Why more travellers are choosing short-term rentals over hotels in 2020

The travel and accommodation sector across Australia has experienced unprecedented change in 2020.
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Why more travellers are choosing short-term rentals over hotels in 2020

The travel and accommodation sector across Australia has experienced unprecedented change in 2020.

Starting with the devastating summer bushfire season at the beginning of the year, to the Coronavirus pandemic from March and subsequent domestic travel recovery as most Australian states emerge from localised lockdowns.

Covid-19 has accelerated many societal trends already occurring in retail, technology and the workplace from online shopping to working from home. In the accommodation sector, the pandemic has accelerated the travel market's preference for booking entire property short-term rentals for accommodation over traditional hotels.

 

Average occupancy rates for hotels compared to MadeComfy short-term rentals in Sydney (2020)

airbnb occupancy vs hotel 2020-1

*Sydney hotel occupancy rate data via STR.com research. MadeComfy occupancy consists of short-term rentals across the Sydney metro and Blue Mountains region.

 

In Sydney for example, short-term rental occupancy rates of properties managed by MadeComfy have significantly outperformed hotels from March this year.

According to bi-monthly data from research group STR, both Sydney hotel and MadeComfy short-term rental occupancy rates averaged around 77% in January. While both accommodation types declined significantly throughout March to May, MadeComfy's short-term rental occupancy rate remained significantly elevated above the city's average for hotel occupancy, despite the use of hotels for mandatory international arrival quarantine.

This trend has continued into the recovery phase as much of Sydney's lockdown restrictions ended by July. While Sydney hotels posted an occupancy rate of only 33% in July, short-term rentals experienced a much stronger recovery with occupancy of 64%, which is likely to continue rising as the city enters the busier Spring and Summer accommodation seasons.

Key areas of high demand such as Manly and the Northern Beaches, the Eastern Suburbs and harbourside suburbs maintained occupancy rates above pre-Covid levels, averaging 75% - 85%. 

 

Increasing preference for space and privacy

living room short-term rentalImage: Spacious one bedroom apartment with ocean views and balcony in Surfers Paradise

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One of the key drivers for short-term rentals over traditional hotels has been the desire for greater space and privacy afforded by renting an entire apartment or house, over a hotel room.

A typical hotel room will generally only consist of a studio room with bed and bathroom, while short-term rental properties are generally fully furnished and self-contained properties that have separated living and bedroom spaces as well as a kitchen. 

Guests that book short-term rentals can avoid busy hotel lobbies and hallways, and instead enjoy the privacy of a home that is located in a residential street or building.

 

Special property features and amenities

washing machine short-term rental-1Image: Two-bedroom apartment in Millers Point

book buttonIn addition to increased space and the inclusion of a full kitchen, short-term rental properties can offer more diverse property amenities than standard hotel rooms. 

 

airbnb balcony gold coast

Image: Light-filled one bedroom apartment in Broadbeach with generous balcony

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Common examples of special property amenities include:

  • Private outdoor areas such as a balcony, courtyard or backyard

  • Private laundry facilities such as a washer and dryer

  • Secure on-site parking

Space to work away from the office

work from homeImage: Luxury Barangaroo apartment

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Short-term rentals offer greater space to work and set up a home office compared to a hotel room which often have inadequate desk or table surfaces to enable productivity for extended periods of time. At MadeComfy, our properties have included wifi, and unlike a hotel you are not sharing a single network among a large number of guests.

 

Self contained amenities for extended stays

katoomba airbnbImage: Fully equipped two-bedroom apartment in Katoomba

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The average number of booked nights per reservation has noticeably increased throughout 2020 as guests seek longer stays in self-contained accommodation.

Average nights per booking for MadeComfy properties increased over 40% year on year in the April-June 2019 quarter compared to the April-June 2020.

Hotel rooms are particularly unsuited for longer stays more than a few days as they do not have any kitchen facilities, requiring guests to eat out everyday or purchase takeaway food to eat in their room (often on top of the bed).

Short-term rentals on the other hand are better equipped with a full kitchen and basic cooking and dining amenities such as pots, pans and plates that are ready to use.

 

Diverse accommodation locations and types

frenchs forest-1

Image: Bright And Spacious Family Home in Frenchs Forest

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Short-term rentals are often more conveniently located properties in a greater variety of areas outside of traditional centres where hotel accommodation are typically clustered.

These can include residential areas outside of the CBD but near other popular destinations requiring short-term accommodation such as universities, hospitals, tourist attractions and regional locations for guests seeking a local getaway. 

Short-term rental guests also have much greater choice of accommodation types to suit individual needs, from one-bedroom apartments for solo travellers and couples, to family homes with multiple bathrooms for larger groups.

 

Importance of stringent cleaning standards

Cleaning-shower-glass_2-1

As the majority of short-term rentals, such as those found on platforms like Airbnb are run by individual hosts, the industry has in the past not been able to offer the same level of standardised cleaning and management of hotels.

However short-term management companies have been stepping in to provide a higher level professionalisation to hosting, by using professional cleaning staff and implementing more stringent standards for property management. Guests can now experience the best parts of booking an entire property but still enjoy the level of hospitality from a hotel.

All MadeComfy properties are cleaned and quality checked against a stringent checklist of standards, as well as enhanced hygiene precautions during Covid-19.

With many short-term rentals employing the same level of cleaning standards as hotels, it has become harder for hotels to employ this as a differentiating factor for guests, particularly those booking from a professional short-term rental company.

 

Ask an Airbnb expert: want more information about short-term rental in Australia? Submit your question to the MadeComfy team below.

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