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I have a coastal property that thrived on summer rentals via Airbnb. I was thrilled with how things were going until the town began to consider and is in the process of revising its ordinances to deter short-term rentals. Many cities are similarly enacting deterrences.
If you’re looking to jump into the market, do due diligence on your location’s attitudes toward the STR market.
Subject Expert
Most markets that used to be “great” markets for vacation rentals are highly over saturated, and even the houses that were top 1% are seeing significant declines in revenue.
Vacation rentals probably aren’t in decline overall, but the ceiling for any individual property has gotten a lot lower over the last year or two. While more people might be using the app, there’s way more competition than ever before, and even Airbnb is diverting those users to try and look at “experiences”, not at your property. Plus there’s been a huge uptick in legislation to restrict or outright ban vacation rentals in many markets. If your market hasn’t already seen restrictions, I’d be worried that it’s only a matter of time. A restricted market is probably better for you since it lowers the number of available rentals (a lot of operators won’t want to jump through the hoops) and also sets boundaries for how you operate moving forward. As long as you are fine operating in those boundaries, I think it lessens the likelihood of increased restriction moving forward.
It depends on the market
Agree with others that it’s market dependent. I am also in a coastal vacation rental market and haven’t seen a decline in revenue, but I was fortunate enough to buy pre-Covid and during Covid. Because it’s a traditional vacation area I haven’t seen many local regulation changes.
I think people still use Airbnb/VRBO but making a profit can be challenging with prices of homes these days.
I ave my property on vrbo. VRBO is still growing, though more slowly than Airbnb. It’s particularly strong for family and group travel, and its revenue increased by over 15% last year...
It’s under assault. I tried to buy properties in two suburbs. One banned AirBnBs and the other restricted usage. These aren’t well-known destinations, either