Short-Term Rentals a Key Factor in Sluggish Hotel Rate Growth
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, hoteliers have seen their traditional pricing power limited, the report said.