Last minute vacation rental bookings: data on value, trends & challenges

As a result of the challenge of maximizing occupancy, property managers strive to attract last minute vacation rental bookings. These reservations can add operational stress, and are of course by their nature priced differently, so they are worth tracking and maximizing in terms of their value. In this article we discuss Transparent vacation rental data obtained for a collaboration with GetawayGoGo, with analysis of bookings within 0-7 and 8-14 days as last minute bookings compared with those made with longer lead times:

How significant are last minute vacation rental bookings?

By our definition of a last minute booking – within 2 weeks of check in – they represent 37% of bookings on average across world regions. 

In Latin America, 50% of reservations are secured within 2 weeks of check in in fact. Even in the US, where the proportion is lower, last minute bookings account for 30% of all bookings – still very significant. This vacation rental data illustrates why last minute pricing and operations are critical to maximized vacation rental revenue for property managers.

Prominence in different markets

When we look at the significance of last minute bookings across different market types by % share of reservations, we see that predictably, urban markets have a much higher proportion of last minute bookings. A huge 91% of urban reservations are made within 2 weeks of check in.

Of course, markets with traditionally higher leisure quotas see longer average booking windows along with their typically longer length of stays. Beach/lake, rural and ski markets all currently see around 30% of bookings secured within 2 weeks of check in. It will be interesting to see how the rise of bleisure travel and remote working will impact this trend in the coming months.

The value of last minute vacation rental bookings

So we can see that the proportion of bookings made within 2 weeks of check in is extremely significant (especially if you’re an urban vacation rental property manager). However, does it follow that these reservations represent significant value? This is important as they tend to bring more stress operationally to property managers. In terms of the value brought, we look at 2 vacation rental data metrics – ADR and length of stay.

How does last minute vacation rental booking ADR data compare?

For the average daily rate (ADR) of last minute bookings, we consider entire home short-term rentals with 2 bedrooms in the US. In the below chart we consider the difference in pricing for reservations of different lead times. With a split of 15 days or more lead time we can see a significant difference in ADR across bookings.

Given that 0-7 days and 8-14 days lead time show very similar pricing, the below chart looks at the percentage difference in pricing for bookings made within a week of check in, versus those made with more than 2 weeks notice.

Interestingly, the US and Europe are very aligned here, showing a 15%/17% reduction in ADR for last minute reservations respectively.

Length of stay variation through different booking windows

Beyond a reduction in ADR, our next chart illustrates a dip in average length of stay according to booking lead time also. In each case for US and Europe, bookings are around 2 days shorter on average when confirmed last minute.

Both of these things culminate in a much lower average booking value. For example, a reservation made at a US vacation rental within 7 days of check in will return an accommodation fare of $880. Compare this to a reservation made more than 15 days in advance, which will return $1694. That’s almost double the revenue for a property manager.

Significance & value versus operational challenges

Ultimately we can see that whilst last minute bookings present a much lower relative revenue prospect, they also represent a very significant proportion of occupancy for property managers – especially for urban operators or those in Latin America! This makes them particularly important to optimize for. 

By ensuring your last minute pricing is optimized against competition and is proactive to changes in demand, you ensure that every last penny is earned from these bookings. Additionally, tightening up on operations related to bookings that may even come within hours of arrival will mitigate an potential increase in costs (late notice cleans or check ins), and any risk of reviews being less positive (an important driver of occupancy and rate in general).

These reservations are worth the effort. Even though they tend to be lower in value, nothing is more draining to bottom line than empty availability. In the US alone 175,402,760 available nights went unbooked in 2019. At our last minute ADR that totals $35,080,552,000 of revenue up for grabs. So, why not start by optimizing your revenue management practices to boost these reservations? Explore how data can help:

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