Throughout the pandemic businesses adjusted to a new way of life with the rise of remote workers and as we return to normality this trend is set to continue driving short-term rental demand.

Airbnb CEO Brian Chesky has stated they “wouldn’t have recovered so quickly from the pandemic had it not been for millions of people working from Airbnbs”. Supply growth for the global travel giant saw them end 2022 with 6.6 million listings. With a revenue of $8.4 billion, Airbnb grew 40 per cent year-over-year for 2022. The growing popularity of “digital nomadism” and working while travelling has fueled new ways of travelling and contributed to a swift market comeback.

Business Travel

For 2023, the Global Business Travel Association has projected a spend of just under $1.2 trillion on global business travel. Polling suggests 78 per cent of travel managers will engage in business travel this year and 91 per cent feel their employees are willing to travel again. Reduced travel expectations are the lowest for Asia Pacific at only 7 per cent and North America at 6 per cent.

Expedia has also reported in their latest research that one in three consumers are planning an upcoming business trip, while one in two are likely to or will travel internationally within the next year.

Work travel trends include “bleisure”, which combines business and tourism, followed by team trips with a focus on bonding and collaboration, and extended stays for business or off-site training, all of which have seen more companies booking short-term rentals. This demand has naturally catapulted workspace rentals to the top of the list for sought-after amenities.

On The Rise

“Co-worker spaces” is a new niche, with freelancers and companies opting to pay month-to-month for temporary office space. While they have the same amenities as a regular office, the core difference is not being locked into a long-term lease, a highly attractive component for project management or frequent business travel.

Companies often utilise these flexible spaces to accommodate projects involving more than one business. Statista has projected close to 42,000 co-working spaces will be available as short-term rentals by 2024, with its global value currently estimated at $26 billion.

Surge In Demand

Another key trend sparking market demand is the desire for cleanliness and minimising Covid-19 exposure. Short-term rentals diminish the risks associated with the virus by reducing unnecessary contact and fostering a safer environment. Throughout pandemic restrictions, droves of travellers moved away from crowded hotels, opting for the intimate environments short-term rentals offer.

According to STR, net interest in short-term rentals grew 12 per cent in 2021, and continued to trend upwards to nearly 20 per cent in 2022. In contrast, interest in hotels dropped by over 50 per cent.

Expedia’s 2023 Traveller Index has shown that while the fears associated with Covid-19 have receded, it is still a core concern. Thirty-five per cent of travellers continue to prioritise minimising exposure and 51 per cent state that cleanliness and safety is their top priority.

The report also indicates over half of respondents believe the experience you gain from travelling outweighs the cost, while 46 per cent say travel is more important to them than it was prior to Covid-19. A desire to make up for lost time during the pandemic and the physical and mental health benefits are two of the top motivators for travel. Auckland has plenty of health-centred experiences, with Marie Claire Australia going as far as dubbing the city the “next big wellness destination”.

Reputation Is King

Another area of interest for short-stays is the value travellers place on reputation. Expedia has reported that 48 per cent of travellers rank guest reviews ahead of recommendations from family or booking platforms, with nearly 50 per cent choosing the service provider with the best reviews over the best value.

If you join a short-term rental company you are set for success from the get-go, with five-star reviews and the likes of an Airbnb Superhost ranking.

If you would like to discuss what your property could earn in the market reach out to The Stay Hub for a free property appraisal.

The Stay Hub offers a full range of Airbnb and short-term rental property management services, covering everything from extensive global marketing to hands-on revenue management, guest vetting, cleaning after each stay, and plenty more. We have a technological and data-led approach, with owner and guest experience at the heart of our operations. Visit www.thestayhub.co.nz.