Although the global travel industry has taken a nosedive in 2020 as a direct result of Covid-19, not all elements of the sector have suffered. For some companies operating in the domestic holiday short-let market and for those owners with properties in traditional leisure and rural locations, this year has seen record booking levels, elongated seasons and sold-out inventories.
Consumers have shown a great appetite for travel and ‘getting away’ despite the pandemic. When international travel is mostly off the cards and guests want socially distanced, safe travel options - then private, individual homes (over hotels or resorts) are the obvious answer.
As we move into 2021, this trend will only grow as even with vaccines, international travel is a long way off returning to its previous levels. When it does come back, it's likely that even in cities, the shift towards private, more spacious accommodation will continue.
This is good news for property investors in leisure markets and better news for those in larger urban areas.
So, what trends can we expect to see in short lets in 2021?
Increase in domestic travel and ‘staycations’
More and more consumers are embracing the idea of a ‘staycation’ and travelling closer to home. Of course this has to a large extent been circumstantial, however it’s a trend that will increase even as borders begin to open up and quarantine is no longer necessary.
The UK has a plethora of spectacular destinations and the public has embraced this in 2020. Lockdowns and localised tier restrictions aside - more and more consumers will be looking for short, last-minute breaks in attractive locations close to home.
Work, rest and play - anywhere
As we have experienced, one of the fallouts of Covid-19 has been the work-from-home mandates. Many offices have been forced to shut or at least reduce the capacity they offer workers. This has led to a sea change in how we live and work.
The concept of being a ‘digital nomad’ and working remotely whilst living in a new or different location is no longer a far away dream. These workers will, of course, need accommodation when they travel and short-lets are ideal for this.
Focus on safety and quality assurance
Another fallout of the pandemic has been a razor sharp focus on the standards of cleanliness, safety and quality assurance of rental properties. As it should be.
According to Breezeway, a property operations and services platform operating in the space, a short-let property is taking an average of 25 minutes longer to clean since the pandemic. Moving forwards, extra emphasis will be demanded by guests on the quality and safety standards of the properties they rent and increased resources will need to be allocated. This is a good thing as it will set those who manage professionally apart from those who don’t.
Increased adoption of technology
2020 has been the year of technology acceleration. All areas of our lives are now influenced by technology in ways that they may not have been before March 2020. According to recent data published by McKinsey, we have vaulted five years forward in consumer and business digital adoption in a matter of around eight weeks.
For short lets, we’ve seen an uplift in the use of technology that supports frictionless stays with keyless entry and occupancy monitoring (check out Operto) and technology that eases property care and operations such as digital team scheduling, quality control software and cleaning protocols. Focusing on operational technology will only set to increase in 2021.
‘Hotel Like’ short-let boom
In 2019, the ‘masterlease’ model was the business model ‘du jour’ of short lets. Well-funded start-ups such as Lyric and Sonder stole headlines and got big funding rounds for the concept of taking over the rents of large institutional buildings in cities and turning them into branded ‘hotel-like’ apartments for short lets.
This looked to be a very successful model until the companies got stuck with the leases and no guests. Today - new business models are emerging whereby property managers and technology companies are working with large asset owners and turning them (or parts of the buildings) into branded, tech-enabled, comfortable lodging options for the short-let and travel market. Companies such as GuestReady, Jetstream and Jurny are leading here.
2020 has been a year unlike any we have seen before, with the short-let market changing and transforming along with the rest of the world. For investors, it’s not an easy market to penetrate successfully, but with the right partners and insight it can be a lucrative and resilient corner to operate in.
*Jessica Gillingham is the director of Abode PR, a member of the Chartered Institute of Public Relations, a non-executive director of Visit Bath and the founder of industry resource PillowTalk Media.