- Airbnb executives told Insider that the top and bottom listings are fully booked this summer.
- It’s the mid-range accommodations with outdated furniture and hosts who are stubbornly price-conscious and can’t find guests.
- Travelers this year are “champagne-flavored on a beer budget,” said a Phoenix executive.
One type of rental is struggling on Airbnb and Vrbo this summer, managers at several properties told Insider.
It’s a step up from the cheapest room in town, but also a step up from a McMansion with a game room and pickleball court.
Maybe the furniture is dated or the amenities are limited — just a pool, but no hot tub — and the host is adamant about the price.
It’s an entry stuck in the so-so midfield and going unbooked in the most competitive summer for hosts in three years.
Host earnings are expected to fall on average this year for the first time since the pandemic, according to short-term analytics site AirDNA. Likewise, average occupancy — how many nights an Airbnb is booked per month — is forecast to fall slightly, from 58% to 56%. Hosts told Insider that, given the trends they’re seeing on their dashboard, the so-so middle will be bearing the brunt of this downturn.
This trend will continue, predicted AirDNA chief economist Jamie Lane.
“As short-term rentals become more mainstream, there will also be higher expectations,” he told Insider.
Airbnb declined to comment.
Luxury real estate does well without trying
Luxury properties continue to remain booked, largely because their clientele is spared the economic uncertainty facing budget-conscious travelers, short-term rental property managers told Insider.
“It’s a completely different clientele. They’re not concerned with a stock market decline or whether we expect a recession,” said Phoenix manager Ric Kenworthy, who oversees 92 properties.
Five of Kenworthy’s offerings fall into this luxury category. They feature infinity pools, bocce ball courts, and pickleball courts, and cost up to $800 a night. Kenworthy said these properties are 80% booked this summer, ahead of the forecast average of 56%.
In Lake Arrowhead, manager Katie Kay Mead, who oversees seven Airbnbs, sees a similar trend.
A five-bedroom luxury lake home that she manages features a game room, hot tub, and gorgeous water views. The rent is currently $600 a night, and Mead said it’s already fully booked for every weekend this summer.
Budget travelers are ‘flavoring champagne on a beer budget’ this summer
Meanwhile, budget-conscious travelers have high expectations given the plethora of offerings to choose from.
“They have champagne tastes on a beer budget,” Kenworthy said.
Hosts said that aesthetics matter when many of the properties have stuck in the so-so midfield.
As guests scroll through listings, they crave something that “jumps off the page,” Kenworthy said. “People want to stay in a place that’s nicer than where they live.”
In Phoenix, it means “crisp black and white modern” or “Spanish hacienda style.” Drab, dated interiors are being overlooked, he added.
In California, Mead said, the accommodations that aren’t booked look like “someone in the family decorated 1978 and it’s all like a time capsule.”
“Broadly speaking, it’s about having higher quality finishes,” Lane said. “You can’t leave the 30-year-old grandma’s furniture, rent it out and then count on good occupancy.”