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The Impact of the Coronavirus | Global Short-Term Rental Markets

Coronavirus Vs Global Short-Term Rental Markets

At the time of writing, the coronavirus has killed more than 4,000 people and sickened more than 115,000. International stock markets have witnessed the biggest plunge since 2008, entire cities and countries have been placed on lockdown, and massive international events have been called off.

Without a doubt, standing at the epicentre of the coronavirus is the travel industry. Airlines, hotels, and a fleet of offshoot industries are now coping with the virus’s severe downstream effects.

One particularly curious case study, however, is the evolving interaction between the Coronavirus and short-term rentals. At first thought, a business model that champions the democratization of lodging seems like a virus’s best friend — and one notably at risk.

However, the impact of the Coronavirus on global short-term rental markets is becoming significantly more complex with a good deal of nuances.

In this report, we’re leveraging data from MarketMinder to help evaluate the scope of the epidemic in its entirety. We’ll dive into year-on-year Airbnb trends, real-time updates, and future projections for cities around the world.

If you have any specific inquiries for information on how a particular market may be impacted by the Coronavirus, please reach out to hello@airdna.co

Global Vacation Rental Supply Remains Steady

At this point in time, the total supply of vacation rentals around the world hasn’t responded in any major way to Covid-19. No huge drop-offs, and no massive push to remove properties from the marketplace.

That being said, the year-on-year trend is discernably negative in a springtime run-up that would otherwise see positive supply growth.

As we’ll see below, demand for vacation rentals has suffered some significant setbacks, but the supply trend doesn’t seem to match the noise in the wider travel industry. Expectations may be low, but vacation rental hosts are, for all intents and purposes, open for business.

Airbnb Activate Property

demand for vacation rentals has suffered some significant setbacks – Coronavirus

Demand for Short-Term Rentals Seeing Significant Setbacks

In the chart below, AirDNA has analyzed a handful of cities most impacted by Covid-19 due to event cancellations and early outbreaks. The graph measures revenue over time.

While the virus first emerged in Wuhan, its effects on the short-term rental industry are best seen in highly-travelled coastal strongholds throughout Asia: Shanghai, Beijing, Seoul, and Tokyo. After the onset of Covid-19, future demand throughout the region has retracted.

Western cities currently facing the same potential for impact include Seattle, Austin, Barcelona, Milan, Rome, and New York.

Looking forward to the beginning of May, most destinations are averaging about half the bookings that were made back during the preliminary impact period in mid-February.

 

Written by Karibu Qwetu • March 14, 2020
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