The possibility of rental arbitration remains in American cities
The vacation rental industry was resilient at the start of the pandemic compared to other parts of the travel industry.
Many consumers sought out an environment they felt they could control, and properties in more rural destinations did well.
AirDNA has partnered with real estate analytics specialist RealPage to assess the opportunity represented by rental arbitration – the rental of a property already rented on vacation rental platforms.
In a report, companies say long-term rentals have increased by more than 10% in one-third of U.S. cities in the past year.
Short-term rentals, for their part, despite a 50% drop in 2020, rebounded quickly, with more than 70% occupancy recorded in June 2021.
The study then reveals that there are currently more than 600,000 listings for short-term multi-family rentals on Airbnb or Vrbo, the vast majority of which are in US cities.
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Unsurprisingly, coastal areas such as Boston, Los Angeles, Seattle and New York have seen a significant drop in registrations.
The study attributes this to a number of factors, including regulation, the closure of some short-term rental players, and the economic evolution of short-term rental opportunities.
Short-term rental demand in coastal destinations increased by more than 20% in the second quarter of 2021 compared to 2019.
This has pushed earned income per unit upwards while there have been only small increases in apartment rents, leading to growth in rental arbitrage.
The report goes on to say that in many US submarkets, renters can rent apartments for as little as five nights a month to cover an entire month’s rent.
Scott Shatford, CEO of AirDNA, said: “The rental arbitration model has really taken on a whole new form in 2021. What was once considered ‘home hacking’ has now become a fully streamlined and transparent way. for tenants and landlords to benefit from both flexible living.
He adds that technology like the one provided by RealPage helps tenants list multi-family roommate properties on platforms like Airbnb.
The report highlights cities such as Savannah, Charleston and New Orleans as some of the best for rental arbitrage, while some destinations such as San Diego are new at the top of the list.
The full report can be viewed here.