Reviews rule the roost in short-term rental sector

Following a dip – during the pandemic, and in the initial post-pandemic phase – the short term rental markets are stirring back to cautious growth, globally. And it’s easy to see why. Although many countries are beginning to open their border to travelers from selected nations, the threat of the getting infected by some variant of the Covid-19 virus persists. The overarching concern of most people, who are traveling to overseas destinations, is to ensure that they do not expose themselves to potential infection. In this scenario, short-term rentals are a much more attractive option than hotels and other hospitality establishments – which experience a far greater footfall.

A recent report(1) found very specific trends in US short-term rental markets, depending on location. The survey reported bookings were up 67% in 2021, compared to 2019, in smaller cities and rural areas; the demand in resorts was up 25%; and 8% higher in mid-sized cities. But it was also 13% lower in suburban markets; and a whopping 41% lower in the 50 most populated U.S. cities. Clearly, while there is room for growth, renters are cautious about choosing locations; and even particular properties. This is where the impact of reviews is peaking; driving customers to the properties that are being seen as taking utmost precautions, to ensure their guest’s safety.

The power of recommendation

Reviews have been a strong influence, particularly in various retail and services markets, for some time already. So, with stakes as high as finding the right short-term rental is the current scenario; the influence of reviews is proving to be gamechanging, for the properties that get things right.

29% of short-term rental users in the United States depended on review scores, to differentiate between similar properties; according to a recent survey(2). The number was even higher for those travelers who depended on others within their demographic. For instance, 40% of travelers who were remote workers, favoured properties given good reviews by other remote working travelers. Hosts, who have realized the power of positive reviews to drive returns on their short-term rental properties, are proactively chasing good ratings; and even creating strategies to ensure that they can maximize their profile by manipulating algorithms used by Online Travel Agencies (OTAs), to appeal to a higher number of customers. The key is to register a high enough score, over a high enough number of reviews, to gain online credibility. In addition, these numbers dictate how prominently a property is listed on an OTA platform; making it even more critical to accumulate good reviews consistently.

An Expo fueled recovery, in Dubai short-term rentals

With the proportion of the world’s vaccinated population continually rising; and economic activity beginning to register numbers somewhat akin to pre-pandemic levels; we can finally begin to justify the use of the word ‘normal’, in the term ‘new normal’. Dubai, with its high vaccination rates, resumption of in-person learning and physical workplaces, and widely acknowledged reputation as a ‘safe’ destination; has positioned itself well, to make the most of the growth that the rescheduled Expo promises to unleash.

With record high numbers of foreign visitors expected, for the entire duration of the Expo; short term rental markets are expected to get a much needed shot in the arm. Fortunately, the pre-pandemic short-term rental market in the UAE had already begun to take a firm foothold, as a hospitality segment. With well-established and clearly defined protocols laying the groundwork for best practices; the segment looks set to thrive again. Online reviews will become increasingly important for those managing short-term rentals, as the influx of visitors begins to gather steam. The secret will be to consistently exceed expectations, encouraging guests to go the extra-mile, by posting a positive recommendation in their review.   

  1. https://airdna-website-reports.s3.amazonaws.com/industry-reports/AirDNA-Outlook-Report.pdf?utm_referrer=https%3A%2F%2Fwww.airdna.co%2F
  2. https://www.phocuswright.com/Special-Projects/2021/US-Short-Term-Rentals

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