This was the year that all the occupancy gains from the short-term rental boom went away. Demand for short-term rentals declined in the U.S. as Americans opted for overseas trips and cruises.
08.12.2023 - 10:47 / skift.com / Brian Chesky / Dennis Schaal / David Goulden / Dave Stephenson
Booking Holdings Chief Financial Officer David Goulden said this week that the flagship Booking.com brand launched its short-term rental business as a supplement to hotels “15-plus years” ago, which is roughly around the time Airbnb got going in San Francisco.
But Booking.com’s business line revolved mostly around apartment hotels in Europe while Airbnb focused on owners and tenants renting out apartments in U.S. cities.
Airbnb, as a private company, became a break-out leader in part because it didn’t worry as much about local regulations. Booking.com, as a public company, was more cautious.
Booking.com’s short-term rental business – which it still refers to as “alternative accommodations” – remains heavily weighted toward its European base. Goulden went into more detail than usual at an investor conference earlier this week about the company’s Europe-U.S. disparity.
In the third quarter, he said, one-third of Booking.com’s bookings came from short-term rentals, and the segment grew 24%. That was two times faster than the growth of its core hotels business.
In Europe, the short-term rental business is even more than one-third of the mix – “a fair amount” higher, Goulden said. In the U.S., it’s a “a fair amount lower.”
“The main reason is that we’ve been doing alternative accommodations in Europe for 15-plus years, and we are several years behind that in terms of just time of evolution in the U.S.,” Goulden said. “So we’re probably seven or eight years behind that in terms of when we started building out one versus the other.”
Goulden doesn’t expect Booking.com’s U.S. short-term rental business to take another seven or eight years to catch up because it now has more experience.
Booking.com’s U.S. listings grew faster in the third quarter than the company’s 9% overall growth in that sector, and it outpaced every other region, he said.
“The U.S. continues to be a big – a key focus for acquisition” of listings, Goulden said. He added that the company will continue to aim to make the U.S. its fastest-growing market for supply.
Over the years, Booking.com has opted to sign on property managers who may have hundreds or thousands of listings, as opposed to signing on individual hosts.
Booking.com doesn’t break out listings by region, but Goulden said there were 7.2 million listings in total in the third quarter.
While Booking.com strives to grow its U.S. short-term rental business, Airbnb is focused on growing its business outside North America, and announced looming changes in its executive ranks this week to foster that growth.
In the announcement about the C-suite changes, including Dave Stephenson’s transition from chief financial officer to chief business officer, Airbnb CEO Brian Chesky said:
This was the year that all the occupancy gains from the short-term rental boom went away. Demand for short-term rentals declined in the U.S. as Americans opted for overseas trips and cruises.
Hawaii Governor Josh Green has asked for 3,000 condos and homes operating as short-term rentals to be converted into long-term housing for those displaced by this summer’s wildfire in Lahaina.
Hawaii Governor Josh Green said he is ready to “drop the hammer” or go “nuclear” on short-term housing rentals on Maui.
Taylor Swift’s Eras Tour made headlines even before it began — by overwhelming booking platform Ticketmaster and drawing attention even from the U.S. Senate.
Dealmaking has kept short-term rental businesses in Europe busy. The past few months have seen an uptick in activity — be it mergers, or acquisitions or rebrandings.
Fake signs warnings of bedbug infestations are being used to deter tourists in Athens, Greece.
This is not a story of “Airbnbust,” but instead we’re talking about a correction of the “Airbnboom” that has taken place since the highs of the pandemic.
Happy Thanksgiving, folks! I know you’d rather carve a turkey than open your inbox, so we will keep this brief.
You read it here first: We’re halfway into the year, and the short-term rental industry has been buoyed by summer travel picking up, despite prevailing economic uncertainty.
Stat of the Day: Thinking that you, like us, are wondering what’s happening to occupancy levels this summer, we had some numbers crunched for us by data analysis firm Beyond Pricing and this is what it found: U.S. occupancy for July is pacing about 5 percentage points down year-on-year, from 37 percent in 2022 to 32 percent in 2023.
New This Morning: Following extensive discussions within the community spanning almost four years regarding short-term rental homes, the Dallas City Council implemented zoning limitations to prohibit their presence in single-family neighborhoods last week. However, as a middle ground, short-term rentals will still be permitted in commercial areas and multi-family neighborhoods.
If you’ve seen a tweetstorm about the alleged “Airbnb collapse” and are wondering if the data seems too dramatic – you’re not alone, or even wrong.