Regional Vacation rentals experiencing strong demand despite economy

Vacation rentals have often promoted themselves as a more economical and personal lodging option compared to hotels. Often these claims are backed by hard daily rate data and thus it’s not a stretch to conclude the current economic climate may have less of an impact on the vacation rental market compared to more standard travel and lodging categories. In general I would agree that vacation rentals are more insulated from the economy compared to hotels, but like most things in life “it depends.”

Aspen Feeling the Effects  regional_vacation_rentals

I was able to attend an educational session held by Liza Hogan of Resort Rating Specialists at last week’s Annual VRMA Conference. Liza helps VR managers institute rating programs that help accurately market vacation rental units, but also provide structure and guidance to help owners invest appropriately in upgrading/maintaining their properties. As such, Liza is a recognized expert in the space and has collected data points and case studies across the country. During her presentation Liza mentioned Aspen, CO was preparing for a “down” season and was only at 50% occupancy for the holiday season as of mid-October. Typically, premier ski destinations, such as Aspen, are nearly completely booked for the holiday by the end of October.

With most Colorado ski resorts within a 2 hour drive of Denver, Aspen’s western location (4 hours from Denver) doesn’t play well to the regional market.  Instead Aspen is a magnetic for the out-of-state family…. Thus, tack on a plane ticket, extra baggage charges (over $100 if you bring your gear on most airlines) and a car rental and suddenly you have a pretty expensive trip, vacation rental or no vacation rental.  Destination markets like Aspen are inherently vulnerable during these times.

Regional Markets Seeing an Increase in Bookings

In contrast, I had a separate conversation with a reservation manager in the White Mountain region of New Hampshire who indicated they had seen a year-to-date 9% increase in bookings. Apparently, many of the folks in Boston and New York are still planning on going skiing, they just aren’t going to fly anywhere to do it. As such, ski areas like Loon, with its proximity to several large cities, is yielding an increase in vacation rental demand.

Ultimately, vacation rentals, in general, will fare better than most travel categories in the current economic environment.  However, for every two markets that are benefiting from a change in travel plans/preferences there is likely another market struggling.

2 COMMENTS

  1. It is great to see vacation rentals performing well in a tough economy. The Outer Banks occupancy is up from last year as well. According to the Outer Banks Visitor Bureau, occupancy as of August 2008 is up 13.9 from August of 2007, and the numbers for January to the end of August were up 3.9%. Vacation rentals offer a great alternative to hotel stays, and there is still a lot of room for growth in the vacation rental industry.

  2. Here at Topsail Island, we actually had a better year than last year for the summer season although this year the season started about two weeks late and the bookings were closer to the time of their arrival. I supposed it was that everyone was counting their money and saving up. Next year, who knows what to expect with the economy but at least fuel costs are dropping. This article does have some encouraging news though

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