Which are the top performing US vacation rental markets attracting higher demand through current challenges?
We’re all well acquainted with the detrimental impact to the vacation rental industry as a result of the COVID-19 pandemic. At the beginning of April last year, US reservations were down 94% on 2019. Some areas however, have climbed out of this abyss, and through 2020 have secured more reservations than 2019. So which are the top performing US vacation rental markets currently booming?
Impact to vacation rental reservations across United States
Looking at the states as a whole, we can paint a picture of the current state of recovery with the map below. While states are at the mercy of local restrictions and regulations, not to mention the severity of case numbers, they also attract different demand.
As demand shifts towards non-urban destinations and becomes almost entirely domestic, it favours more appropriate regions. Those with an existing, strong domestic contingent or better furnished with popular non-urban opportunities reap more benefits than their international or urban inclined neighbors.
You’ll notice for example that West Virginia, ‘The Mountain State’, is currently enjoying the highest year on year reservations of all US states, with 67% more reservations than at the same time in 2019. Being situated entirely in the Appalachian Region, West Virginia is almost entirely mountainous and ripe with rural retreats. So we can see which states are fairing better, now let’s looks at top preforming US vacation rental markets .
Top performing US vacation rental markets
We took the top 200 US markets by number of vacation rentals, to ensure we were looking at significant destinations, and reviewed their reservations throughout 2020 compared with those of 2019. As a result, we’re looking at the 20 top performing significant markets in the US year on year.
By broad market classification, our top 20 contains 16 non-urban markets, including lake/beach, ski and rural areas, and 4 urban markets.
Lake Havasu City is one of our urban contenders. However, it’s known as a base for trails in the nearby desert and water sports on Lake Havasu. Further, El Paso, is also located in the desert and boasts the Franklin Mountains and Franklin Mountains State Park, one of the largest urban parks in the United States. It is therefore worth noting that even areas typically noted as urban may have non-urban attributes boosting demand.
Overall we can agree that top performing vacation rental markets in the US in 2020 are predominantly of a non-urban classification.
Top 5 US vacation rental markets in 2020
Broken Bow, Oklahoma is a gateway to Beavers Bend State Park, home to black bears, bald eagles and pine forest trails, while Broken Bow Lake provides beaches, watersports and fishing opportunities. It has seen a huge 82% increase in reservations in 2020.
Famous for its sublime coastline, pristine waters and abundant wildlife, Panama City, Florida has enjoyed 55% more reservations than in 2019. It is a prime beach destination offering scuba diving, fishing and cruising activities.
Oak Island is a beach town in North Carolina. Its Atlantic coast is lined with fishing piers, and has attracted 49% more guests with its beaches, coastal walks and local nature trails.
In 2020, 46% more reservations were made in Whitefish, Montana, a resort town in the Rocky Mountains. Gateway to Glacier National Park, ski and mountain-bike trails wind downhill at the mountain resort. Meanwhile, lakes and beaches sport boat launches and picnic areas.
Finally, Hot Springs, Arkansas is a city in the Ouachita Mountains known for naturally heated springs, many of them in Hot Springs National Park to the north. Year on year reservations were up 41% overall in 2020 as guests sought out remote relaxation.
2021 occupancy outlook for top performing US markets
When we look at the first 3 months of 2021, we can see that the occupancy on the books is significantly higher for all of our 5 top markets through 2020. Panama City is the only destination of our top 5 with a less than 50% average increase in Q1 occupancy.
Moreover, against the urban reference point of LA, whose overall on the books occupancy is 10% lower than this time last year, we can see a real contrast. On average, our 5 markets have an average of 105% more occupancy on the books at this stage.
Why are some US vacation rental markets booming?
While the pandemic has thrown shackles around life as we know it, the travel demand paradigm has shifted. What people are allowed to do, and what they want to do, has fundamentally changed, more domestic guests to less urban vacation rentals for longer stays.
As a result, those markets best feeding those types of demand have seen their booked trips soar. Our 5 top performing US vacation rental markets all cater to guests seeking the great outdoors; beaches, lakes, mountains, desert, hot springs and national parks. Even our top 10 are vast majority rural or rural gateway markets.
In addition, the Q1 outlook for 2021 looks incredibly strong compared with this time last year. All the indications are that this trend will surely persist for the full duration of travel risk and restrictions – if and when it shifts back remains to be seen.
Visibility over demand data and pricing in different segments has never been more critical to staying ahead of your competition and boosting revenue. Search your area with our free dashboard or book a market consultation with our Smart Rental PRO experts.