Short-Term Rentals Are Getting Popular Again. Here’s Why

By Christopher Elliott

When you book a short-term rental from Tabas by Blueground in Rio de Janeiro, you get an apartment that feels more like a resort. Everything from the furniture to the towels is standardized. Linens, soap, bedspread — it’s all so hotel-like.

“We have our standards,” says Leonardo Morgatto, Tabas’ CEO.

He’s not alone. If you rent an apartment in Los Angeles with Landing, you’ll find the same resort amenities, including soaps, dishes and bedspreads. You can also check in with an app. (Landing even has a Nomad Pass, which includes a partnership with Frontier Airlines, that offers unlimited flights and stays across any of its apartments for $1,495 a month.)

Short-term rentals are getting popular, and it’s not just because they’re adopting more hotel amenities and features. If you’ve looked for a reasonably-priced hotel, then you know why. Lodging rates will increase almost 7% on average in 2024, according to research by BCD Travel. In some cities, they’re already in record territory. That means travelers are trying to find other options.

Long-term rental options like Tabas by Blueground or Landing often have minimum stay requirements. But in a world of flexible work, many travelers are willing to fit their schedules around rental opportunities. That might mean taking a sabbatical or an extended summer break or a workcation.

“Rising hotel costs have driven more interest in apartment or home rentals,” says Susan Sherren, founder of the travel agency Couture Global Trips.

“Everything a hotel has”

Shelley Hunter, an innkeeper from Quincy, Calif., recently tried to find accommodations in Anna Maria Island, Fla., a popular seaside vacation destination. The hotels were way outside her budget, and they were landlocked. Then she found a rental through Vrbo.

“We were able to get two bedrooms and two bathrooms with a separate kitchen, dining and living room,” she says. “We just could not find a hotel at any reasonable price that could offer anything close.”

Her property was also on the beach, with ocean views. Plus, there were the hotel amenities.

“It has everything a hotel has — soaps, towels and a coffee maker,” she says.

What do the newest short-term rentals have?

“There’s been a big shift in the vacation rental landscape,” says Danielle Finch, director of customer experience at HomeToGo, a vacation rental site. “The majority of vacation homes now offer more standardized amenities, akin to what you would find in a hotel, while also providing a more personalized and authentic experience.”

Among the amenities that have become standardized:

• Contactless check-in, usually through an app.
• High-speed internet.
• Dedicated workspaces.
• Coffee makers.
• Hairdryers.
• Soaps, shampoos and other toiletries.

Even the existing amenities have become more hotel-like. For example, Spectrum Resorts, which manages hundreds of vacation rental units on Alabama’s Gulf Coast, has begun offering a clean bedding guarantee consisting of washing all linens, including duvet covers, between stays. To do this, owners of the units it manages agreed to have standard white bedding provided by Spectrum to replace whatever was previously in their unit.

Long-term rentals have also become more flexible. Property managers now offer more relaxed cancellation policies, which allow travelers to easily adjust their plans.

What short term rentals can do now

There’s a misperception that short-term rentals are hit-or-miss accommodations. But they’ve evolved, and that evolution has picked up the pace after the pandemic.

It’s full service

“Travelers are demanding greater levels of concierge service, amenities and regular maid service,” says Casey Halloran, CEO of Costa Rican Luxury Vacations. The concierge is off-site, accessible by phone, text or WhatsApp. But the maid service comes daily or weekly, depending on the type of rental — just like a hotel.

It’s often less expensive than a hotel

In 2024, a vacation rental is almost always going to be less expensive than a hotel if you have a large group. And owners are often willing to negotiate, says Jacob Murphy, a revenue manager for vacation rentals. “Don’t be afraid to ask,” he says. “You can often get at least 10% off for a week or more.” His pro tip: In most markets you can wait until the very last minute for some really great prices — often much lower than a hotel.

It’s personalized

Whether it’s a large company like Landing or Blueground or an individual owner renting through a platform like Airbnb or Vrbo, short-term rentals have one thing in common: They excel in the personalized service department. “Hosts are eager to please,” says McCall Renold, a vacation rental owner from Livingston, Mont. “Unlike some hotels where you are just another number, at a vacation rental you are a guest and have the undivided attention of your host during your stay.” Renold says she and her husband are always available for any questions or needs their guests have. And they love adding personal touches, like leaving wine or handwritten notes for their guests.

Strategies for booking a short-term rental

If you’re interested in staying in a rental this summer or fall — maybe even for the first time — you need to understand one thing, says Marcus Rader, CEO of the vacation rental software provider Hostaway.

“Most of these homes are, in fact, homes,” he says. “You get all the benefits of a home, such as a kitchen, backyard, privacy, depending on what you prioritize, of course. But just like all homes, things can go wrong.”

With that in mind, he offers the following advice:

• Focus on what short-term rentals do better. Pay attention to the amenities they have but few hotels offer. “You get a better variety in terms of location,” he says. “And you get your own private amenities such as kitchen, rooftop patio, private beach, pool, and hot tub.”
• Standardization is good, but comparing rentals is still hard. It’s still difficult to know if rentals have standardized amenities, he says. “But there are companies trying their best to offer solutions for that,” he adds. “Perhaps part of the joy of staying at a vacation rental compared to a hotel is the fact that you get a true local experience, unlike a hotel chain that tries to be exactly the same whether you are in Singapore, Berlin or Miami.”
• Don’t apply a hotel standard (at least not yet). Maybe you still can’t make an apples-to-apples comparison with short-term rentals, as you would with comparing Embassy Suites to SpringHill Suites, for example. But we’re making progress. For now, Rader recommends finding a short-term rental you like with the amenities you need.

We may be moving to a point where you can compare two different short-term rental companies — and in some markets, that’s already possible. But overall, you still have to do your homework and understand the basic differences between a short-term rental and a hotel.

Short-term rentals have one advantage over hotels

Short-term rentals already experienced one surge in popularity a decade ago, when Vrbo and Airbnb became popular. Back then, travelers discovered that short-term rentals were a way to save money, especially for large groups.

But short-term rentals have one other advantage, which is now becoming apparent, says Pierre-Camille Hamana, CEO of host property management platform Hospitable.

“It’s very difficult for vacation rentals to compete with hotels when it comes to the most substantial amenities. They can’t easily, for example, add a pool, build a restaurant or create a gym,” he says. “But their enduring popularity isn’t really underpinned by these facilities. It’s founded on their uniqueness, the authenticity that only a local host can bring, and the opportunity to self-cater.”

And that makes guests feel like locals rather than someone who’s just passing through.

Via Forbes