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The rapid evolution of the U.S. vacation rental industry has captured the attention of travel companies, media and investors, and inspired a surge of traveler interest in online vacation rental. As the real estate and hospitality industries rebound from several years of economic uncertainty, disruptive new entrants, shifting vacation rental technology, and rising consumer expectations are shaking up the vacation rental landscape.
PhoCusWright's U.S. Vacation Rentals 2009-2014: A Market Reinvented provides a comprehensive look at the U.S. vacation rental market. The report tracks the dramatic changes that have reshaped vacation rental over the past several years and identifies the trends that will impact the industry in the years to come.
- Sizing and forecasts for the U.S. vacation rental total and online markets (2007-2014)
- Key players and market structure
- Characteristics of vacation rental guests and trips
- The evolving dynamics of rental-by-owner (RBO) and professionally managed market segments
- The future of online marketing, transactions, and payment
- Online shopping behavior and the role of search
- Technology challenges, opportunities and trends
Table of Contents
Introduction and Overview
What is a Vacation Rental?
About This Study
Key Terms and Definitions
Vacation Rentals: Background and State of the Category
Size and Structure of the Market
Supply, Demand and Revenue
Management Method: RBO & VRMC
Traveler's Choice: Destinations, Vacations Style and Trip Spend
Other Characteristics of Vacation Rental Trips
The Vacation Rental Decision
The Vacation Rental Guest: Who They Are and Why They Book
Homeowners: A New Breed
The Changing VRMC Landscape
Online Market and Forecasts Not Booking, but Looking: Online Research
Online Distribution: New Models, Challenges and Consumer Expectations
The Rise of Online Listing Sites
Distribution: Rock or Hard Place?
Distribution: Square Peg or Round Hole?
Booking, Spaces and Social: The Airbnb Phenomenon
Managers in the Middle: The VRMC Decision for Homeowners and Travelers
The Homeowner's Decision
No End to Disruption
Partners and Sponsors
LIST OF CHARTS
U.S. Online and Total Market by Segment, 2012
Size of the Market 2012: Supply, Demand & Revenue
Key Market Metrics, 2007 and 2012
Supply and Demand by Management Method, 2012
Share of Accommodation Type by Demand (Trips) and Supply
Share of Available (Supply) and Rented (Demand) Unit Nights by Region
Vacation Style for Last Vacation Rental Stay
Vacation Rental Consideration Among Leisure Travelers
Reasons for Choosing Vacation Rental Over Other Accommodation Types
Number of Years Renting
VRMC Population by Number of Units
VRMC Current Offering or Use of Select Technology
U.S. Vacation Rental Online and Total Market and Online as a Share of Total Rental Revenue, 2007-2014
Mean Length of Stay, Rental Spend and ADR by Method of Finding and Booking Last Vacation Rental
Information Sources for Researching Vacation Rentals, 2008 and 2012
Monthly Unique Visits to Vacation Rental Listing and VRMC Website Categories, November 2010 - August 2012
Average Monthly Unique Visits to the Nine Largest Vacation Rental Category Websites, January - August 2011 and 2012, and Average Annual Change
Vacation Rental Market Revenue by Channel, 2012
VRMC Distribution Economics
Importance of Website Features in Researching Vacation Rentals
Primary Residence Renting by Vacation Type and Number of Years Renting
Services Offered to Rental Guests by VRMCs
Reasons RBO Owners Do Not Use a VRMC
Reasons Owners Use a VRMC
Homeowner Use of Management Method (RBO vs. VRMC)
Preference for Working with Homeowner vs. VRMC in Booking a Vacation Rental
Attributes/Features of Rental Stay - Association With RBO vs. VRMC
To ensure that the study captured all stakeholder perspectives, PhoCusWright employed a 360-degree approach, conducting a mix of surveys and in-depth interviews with consumers, vacation rental management companies (VRMCs), homeowners, technology providers, and travel intermediaries (vacation rental websites, online travel agencies, traditional travel agencies and wholesalers). PhoCusWright also partnered with leading web analytics firm Experian Hitwise to conduct website traffic and pattern analysis.
PhoCusWright conducted three extensive surveys, targeting consumers, vacation rental homeowners and VRMCs.
- Population: U.S. adult travelers at least 22 years old who have stayed at a vacation rental property at least once in the past two years, and had a role in the vacation rental trip planning process
- Rental properties include homes, condos, villas, cottages, timeshares (as used by renter, not owner)
- Source: Global Market Insite (GMI); 1,072 qualified responses
- Results are projectable at a 95% confidence level with a 3% margin of error
- Population: Vacation rental management companies
- 192 qualified respondents sourced through study partners: Vacation Rental Managers Association, HomeAway, LeisureLink, VacationRoost
- Results are projectable at a 95% confidence level with a 7.1% margin of error
Vacation Rental Homeowners
- Population: Individual vacation rental home (unit) owners
- 411 via independent online panel Global Market Insite (GMI) and 289 via HomeAway
- Both independent (GMI) and combined samples used selectively. The combined sample (identified as "weighted") is weighted to reflect the mix of homeowners by rental management model from the natural incidence occurring via the GMI sample:
- 41.5% RBO
- 32.5% VRMC
- 26% dual method (both RBO and VRMC)
- GMI results are projectable at a 95% confidence level with a 4.9% margin of error
- VRMC Interviews: In-depth interviews conducted with 10 select vacation rental management companies (VRMCs) representing a range of sizes and geographic locations
- Homeowner Interviews: In-depth interviews conducted with 10 select homeowners representing an even mix of rental management models: three rental by owner (RBO); three who use vacation rental management companies (VRMCs); four who use both methods (RBO and VRMC)
- Technology and Distribution Interviews: A series of executive interviews across technology and distribution companies spanning vacation rentals and travel, including: vacation rental listing websites, online travel agencies and tour operators; property management technology and distribution system providers for VRMCs; and emerging technology and online players within the vacation rental arena
PhoCusWright designed a multifaceted approach to market sizing by supply, demand and revenue. Three components comprise vacation rental sizing:
- Supply: Vacation rental units and available unit nights located in the U.S.
- Demand: Nights those units are occupied
- Value: Rental revenue generated from those units
PhoCusWright generated sizing estimates from surveys, company interviews and a comprehensive review of company reports and available third-party data sources.
Where possible, this report presents segmentation of the market by several key areas:
- Unit type (single-family home versus condo, etc.)
- Vacation style (beach/ocean, mountain, golf, ski, etc.)
- Management method (VRMC versus RBO)
- Booking method (online versus offline)
Traffic Stream Analysis with Experian Hitwise
PhoCusWright and Experian Hitwise jointly evaluated 300 websites in the vacation rental marketplace. PhoCusWright developed a custom vacation rental category of 300 websites from more than 600 URLs and created two subcategories: vacation rental listing websites (22 URLs), and VRMCs (278 URLs). Sites were included based upon their relevance to vacation rentals according to the PhoCusWright definition and size (measurable, monthly unique visits).
WyndhamVacationRentals.com and TripAdvisor.com/vacationrentals are included in the aggregate category rankings, but are excluded from individual site rankings due to limited historical data. They are both among the 10 largest vacation rental sites as of November 2012.
Hitwise's proprietary software analyzes website logs via Internet Service Providers (ISPs) to develop online activity metrics including page requests, visits, average visit length and search terms. This data is augmented with data provided by opt-in panel partners to form aggregated analysis of consumer Internet usage. For more on the Hitwise methodology, visit: http://www.experian.com/hitwise/hitwise-methodology.html