Market Overview
Global
Short Term Rental Market is forecasted to reach
USD 131.4 billion by the end of 2024 and grow to
USD 341.9 billion in 2033, with a
CAGR of 11.2%.
Short-term rentals are the temporary leasing of a residential property typically ranging from a few days to several weeks. It is often used by travelers, vacationers, or business professionals seeking temporary accommodations. These properties are often listed on platforms like Airbnb or VRBO, allowing owners to rent their spaces for flexible periods. The popularity of short-term rentals has grown due to their convenience, home-like atmosphere, and often lower cost compared to hotels. The short-term rental market is driven by increasing tourism, remote work trends, and demand for personalized experiences.
The US Short-Term Rental Market
The US Short Term Rental Market is projected to reach USD 42.1 billion by the end of 2024 and grow substantially to an expected USD 103.5 billion market by 2033 at an anticipated CAGR of 10.5%.
The growth of the US short-term rental market is driven by the increasing popularity of travel experiences that offer unique accommodations. Travelers are seeking personalized and local experiences, which has boosted demand for short-term rentals over traditional hotels.
There is a growing trend for luxury and eco-friendly properties, as travelers increasingly prioritize sustainability and comfort. Technology-driven solutions, such as automated check-ins, smart home devices, and data-driven pricing strategies, are reshaping how hosts and guests interact.
Key Takeaways
- Market Growth: The global Short Term Rental market is anticipated to expand by USD 197.3 billion, achieving a CAGR of 11.2%.
- Market Definition: Short Term Rental refers to the leasing of a property for a brief period, typically ranging from a few days to several months, but usually under a year.
- Accommodation Analysis: Home segment is predicted to dominate the market with a high revenue share of 47.2% in 2024.
- Booking Mode Analysis: The online platform is predicted to lead the market with a revenue share of 65.3% in 2024.
- Regional Analysis: North America is projected to dominate the global short-term rental market, holding a market share of 38.1% by 2024.
Use Cases
- Vacation Stays: Travelers book short-term rentals, like Airbnb properties, for vacations that offer the comfort of home with amenities like kitchens, private pools, or larger spaces for families, making them an attractive alternative to traditional hotels.
- Business Trips: Business professionals may opt for short-term rentals during work-related travel which provide a more relaxed, home-like environment compared to hotels, often with access to workspaces and Wi-Fi, ideal for long stays or remote work scenarios.
- Temporary Relocation: Individuals or families in transition—such as those relocating for work, undergoing home renovations, or between homes—use short-term rentals as a temporary living solution until they find permanent housing.
- Medical Tourism or Treatment: Patients traveling for medical treatments, procedures, or recovery periods often book short-term rentals close to hospitals or clinics. These rentals offer privacy, comfort, and proximity to medical facilities during the patient's stay.
Market Dynamic
Drivers
The popularity of Corporate Travel, Adventure Travel, and StaycationsThe rise in corporate travel, adventure tourism, and staycations increases demand for distinctive, cozy lodging. Travelers seek unique, local experiences and home-like comfort, which short-term rentals provide. These accommodations offer flexibility and personalization, catering to diverse travel preferences, and driving growth in the short-term rental market.
Homeowners Drawn to Short-Term Rentals for Revenue
Many homeowners are attracted to the short-term rental market for its income potential. Renting properties on platforms like Airbnb allows them to capitalize on the increasing demand from travelers. This trend fuels market expansion, as homeowners see short-term rentals as a lucrative, flexible source of revenue.
Restraints
Regulatory Restrictions
Many cities and municipalities have implemented strict regulations on short-term rentals to address concerns related to housing affordability, neighborhood disruptions, and safety standards. These regulations may include limits on the number of rental days, licensing requirements, or outright bans in certain areas, which restrain the market's growth.
Increased Competition
The short-term rental market is becoming increasingly competitive due to the rise of platforms like Airbnb, Vrbo, and Booking.com, as well as new entrants. This increasing competition can lead to high prices and reduced profitability for hosts and companies operating in the space, especially in popular destinations where supply outpaces demand, which limits the market's growth.
Opportunities
Gen Z and Millennials Favor Internet Booking
Gen Z and millennials increasingly prefer online booking services for convenience and access to distinctive short-term rental experiences, which offers great opportunities for the market. Their preference for unique, local stays over traditional hotels drives demand for short-term rentals, contributing to the market's growth and evolution toward personalized, technology-driven services.
New Entrants and Specialty Platforms
The emergence of new entrants and specialty platforms targeting specific traveler demographics widens the range of short-term rental options. By catering to diverse passenger needs, these platforms encourage market expansion, offering more personalized accommodations and fostering competition, ultimately benefiting travelers and property owners.
Trends
Rise of Extended Stays
As remote work has become more common, many travelers are opting for longer stays in short-term rentals, sometimes for several weeks or months. This shift has expanded the traditional short-term rental model to cater to remote workers, who seek flexible living arrangements in different locations.
Sustainability Focus
Hosts and platforms are increasingly adopting environmentally friendly measures, such as offering energy-efficient appliances, using eco-friendly products, or promoting properties that minimize their environmental footprint. Sustainability certifications and green initiatives are becoming key differentiators for properties looking to attract environmentally aware guests.
Research Scope and Analysis
By Accommodation
Home segment is expected to dominate short-term rentals with an anticipated revenue share of 47.2% by 2024, as its wide array of options, such as houses, villas, flats, and condos cater to various traveler preferences. Homestay accommodation allows visitors to immerse themselves in local culture and lifestyle more fully than hotels can, providing more authentic experiences compared to hotel stays.
Home-based stays also tend to offer personalized, more comfortable stays at lower costs compared to their counterparts in hotels. Home rentals provide visitors with a sense of "living like a local," with amenities like kitchens and private spaces to "feel at home". Home rentals also allow families, long-term travelers, or groups looking for additional space who wish to save costs by cooking meals themselves more often to benefit.
Home rentals have experienced significant growth thanks to online platforms that make listing properties for rent easier for owners while making booking them simpler for travelers worldwide. Resort/condominium segment growth should increase rapidly over the forecast period. Demand for personalized travel experiences, particularly in resort areas and condos, has contributed significantly to this surge. Resorts and condominiums located within popular tourist locations allow easy access to beaches, attractions, and recreational activities - providing convenient travel experiences at their core.
By Booking Mode
It is estimated that online platforms are predicted to dominate the short-term rental market with a 65.3% market revenue share by 2024, offering users access to thousands of rental options worldwide in an instantaneous way. Travelers can search, compare, and book accommodations through user-friendly interfaces at any time online which makes the booking process far more efficient than offline alternatives. These platforms aggregate an abundance of rental listings with houses, villas, and condos available which is ideal for travelers.
At TripAdvisor, travelers can search properties to meet their preferences, budget, and location needs. In addition, users can read and leave reviews that foster trust among fellow travelers, creating transparency among travelers. Reviews provide prospective renters with invaluable guidance when making decisions, enabling them to assess the quality of accommodations based on past guest experiences and also take advantage of cheaper rental accommodation platforms than actual properties themselves.
Travelers have many accommodation options at their disposal depending on price, amenities, and proximity to key attractions - offering maximum flexibility. While online channels such as travel agencies or direct booking with property managers often provide more tailored experiences. Some travelers appreciate speaking directly with knowledgeable agents who provide tailored recommendations as well as handle booking arrangements on their behalf.
Global Short-Term Rental Market Report is segmented based on the following
By Accommodation
- Home
- Resort/Condominium
- Apartments
- Others
By Booking Mode
- Online/Platform-based
- Offline
Regional Analysis
North America is expected to dominate in the global short-term rental market with a revenue
share of 38.1% in 2024. Major short-term rental companies like Airbnb and HomeAway exist here, providing ample competition. North American culture has also welcomed the sharing economy with open arms, leading to widespread acceptance of renting personal properties for short stays and expanding this market.
North America serves as a center of technological innovation which furthered this development. Fast internet services in this region make short-term rental services seamless for guests and hosts, with modern digital platforms and smartphone apps making booking stays and listing properties much simpler for both. Asia-Pacific has experienced the fastest market expansion during this forecast period, outstripping North America in growth rates. South Asian nations have witnessed increased interest in alternatives to traditional hotels due to rapid urbanization and rising disposable incomes.
Europe
- Germany
- The U.K.
- France
- Italy
- Russia
- Spain
- Benelux
- Nordic
- Rest of Europe
Asia-Pacific
- China
- Japan
- South Korea
- India
- ANZ
- ASEAN
- Rest of Asia-Pacific
Latin America
- Brazil
- Mexico
- Argentina
- Colombia
- Rest of Latin America
Middle East & Africa
- Saudi Arabia
- UAE
- South Africa
- Israel
- Egypt
- Rest of MEA
Competitive Landscape
Short-term rental market dynamics are highly fragmented, featuring numerous large and small players operating both domestically and internationally. Established global brands, like Airbnb, Booking.com, Vrbo, and Sonder are major influencers on competition dynamics while regional platforms and property management companies play important roles too.
While currently moderately fragmented as more players enter, market fragmentation could increase with emerging business models catering to changing consumer tastes; major platforms continuously enhance their services with flexible booking options, improved user interfaces, and integrated experiences; all features that improve consumer preferences over time.
Some of the prominent players in the global short-term rental market are
- 9flats.com PTE Ltd.
- Airbnb, Inc.
- Booking Holdings Inc.
- Expedia Group, Inc.
- Hotelplan Management AG
- MakeMyTrip Pvt. Ltd.
- NOVASOL A/S
- Oravel Stays Private Limited
- Tripadvisor, Inc.
- Wyndham Destinations, Inc.
- Others
Recent Development
- In September 2024, Zumper announced a partnership with Airbnb to market Airbnb-friendly rental communities directly on Zumper’s platform. As part of the home-sharing platform’s bit to make hosting more “accessible” to more people, Airbnb is enabling renters to find a place to live and sublet it on Airbnb part-time when they are staying away from home, whether it is a single room or a full apartment.
- In August 2022, Zumper, North America's largest privately owned rental marketplace, launched its short-term rental product which raised revenue to USD 178.0 M to date, the latest Series D funding extension of USD 30.0 M was earmarked for expansion into short-term rentals at a time when consumers demand, if not require, flexibility in housing choices.
- In December 2022, Booking Holdings Inc. paid USD 1.2 billion to acquire Getaroom from Court Square Capital Partners. This acquisition is intended to increase the value of the brand's pipeline.
Frequently Asked Questions
The Global Short Term Rental Market size is estimated to have a value of USD 131.4 billion in 2024 and is expected to reach USD 341.9 billion by the end of 2033.
North America is expected to be the largest market share for the Global Short Term Rental Market with a share of about 38.1% in 2024.
Some of the major key players in the Global Short Term Rental Market are Airbnb, Booking.com, Vrbo, and many others.
The market is growing at a CAGR of 11.2 percent over the forecasted period.
The US Market size is estimated to have a value of USD 42.1 billion in 2024 and is expected to reach USD 103.5 billion by the end of 2033.