Airbnb and other short lets performing strongly for investors

Airbnb and other short lets performing strongly for investors


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A tracking study, conducted in partnership with the UK Short Term Accommodation Association, shows exactly how well Airbnb and other short let platforms are performing with the pandemic in retreat.

The study measures the three main accommodation sectors simultaneously comparing how London’s short term rentals, hotels and serviced apartments have performed against each other.

For occupancy, short term rentals were considerably ahead of the others averaging 62.7 per cent for June. Hotels stood at 40.6 per cent and serviced apartments were 39.7 per cent. 

For Revenue per Available Room (RevPAR) short term rentals were ahead again averaging £79.20 in June – a 59.5 per cent year-on-year increase – compared to hotels which averaged £40.40 and serviced apartments which averaged £57.80.

Short term rentals saw an increase in the average length of stay from 10.6 days in May to 11.0 days in June. There is no comparable data with hotels and serviced apartments for this metric.

Merilee Karr, chair of the STAA, says: “It’s great to see that some of the main business indicators for the short-term rentals sector are looking in much better shape now since the UK domestic tourism and hospitality markets opened up. 

“Whilst there has been a noticeable absence of international visitors to London, the news that fully vaccinated individuals from Europe and the US will be welcomed back to England from August 4, should help improve the picture for many operators and drive the recovery for the capital’s accommodation.

“It’s interesting to see that not only is occupancy and RevPAR looking good but the average length of stays has steadily increased since April. 

“Guests are taking fewer but longer trips away because short term rentals can offer them a true ‘home-from-home’ experience enabling people to combine work with time away. As the traditional UK holiday destinations fill up, people should turn to see what their cities can offer. Short term rentals enable guests to socially distance themselves from others and offer them the reassurances of high standards of cleanliness and safety. This should appeal to both leisure and business travellers.”

The study’s key findings:

Occupancy (12 months to end June 2021)

– Short term rentals stood at 62.7% for June 2021, which is a 35.7% year-on-year (y-o-y) uplift on June 2020. Month-on-month (m-o-m), there has been a minor drop of 1.4%.

– Hotel occupancy was 40.6% in June, up 61.8% y-o-y and 32.4% higher than May 2021

– Serviced apartments were 39.7% in June a y-o-y increase of 126.7% and 18.6% better than May 2020

– 

Average daily rates (ADRs) (12 months to end June 2021)

– Short term rentals averaged £126.20 for June which was a rise of 17.5% y-o-y but a 5.3% decrease compared to May

– Hotels averaged £99.40 for June had a 31.6% y-o-y improvement and were up 14.6% on May

– Serviced apartments averaged £145.70 for June which was a 33.6% y-o-y decrease and a 6.6% increase compared to May

Revenue per Available Room (RevPAR) (12 months to end June 2021)

– Short term rentals averaged £79.20 in June and saw the highest growth with a 59.5% y-o-y increase. They were down 6.6% on May

– Hotels averaged £40.40 in June which was a 112.9% y-o-y increase for hotels and a 51.7% rise on May

– Serviced apartments averaged £57.80 saw a y-o-y increase of 50.5% and a monthly rise of 26.4%

Average length of stay

– The average length of stay for short term rentals rose from 10.6 days in May to 11.0 days in June. In June last year the average length of stay in a short term rental was only 9.4 days.

– For the 12 months to June 2020 the average length of stay was 6.9 compared to 11.3 days for the 12 months to June 2021.

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