Pandemic Shift: How U.S. Vacation Rental Regions have been Affected

As the Vacation Rental Industry continues to recover from the effects of the COVID-19 Pandemic, many markets are seeing a deviation from their expected rental occupancy. Since the peak virus case count, states have lifted travel bans and restrictions at different times. Employers and schools also enacted remote work and learning policies, causing influxes of travelers during historically slower shoulder seasons from new, or different, feeder markets. In order to look at these changes, we need to acknowledge how the pandemic also helped strengthen the importance of re-defining the traditional occupancy calculation. 

Unlike traditional calendar occupancy, adjusted paid occupancy takes into account owner stays, maintenance blocks, or blocks inspired by other factors such as state regulations and restrictions; all of these amount to non-revenue generating nights. Although almost all states have relaxed their stay-at-home orders and have allowed visitors to return, there are still a few states who have short-term rental restrictions in place. Most states also still have restrictions for the number of people allowed in restaurants, theaters, grocery stores, and other attractions, all of which can be critical to vacationers.

If we remove these non-revenue generating nights by using the adjusted paid occupancy rate, we are able to see a clearer picture of how the occupancy rate is shaping up compared to 2019. We looked at a few different regions in the United States to see what the occupancy rate has been so far in 2021 and what’s to come at the beginning of the summer season.

 

Southeast United States

Regional Webinar - APO Article - Southeastern US

In the Southeastern United States, adjusted paid occupancy started the year relatively similar to 2019. However, between mid-February and mid-April, 2021 averaged 12.9% higher than in 2019. The difference in spring break performance is also notable; with the March and April adjusted paid occupancy rate increasing almost 22% over 2019. 2021 is pacing ahead of 2019 through the beginning of July, by an average of almost 20%. In fact, 2021 pacing performance is even ahead of 2019 final performance until mid-July. With an average booking window of roughly 52 days so far in the Southeast, there is a strong probability that 2021 performance will outpace 2019 final figures for most of the year.

 

Southwest United States

Regional Webinar - APO Article - Southwestern US

In the Southwestern United States, 2021 has outperformed 2019 by roughly 17% from mid-January through mid-April. This is especially impressive in contrast to the Southeast, where the early months performed closely to 2019. For the rest of April through mid-July, 2021 is projected to outpace 2019 by an average of 12.7%.. The Southwest does tend to be more of a year-round destination, because of the mild weather in the winter and the many parks and outdoor activities in the summer. 

 

Northeast United States

Regional Webinar - APO Article - Northeastern US

Another typically year-round travel destination in the United States is the Northeast. Vacationers enjoy many snow-sport activities in the winter and early spring months, mild weather in the summer, and leaf-peeping in the fall. However, these winter months can be extremely snowy, and don’t attract the vacationers looking to stay warm. This region was particularly impacted by the pent-up demand for getaways after stay-at-home orders were lifted, and saw an increase in guest occupancy by an average of 18% over 2019 so far this year. Additionally, the region is pacing about 20% ahead of 2019 between mid-April and mid-July.

 

Northwest United States

Regional Webinar - APO Article - Northwestern US

Finally, we reviewed the adjusted paid occupancy rate for the Northwestern United States. So far this year, 2021 figures outperformed 2019 by an average of 17%. The Northwest is not pacing as far ahead of 2019 as some of the other regions are, at 13%, but with an average booking window of about 30 days, this difference can easily be made up. 

Overall, each region we reviewed saw a significant increase in paid occupancy this year over 2019, especially during the spring and summer season. Some of this increase can be attributed to typical year-over-year growth, but as the COVID-19 pandemic slows, the popularity of vacation rentals has been heightened; especially in markets that are accessible by car. Reviewing paid occupancy, in this case, was critical because of the impact owner stays and holds can have. Year-to-date, hold occupancy is averaging almost 16%; a 5% increase over the same time period in 2019. Generating revenue reports that fail to take this information into account can be detrimental to revenue estimates and the performance you report to your owners. 

Over the last 6 months, the United States has seen a 40% increase in guest reservations over 2019. Additionally, so far in 2021 the Average Booking Window has decreased to 47 days from 68 days in 2019. Do you have access to a dashboard that can provide this information to you? Contact us at data@keydatadashboard.com to see how we can help you get additional data at your fingertips!

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