Market Pulse: US Short-Term Rental Trends

The latest Hospitable Masterclass was designed to help hosts navigate the constantly changing short-term rental market, stay ahead of the trends, and adapt their strategies to remain relevant. Our special guest was Taylor Berry, Director of Business Development at Key Data, which provides vacation rental data and performance insights for the short-term rental industry.

Taylor delivered a presentation and shared with us some insights into the US market trends that the Key Data team has seen for short-term rental hosts over the past year and trends anticipated to shape the market in 2025. She discussed property performance and how occupancy, rates, and revenue change. She also focused on some travel trends and changes in traveler booking behaviors. Taylor also suggested strategies for responding to current market trends to set up your STR business for success. 

Watch the full Hospitable Masterclass to discover the latest insights into the 2024 US short-term rental market trends and look ahead to what we might see in Q1 2025.

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Where Does the Data Come From?

Taylor begins her presentation by explaining that Key Data is a business intelligence and benchmarking tool that integrates directly with 60+ top property management systems, including Hospitable. That means their data is aggregated daily in nearly real-time, and they've got KPIs and visualizations that are instantly updated. She points out that their data is directly sourced from local and regional competitors for comparative data analysis.

"This is so important because other data providers or systems may just pull data from Airbnb, Vrbo, and Booking.com, and we call this advertise data because these are those listed rates. This is what you're seeing: the calendar is blocked out. But is it actually booked by a guest? So, the direct source data is critical with making sure that you have accurate insight into your market."

Key Performance Indicators for the US STR Market

In the introduction, Taylor shares insights into KPIs users often see throughout Key Data's reporting.

Looking at the United States annual adjusted paid occupancy, Taylor notes that annual occupancy has leveled out. The total for 2024 (45%) is slightly pacing ahead of 2023, but it is 5% higher than in 2019, down from its peak in 2021 (50%).

2024 ADRs are lower than in previous years but higher than in 2019. The total 2024 ($309) is pacing slightly ahead of 2023 ($306). Still, adjusted for inflation, 2024 rates are similar to 2019 rates.

2024 RevPAR ($139) is slightly pacing ahead of 2023 ($136), just like occupancy and rates. Taylor underlines that RevPARs are overall indicators of performance. "Consistent occupancy and your consistent rates will provide you with consistent RevPARs. Your goal is always to have that high equal to or higher than what it was in previous years."

US Short-Term Rental Trends by Region

As the presentation goes on, Taylor takes a closer look at the US short-term rental performance at the regional level. Based on direct data booked by November 24, we see different trends in different regions:

• An increase in supply and a decrease in demand (New England, Rocky Mountain States, in Southeast US, Southwest US)
• A decrease in demand and a decrease in supply in the Hawaiian Islands
• An increase in supply and an increase in demand (Mid-Atlantic States, Western US)

Looking at the occupancy in all these regions, Taylor points out that in 2024, it's mostly higher than in 2019. However, the Hawaiian Islands have struggled since the wildfires in 2023, and New England and Western US are flat with 2019. Taylor explains that it's "again to be expected as we're going back to that normal, and 2024 is going to be that baseline moving forward occupancy."

Taylor recommends hosts track occupancy for their local markets to understand how their properties perform against the competition. "If you're not looking at market data, now is the time to get your hands on the wheels here. And make sure you're focusing on all of that. You might be doing this manually if you don't have Key Data Dashboard."

Average daily rates in all US regions except the Midwest are higher in 2024 than in 2019. ADRs are lower in the Hawaiian Islands as they try to drive occupancy back up. Rates are also higher in urban markets, while overall, in the US, they are consistent with 2023.

Looking at the RevPAR by region, Taylor points out that 2024 RevPAR is mostly consistent with 2023. "That's a good sign, so even though we've noticed things going down or up, we're continuing to hit that equal number here. RevPAR is going to drive your 2025 revenue management strategy. You need to make sure you're focusing on this," Taylor emphasizes.

Taylor also provided insights about travelers' booking behavior, including average length of stay, booking window, and booking sources they use. She also suggested effective strategies hosts and property managers should use to respond to travelers' booking behavior changes.

Watch the full Hospitable Masterclass to learn more about the current US STR market dynamics, how they may impact your rental performance, and how to react.