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Short-Term Rentals a Key Factor in Sluggish Hotel Rate Growth

Dennis Schaal photo
Dennis Schaal

Photo Credit: An Airbnb Plus property in Nashville, Tennessee. A CBRE study says short-term rentals are a contributing factor in hamstringing hotels' ability to raise rates during peak periods. Airbnb

Skift Take

U.S. hoteliers are finding their pricing options constrained because of an influx of both short-term rental supply during peak periods, and because of hotel construction. Hoteliers may decide to get into the short-term rental market or not, but they increasingly have to take it into account when fine-tuning pricing strategies.

Many hoteliers for the last several years have minimized the impact of short-term rentals on their bottom lines in what could be seen as an Airbnb defense. But a new report suggests that alternative accommodations, as well as growth in hotel supply, curb U.S. hoteliers' options to hike average daily rates during peak periods. "In most markets with high short-term rental supply growth, average daily rate increases have been below inflationary levels and/or recent historical trends," according to CBRE Research's Short-Term Rentals: A Maturing U.S. Market & Its Impact on Traditional Hotels. Because of the nature of short-term rentals, which can flood a market during major events or peak seasons and then vanish from the market thereafter,

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