SoWal Vacation Rental Industry Is Dynamic
December 9, 2011 by Amy Wise-Coble
Today’s vacation rental market isn’t what it was even a few short years ago. The days of large companies dominating and operating under a traditional model are over, and now we have many companies of different sizes with many different models.
And while this phenomenon might seem to defy logic considering the economic downturn, topped off by the effects on the market by the Deep Water Horizon Oil Spill, it actually doesn’t. The very climate created by these factors is exactly what created the perfect storm for the larger, more established companies and fueled so many smaller operators and individual owners into the market.
Everyone is looking for a way to garner a greater return on their vacation rental property…and the overhead it takes to be an established operator with on-site professional services, sales and marketing, and a physical location was making it harder for them to compete.
Also, the popular website VRBO makes it possible for individuals who had very little exposure with the business to market the property quite effectively. So over the course of five years, the pendulum swung from one extreme to the other…with the established operators who had been, in most cases, the only option for homeowners, now becoming the underdog in the fight for rental inventory.
But additional change could be on the horizon as many industry professionals are predicting a swing back to the center. We aren’t there yet, as we are coming off of a summer where we experienced unprecedented demand. The South Walton Tourist Development Council reported a 25% increase in June, a 53% increase in July, and a whopping 64% increase in August for bed tax collections. So, let’s be frank…it would have been really hard to not produce big numbers for your stakeholders in that kind of year.
The crux of the matter becomes whether or not we can hold this kind of demand into the future. And if VRBO and the like, can continue to stand as independent booking platforms for those using them as their sole source for sales.
But in the short term these two considerations should prove to make the coming years successful and dynamic for an industry that provides the foundation for SoWal's tourism industry and thus a power house in our local economy. We’ll be following along…. so stay tuned.