The Next Battleground in Short-Term Rentals: Amenities

28.08.2024 - 23:20 / skift.com

Some say a new form of “keeping up with the Joneses” is changing the short-term rental game. 

With an increasing number of hosts offering a ballooning number of listings, the pressure to stand out to attract guests is more intense than ever. And for many hosts and property owners, the answer is to invest in more amenities, according to Mark Lumpkin, owner of STR Cribs, a company that outfits short-term rental properties with high-end amenities.

“You used to be able to grab a three-bedroom, two-bath, throw an air mattress and a hot plate in it, throw it up on Airbnb and make a bunch of money,” Lumpkin told Skift. Now, guests “want that property to be part of their experience, it’s not just a place to rest their head.”

The result, in Lumpkin’s words, is an “amenities arms race” – an ever-growing battle for guests that’s resulted in more and more listings boasting an array of amenities, as simple as full-length mirrors in bedrooms and as luxurious as hot tubs and golf simulators.

The post-pandemic travel boom has changed traveler expectations of lodgings, says David Krauss, co-founder and CEO of Rent Responsibly, an advocacy group for short-term rental hosts. Krauss calls it a “revenge travel” generation, with cooped-up travelers seeking stunning, brag-worthy vacations at “travel thirst-trap” locales tailor-made for social media. 

“It’s no longer an ‘if you list it, they will come’ industry by any means,” Krauss told Skift. “You need to create an experience.”

Hosts are feeling new pressure to understand their target audience, what amenities that audience expects and what amenities would exceed their expectations, Krauss said.

“That’s the maturity level that we’re seeing hosts have to level up to,” Krauss said. “If you don’t have the interest in investing in your property, or perhaps the economics just aren’t working, there’s actually a little bit of a flight as a result of people who aren’t keeping up with the times and keeping up with the Joneses.”

Hosts and owners willing to invest in developing properties with high-end amenities are likely to see benefits. A March analysis from AirDNA found that listings with pools and hot tubs had higher revenues and occupancy rates than listings without them. Luxury and upscale listings with those amenities saw more pronounced revenue benefits than budget or economy listings, suggesting guests in the higher-end market expect and are willing to pay for top-notch lodgings.

In a data case study provided by Lumpkin and assembled by the group STR Search, two highly amenitized five-bedroom properties in Bradenton, Florida featuring pickleball, mini-golf and other resort-style amenities each brought in more than $170,000 in revenue last year against the market average of