Vacation Rental Industry Showing Signs of New Life as Restrictions Ease
The vacation rental industry is showing signs of a rebound as social distancing restrictions ease, and travelers are settling into a new norm.
Bookings at some online travel agencies increased the last half of May and into early June, even eclipsing the number of reservations from the same period in 2019. But travel habits have changed, reflecting a more cautious and less extravagant approach.
Vacationers are foregoing lunch at a Paris sidewalk café and instead choosing venues closer to home and within driving distances. Vacations are more spontaneous and longer as travelers combine stay-at-home work with some downtime.
Week-long stays at popular international travel destinations are getting traded for a month at a lake resort reached by car, said one top Airbnb, Inc., officer in an interview with Bloomberg.
Also, professionally managed accommodations and cleanliness are key factors when travelers choose their destination.
Americans are getting back in the vacation mindset
Vacasa’s interim CEO Matt Roberts told CNBC that people want to get out of their house but stay in a home with a change of scenery. Because of remote working arrangements, travelers are being more flexible with their destinations and are often waiting until the last minute to make plans.
Vacasa has seen a spike in bookings for vacation homes near lakes and the distance people are driving is down 27 percent.
“People are looking for that very close proximity and for some remote destinations,” Robert said in an interview with CNBC’s Seema Mody.
Beginning in mid-April, Vrbo started seeing signs that U.S. travelers are getting back in the vacation mindset. Vrbo Vice President of Global Business for Property Managers Lisa Chen said in an interview with VRM Intel that Google search data is supporting the trend.
She presented research indicating that travelers are willing to stay in a vacation rental this year and prefer private accommodations with extra space and amenities.
Travel industry beginning a new normal
The latest trends are following suit with predictions about the effects of COVID-19 on the travel industry as states begin reopening for business.
Experts believe travelers will prefer driving over air travel, staying in vacation rentals rather than hotels and go with trusted industry sources for booking reservations.
The embattled airline industry saw a slight increase in bookings over the Memorial Day weekend.
Major airlines are attempting to climb out of a deep hole resulting from cancelations and lost bookings attributed to the coronavirus and lagging consumer confidence. As the pandemic began to spread, airlines came under fire for resisting refunds for canceled flights.
The industry faces a long road ahead gaining the confidence of travelers but is making strides.
Recently, a contingent of U.S. senators introduced the Cash Refunds for Coronavirus Cancellations Act of 2020. The legislation would require major carriers and third-party ticket sellers to refund money in cash for any tickets canceled during the pandemic.
One lawmaker estimates there is $10 billion in potential refunds.
Christian Nielsen, who is AirHelp’s Chief Legal Officer, told CNBC that the bill will go a long way toward bringing travelers back to the air.
“I applaud it, and it’s a step in the direction of trying to improve consumer confidence.”
AAA seeing indications of planned vacation travel
AAA plans to resume travel projections after skipping its Memorial Day forecast for the first time in 20 years. The travel organization plans to issue a forecast for late summer and fall, and already there is optimism.
As attractions like amusement parks and other popular family destinations begin reopening, Americans are going online to begin planning vacations.
“The saying goes that the journey of a thousand miles begins with a single step,” said Paula Twidale, who is Senior Vice President of travel at AAA. “Americans are taking that first step toward their next journey from the comfort of their home by researching vacation opportunities and talking with travel agents.”
AAA also notes that the national average for gasoline is slowly climbing, an indication that the petroleum industry anticipates more travel over the summer months. For a little over two months, the national average was at its lowest in decades at $1.76 per gallon but the price jumped in the first week of June at the start of the summer season.
While prices are going up, they will remain a bargain for travelers who want to hop in the car and travel to a nearby overnight attraction.
“We are seeing that Americans are showing preference and inspiration to explore all that our country has to offer as soon as it is safe to travel,” Twidale said.