The future of vacation rental investment properties is rapidly changing. There is no denying that the rental and vacation industry is witnessing its most aggressive development in recent history.
Just five years ago, if you were sitting with friends and mentioned going on a holiday somewhere, you would be bombarded with suggestions of which hotels are the best to stay at depending on price and luxury as always. These days look far behind now. If you were to go and do the exact same thing now and open the subject with the same group of friends; you will most likely be given suggestions on which Airbnb investment properties are the best ones to stay at. This is how a new industry was born and its future looks bright.
The success of this industry is understandable and very much expected. It is not that the hotel industry has failed or couldn’t provide what we need, but we live in a world where comfort and financial stability are of paramount importance. We like to have options. Vacation rental investment properties are surely going to become the leading market in tourism and vacation bookings taking over from hotels and hostels. There are three main criteria’s that will shape the future of vacation rental investment properties.
1. Competition and Prices
This is most probably the most important factor in shaping the future of rental investment properties as a whole market. The reason that hotels are losing the battle to remain dominant is because they can’t provide the lucrative prices that Airbnb and other platforms offer. This can be explained in simple economic methodology, high demand and high supply.
People interested in real estate investing and with enough capital can purchase investment properties for the sole purpose of renting them as vacation rentals. In return, such properties can be listed on online platforms like Airbnb, and this has created a very competitive scene that almost everyone has benefited from. The price range of Airbnb houses can be best described as when two parties meet half way to reach a positive agreement. Prices are much lower than hotels and luxury resorts that the customers are happy to pay the amounts asked.
At the same time the people who own investment properties are satisfied with the income they are making due to it being higher than traditional rentals in most cases. The predictable future in this category is in favor of vacation rentals. Hotels cannot compete with property owners’ prices because hotels employ so many workers and are required to pay tons of bills. Airbnb has exploited that weakness to their advantage and look where they are now.
Mashvisor can help those looking to invest in traditional or vacation rental investment properties. It allows you to find properties and their relevant data like cash-flow and Airbnb occupancy rate. It is a very useful planning tool to help you budget and manage your future investment properties.
2. Investors and Hospitality
This is a key area in making rental investment properties unique. Owners of properties are going out of their way to come up with innovative and thoughtful ways to increase hospitality ratings in their rental properties.
If you go stay at a hotel, odds are that you will pay double the amount you’d pay at an Airbnb house without getting any hospitable feeling. Hotels gave us a different understanding of hospitality. We used to think room service that costs us three times what we’d normally pay or going to your hotel and finding a bottle of water is considered hospitable. What vacation rental owners have done is challenge this concept and change our perception of hospitality.
I have traveled to many places and have been in many Airbnb homes. The hospitality ranges from the owner cooking you dinner in his upstairs flat to finding a bottle of wine and a box of chocolate when you check in. This is hospitality that appeals to people, that makes them want to do this again. It is particularly why investment properties are so appealing to purchase because people can be creative to become something better and different.
3. Providing Accommodation . . . Anywhere
This area is what will shape the future of platforms like Airbnb. Let’s consider two important facts. First, hotels are not everywhere because of their expensive costs and big size which limits them to be in cities for example. Secondly, the fact that the world is becoming smaller and that borders are disappearing because people travel so much and explore so many countries. This means that rental investment properties have more ability to expand to anywhere, because all it would take is for an investor to purchase a property and list it on a vacation rental platform. I have read some experiences of Airbnb users, some decided to stay in a cabin in the middle of nowhere for the experience of it. I have personally once stayed for three nights on a sailing boat in the middle of Barcelona’s main central port, how many hotels can offer that? These examples shows how vacation rentals have the edge in the future struggle for this market domination.
The future of rental investment properties is projected to be heading upwards for the foreseeable future. Revolutionary platforms like Airbnb have released the shackles from so many people and liberated them to take control of a major industry that has so much growth and potential. The key for investors to grow with it is to be creative and never stop expanding your horizons.