The Impact of Global & Local Events on Vacation Rental Demand

As a short-term rental property manager, you need to understand the dynamics of vacation rental demand so that you can maximize occupancy rates, optimize pricing, and stay ahead of the competition. While factors like location, amenities, and marketing play a huge role in attracting guests, global and local events can also have a profound impact on demand and profitability.

Below, you’ll learn how global and local events influence vacation rental demand and obtain practical insights to successfully navigate these fluctuations. 

Types of Global Events That Can Influence Demand

As a short-term rental property manager, you have virtually no control or input regarding global events or international conflicts. However, by familiarizing yourself with the various risks on the horizon and their implications on your portfolio, you can mitigate the impacts of some of these events. Here are some of the global events you need to be aware of:

Pandemics

The pandemic outbreaks can lead to travel restrictions, lockdowns, and safety concerns. In turn, you’ll face a huge drop in travel demand and long stretches of vacancies. Depending on the nature and severity of the incident, you may also see an uptick in cancellations and major revenue losses.

It’s important to maintain adequate cash reserves and pay attention to the latest news regarding pandemics. Additionally, you should take steps to make guests feel safe, such as hiring a professional cleaning service that uses high-quality sanitation supplies. That way, you’ll be able to get back to business as soon as travel restrictions are lifted. 

Economic Downturns

Recessions and periods of high inflation may leave vacationers with less money to book stays or travel. Less disposable income can have a huge impact on travel demand, especially if your rental rates are a bit on the higher side. 

Consider offering flexible pricing or discounts to encourage people to book stays at your properties. For instance, you could offer a multi-night discount if someone stays with you for more than three nights. 

Also, keep in mind that consumers may be more hesitant to spend money, which means you should take extra steps to make your properties stand out. 

Natural Disasters

Wildfires, hurricanes, blizzards, and other natural disasters can cause travel concerns and potentially cause severe damage to the properties in your portfolio. While you can’t do much to stop natural disasters, you can make sure your assets are protected with short-term rental insurance from Safely.

Our customizable policies are affordable and tailored to align with your needs. Connect with Safely and obtain a free quote on short-term rental insurance. We look forward to giving you peace of mind. 

Leveraging Local Events to Maximize Occupancy Rates and Revenue

Generally, you’ll have many more options when it comes to local events and how you respond to them. For the most part, local gatherings tend to positively impact your short-term rental occupancy rates, whereas global incidents are skewed toward the negative. 

Here are some of the local and regional developments that you can take advantage of to generate more revenue. 

Seasonal Travel

Seasonal changes are major drivers of vacation rental demand. For instance, properties near popular beaches will experience an uptick in occupancy during the spring and summer months. On the flip side, mountain retreats tend to be especially popular during the winter months, as guests are eager to take in picturesque scenes like snow-capped mountains. 

However, non-peak seasons can lead to a corresponding drop in demand. Your beach rental property probably won’t get the same traction with guests in the height of winter. The good news is that you can offset some of these dips by offering lower rates or other incentives. 

Festivals and Other Municipal Gatherings

It’s important to familiarize yourself with events that happen near your portfolio of properties. Community get-togethers, festivals, and other gatherings can lead to an uptick in demand and help you book up your properties. 

As you explore new investment opportunities, consider properties near event hotspots. However, it’s important not to rely on a single annual event to be your primary demand driver. Instead, you should work to make your properties appealing year-round. 

Major Concerts and Events

Short-term rentals positioned near professional sports stadiums and popular concert halls may draw a steady stream of guests all year long. If you invest in rentals that also happen to be located in tourist hot spots, you’ve got a great chance of maximizing your revenue.

For instance, Nashville has become a pop culture phenomenon, attracting tourists, bachelorettes, families, and concertgoers. This is just one example. You can find similar markets throughout the nation and use their unique geographic positioning to enjoy consistently high demand. 

Business Conferences and Corporate Travel

Corporate events and business conferences represent a few other local events that can suddenly increase demand for your rental properties. Keep up with these event calendars so that you can adjust pricing accordingly and take advantage of increased interest in your property. 

To be clear, you should be careful not to price yourself out of the market. Instead, be flexible and ride the demand wave throughout the year. 

For instance, you may typically offer seasonal discounts during the winter months because you have noticed a predictable dip in demand. However, this year, there is a major corporate conference that is attracting thousands of professionals to the area. In this scenario, you might want to temporarily suspend your usual seasonal price drops and charge normal market rates. 

Adapting to Global and Locally-Driven Demand Changes

Once you’ve purchased a property, you’ll have very little control over external factors that impact demand. However, you can weather the storm created by demand drops and maximize revenue during peak periods by staying apprised of what’s going on in your market. 

Be proactive and diligent. Keep a calendar of recurring events and routinely check for one-off gatherings that could be good (or bad) for your short-term rental business. Knowledge is your best ally as you ride the demand wave to a strong return on investment.