (sometimes even 360-degree videos), enticing description, availability, and an option to book online. There's a push to focus on building your own brand through a strong website, social media presence, and online marketing strategy.
Amenities & Property Services
2000s: Guests were expected to bring all linens, and any comforts of home. Properties were decorated minimally, with family photos, not targeted to the incoming guests. Vacation rentals presented as a second home, rather than a rental property to be used by guests.
2010s: Higher guest expectations for the physical space began, and property management companies started offering more amenities like linens, laundry starter sets, and basic kitchen items to meet these needs. Homeowners were encouraged by managers to remove personal items from the property before guest stays.
Today: Today's guests expect a hospitality-level experience with concierge service, a fully stocked kitchen, updated appliances, smart technology throughout the property, keyless entry, private pool and hot tub, and other recreational amenities.
Property Care & Operations
2000s: Managers and homeowners relied fully on manual processes like paper checklists, excel, white boards, and lengthy email chains. Property preparation was important, but guest standards were nowhere near where they are today. Purpose-built software was extremely limited.
2010s: Managers started to adopt technology to handle front-of-house aspects like marketing, facilitating reservations, and revenue management. More service and amenities were offered to guests, and operators relied on PMS systems and workarounds to coordinate property care.
Today: The necessity for professional management has been underscored in today's climate. The complexities of property management have never been greater, and professionals are tasked with managing reservations, servicing guests, managing field staff and service partners, running smart property care workflows, and much more. In order to meet the demands of more work, managers are adopting purpose-built tools and ancillary technology to operate their business.
Conclusion: What Will the Next Decade Bring?
The vacation rental industry has seen a lot of change over the past two decades (as well as the past six months). Increasing expectations for quality and service has been a growing trend for guests and owners - one which has been accelerated by COVID-19 is the resulting focus on safety and sanitation. In fact, 97% of managers think that the pandemic has increased guest sensitivity to property cleanliness. The push for more quality and service should only grow higher and professional operators will be expected to sharpen their workflows and adapt to the needs and demands of their clients.