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The company thinks that urban demand will fully recover to 2019 levels in late 2023.

Large cities and urban markets were decreasing by -46%.ĪirDNA sees urban markets starting to revive in late 2021.

Small city and rural markets were growing at +62%.

The situation was very contrasted across markets. In the first half of 2021, the whole US market was booming, with demand at +24% compared with 2019. Urban demand to be back to 2019 levels in 2023. 20 were great for traditional vacation rental markets (rural, coastal, and mountain) but cities are coming back. Yet, as demand flows back to cities in 2021, smaller places in cities will be booked again, driving down the overall average of the market. This is what Airbnb is seeing for summer 2021 in its data: Larger accommodations that can cater to 5 guests or more accounted for 35% of summer nights stayed in 2019 and now account for 54% of summer nights booked in 2021. These large, in-demand places have a higher ADR than urban rentals.

In 20, a lot of small urban apartments sat empty, while people were booking large family-friendly vacation rentals in rural and coastal markets.

Yet, it also says that the Average Daily Rate will go down in 2022 compared with 2021. As a result, supply has been tight in 20 in traditional vacation rental markets.ĪDR will go down in 2022 … not because rates will go down, but because smaller urban units will be booked again and drive down the average valuesĪirDNA’s Medium hypothesis states that rates will go up. During COVID, many owners chose to keep their second homes for their use as they were moving away from cities. While they cannot immediately build more properties, they can open up their secondary homes (see more here about the lack of supply in key markets). Less elastic than usual: When demand rises, owners usually find ways to add supply.The overall supply has gone down in cities as apartments were removed from the short-term rental listing sites. Elastic: Owners can choose to turn from short-term to long-term stays.It is less true for urban short-term rentals. Elastic: In seasonal markets (e.g., ski), vacation rentals close off for months on end.The listing is still there, but it is not an “available listing” anymore. Very elastic: It is very easy to close a property calendar on Airbnb, Vrbo, or Booking.Available supply is both more elastic and less flexible than you can think at first sight: