It’s that time of the month again, when we share the latest industry news from the past few weeks.
But rather than look specifically at vacation rental news from December, this time we’ve decided to review important updates spanning the entire year. After all, the closing of the year is the perfect time to reflect on how far the industry has come in recent months—and where it’s poised to go.
Summary:
- Airbnb had a strong year, seeing record Q2 and Q3 profits.
- New rental offerings appeared to meet guests’ demand for unique stays.
- Tech solutions focused on preventing unauthorized parties and maximizing earnings.
- ChatGPT and AI found numerous applications in vacation rental management.
- Government regulations aimed to offset housing shortages and increase fairness and transparency.
- Industry players stepped up to help with multiple humanitarian causes.
- Lodgify celebrated its 10th anniversary as a business.
A strong year for Airbnb
2023 was a particularly strong year for Airbnb. Coming out of its first profitable full year in 2022, the company went on to see its most profitable second quarter and third quarter ever!
They also reached one million Superhosts on their platform and announced helpful new updates and features throughout the year, including:
- User updates such as the ability to check (and correct) your listing categories and a new Guides Board for the Community Center
- A Summer Release with 25 enhancements to simplify hosting, including the “Rooms” category to promote private rooms and the “Host Passport” to offer essential information about hosts
- Verified listings to ensure host authenticity and boost guest confidence (set to launch in February)
- A Winter Release with new features such as a “Listings” tab where you can easily edit listing details and create an arrivals guide, an AI-guided photo tour, a smart lock integration, an “Earnings dashboard,” and a “Guest Favorite” badge
Stays as unique as the guests who book them
At the beginning of the year, Expedia Group’s 2023 Travel Trends Report predicted that travelers would continue to seek unique stays this year. Since then, multiple industry players have risen to meet this demand.
For example, Sports Illustrated (yes, you read that right) teamed up with Travel + Leisure Co. in September to launch Sports Illustrated Resorts. These immersive sports-themed resorts and experiences are to be located near universities with passionate sports communities, with the first planned to open in late 2025.
That same month, World of Hyatt announced its new offering Homes & Hideaways, a unique choice of short-term private home rentals that go “beyond the traditional hotel stay” and are designed to provide “more flexible stay experiences to suit the travel needs of every guest.” Options range from mountainside ski chalets to beachfront escapes and expansive villas.
Similarly, just this month Homes & Villas by Marriott Bonvoy relaunched its Curated Collections. Accommodations include everything from ski-in, ski-out chalets to the more eclectic, “once-in-a-lifetime stays” such as jungle domes, old log mills, and Australian pole houses.
And did we mention that superyacht brokerage TJB Super Yachts announced a private rental consultancy to plan bespoke, one-of-a-kind stays? Think safari retreats, private islands, and hidden sanctuaries.
What does this mean going into 2024?
Predictions show that demand for unique experiences isn’t going away in 2024. For example, Condé Nast Traveller included eco diving and urban gardens as well as frontier, astro, and sports tourism on its list of 2024 trends.
Keeping in mind that many of the new offerings from 2023 are geared toward higher-end travelers, and also that Airbnb still isn’t accepting new Experiences submissions, this might be a good time to start offering unique stays through your direct booking website.
Technology rose to the occasion
Unsurprisingly, we also saw new technology offerings rise to meet hosts’ and property managers’ needs in 2023.
And this year, those needs seemed to focus on preventing unauthorized parties and maximizing earnings.
Minut kicked off the mission to prevent unauthorized parties with the world’s first-ever outdoor and indoor sensor designed for hosts and hospitality. This sensor monitors noise in vacation rentals and provides insights to hosts so they can intervene before damage or neighbor complaints occur.
Vrbo took a different approach to the same problem with new tech that provides a “risk score” for each booking. If factors such as guest number, length of stay, booking timing, or relevant amenities indicate a potential unauthorized party, Vrbo sends an email to the host with an option to cancel without penalization.
As for maximizing earnings, we saw new offerings from both PriceLabs and Beyond.
PriceLabs came out with a new pacing reports feature that analyzes local markets and compares year-over-year performance to help you optimize your pricing strategy and stay ahead of the competition.
Beyond, on the other hand, released a Market Insights tool with details on market dynamics such as ideal booking platforms and amenities as well as metrics such as average length of stay, booking windows, and revenue per night.
AI took the world (and the STR industry) by storm
And speaking of technology, artificial intelligence—and ChatGPT, specifically—made waves in 2023.
We first reported on ChatGPT in January after a property manager used the tool to create a Zillow listing in less than five seconds. There’s no doubt that many more property managers followed suit, and Expedia even turned to ChatGPT to help with in-app travel planning in April.
In May, Canadian design platform Fülhaus unveiled an AI-powered service that can help you furnish your short-term rental with the upload of a single image. And the AI-based real estate firm reAlpha Tech Corp. came out with proprietary tech to identify and acquire properties suited for short-term rentals in October.
Even Airbnb demonstrated its commitment to developing AI applications with its November acquisition of AI stealth startup GamePlanner.AI.
And on our side, we launched our AI Assistant, a GPT-powered messaging tool designed to streamline guest communications, this September.
Housing shortages prompted STR restrictions
Restrictions and regulations aren’t anything new to the short-term rental industry, and 2023 introduced new updates to the years-long saga.
Most regulations stem from complaints that short-term rentals increase rent prices and drive affordable housing shortages.
The most famous example of this comes from New York City, which started enforcing much stricter restrictions on Airbnbs in September and removed thousands of listings that didn’t comply.
We saw similar measures pass in Portugal, where they banned new licenses for STRs in February, as well as Australia, where a town in New South Wales capped short-term rentals at 60 days in September.
Other cities are taking different approaches. For example, Phoenix introduced a new $250 fee for STR permits and renewals in July to cover administrative costs associated with managing the industry.
And some cities are rejecting such regulations altogether. Homeowners in Summit County, Colorado, for instance, filed a lawsuit in the U.S. District Court to overturn regulations passed in 2021 and 2022.
New measures to promote transparency and fairness
Thankfully, not all regulations passed in 2023 negatively impacted short-term rentals.
For example, the EU Council reached an agreement in March to standardize registration requirements for vacation rental properties across the European Union, creating a level playing field and increasing transparency.
Vrbo also introduced stringent measures to penalize U.S. hosts who cancel reservations in September. And industry leaders banded together to launch a “Coalition for Trusted Reviews” in October, aiming to protect consumers from fake reviews and enable informed purchasing decisions.
There were also multiple measures to promote fee transparency in the U.S., both at the state and national levels.
California Senate Bill 537 was introduced in September and is now in recess. And the Federal Trade Commission (FTC) proposed a new “Trade Regulation Rule on Unfair or Deceptive Fees” in November and is accepting public comment through January 8th.
While the specifics of each rule differ, their main aim is to protect guests by preventing fees from being hidden or misrepresented.
The STR industry stepped up
The everyday challenges and fast pace of the vacation rental industry can feel all-consuming, leaving little time (or headspace) for anything else.
But we were pleased to see the vacation rental industry step up to help with multiple humanitarian causes this year.
Airbnb signed ECPAT’s “The Code” in January to help combat child exploitation and trafficking and committed to various measures to identify and report cases. And as the “Official Hosting Provider” of the Special Olympics, the company helped fans find accommodations in Berlin and donated to the movement.
In sustainability news, Barcelona-based company Sustonica launched its “Committed” program in January to recognize and award eco-conscious rentals around the world. And Rent Responsibly released a groundbreaking sustainability report filled with traveler trends and tips on going green.
We even saw the industry help provide housing to those displaced by the February earthquake in Turkey and Syria and the August wildfires in Hawaii:
- Airbnb.org (Airbnb’s nonprofit organization) teamed up with local officials to offer free temporary housing to survivors and relief workers and matched up to $5 million in donations.
- Booking Holdings (which manages Booking.com and Kayak) donated €250,000 to the UN Refugee Agency and committed to matching Booking employee donations.
- Honolulu Mayor Rick Blangiardi paused minimum stay ordinances for vacation rentals to open up housing and encouraged property owners to offer free or discounted temporary accommodations.
- Airbnb.org teamed up with Hawaii Governor Josh Green to provide free temporary stays for at least 1,000 people uprooted by the wildfires.
- Maui County Mayor Richard Bissen proposed a new bill (still under review) that would incentivize short-term rental owners to offer their units as temporary housing for displaced local residents.
Lodgify turned 10!
We’d be remiss if we didn’t mention our own biggest news from 2023: our 10th anniversary!
That’s right, 2023 marked a decade of empowering hosts and property managers to grow their business.
And what a year we had.
We strengthened our management team, grew our global team to 300 employees, and improved our features and integrations. Leading OTAs and prestigious software recommendation sites recognized us. And we attended the most important vacation rental conferences around the world.
We can’t wait to see what the next year (and decade) has in store!
See you next year!
Clearly, 2023 has been anything but quiet for the vacation rental industry.
Responding to new regulations, travelers’ unique demands, and humanitarian causes has certainly kept hosts and property managers on their toes. Thankfully, we’ve also seen new solutions and strong industry trends to make navigating these changes that much easier.
Whatever 2024 has in store, know that Lodgify will be here to empower you with the tools and information you need to run and grow your business.
And for those of you who haven’t tried Lodgify yet, sign up for our free trial below! Or book a demo call with one of our agents to get a run-through of our product here.
