Shorts Term Rentals: No Work, All Play

In Tuesday’s New York Times, reporter Michelle Higgins wrote about “Taking the Work Out of Short Term Rentals” – a topic clearly very relevant to us at VacationFutures.

The article, which centers discussion on rentals through sites like Airbnb, HomeAway and VRBO, notes, “a fledgling industry has sprung up in the last five years offering to take the work out of short-term rentals.” In her writing, Higgins mentions many new players in the rental home management space – likely spurred by Airbnb – including Guesty, Flatbook, onefinestay and proprly. 

Higgins is absolutely correct in her general point – after all, HomeAway reports that owners spend 8.4 hours per week marketing and managing their vacation property rentals. The process can be cumbersome and property owners certainly welcome the assistance.

However, while many new and innovative companies exist in the rental management space on the heels of tech hotshot Airbnb, the rental management industry is actually quite old.  The New York Times’ story leaves out some notable players including VC-backed Pillow, Vacasa (an Inc. 2014 top 10 company and Oregon’s fastest growing company) and Invited Home (a Boulder Techstars company), not to mention the more than 10,000 fragmented vacation rental mangers, many of whom have years if not decades of experience.

In addition to the new companies to which Higgins points, even more innovation exists surrounding the home rental ecosystem. Such growth shows how the home rental aspect of the sharing economy is bolstering the economy overall.  Specifically, we have seen growth, consolidation and globalization in two large areas including property management software and distribution channels.

The bottom line is that the home rental space was less that $40B in size in 1999 and is projected to be $175B by 2016.  With the industry growing so quickly, we should expect constant innovation that brings increased attention to a previously quieter, though old, space.