March 2020 will go down in history as the month that we collectively held our breath. We were completely unsure of what was to come. Now, nearly five full months into living in the midst of a global pandemic, we still actually have no idea what’s to come, but we have the benefit of five months of gathering data, and that gives us hope.
The short term rental market in our hometown, Durham, NC, definitely lived this story. In March we saw a record low occupancy rate (58%) as most hosts experienced cancelation after cancelation. For a few uncertain weeks, no one knew when travelers would start roaming about the country again in need of lodging. Durham is quite friendly toward short term rentals, and we have a lot of people who depend on that income for their livelihoods. Luckily, it didn’t take long for the market to start bouncing back. Looking at data reported by AirDNA, the gold standard for keeping tabs on the short term rental industry, June 2020 saw an average occupancy rate (number of booked days divided by the number of units available) jump back up to 79%, which is right on par with June 2019’s 78% occupancy rate.
If you’re paying attention, it’s undeniable that staying home is still the safest option, as coronavirus cases continue to climb nation and world-wide. But the data indicates people are indeed traveling, so we started asking around to see what the hosts were seeing. Our Durham hosts benefit from being within easy driving distance of many other major cities. The most popular points of origin for its short term rentals are New York, Raleigh, Charlotte, Washington and Altanta, and according to AirDNA data, that’s pretty much the same as pre-pandemic.
Nationally, we can see that domestic tourist destinations are in a better spot than those catering to international travelers. Guests resuming travel are seeking nearby, drivable destinations. According to AirDNA, urban destinations that cater to primarily domestic travelers have averaged a rebound rate of 92% between March and June, much higher than those that rely on international guests, which averaged just 57%. This discrepancy is even more pronounced in resort destinations with a primarily domestic clientele who have seen a 322% increase in bookings since the depth of the downturn, over those that rely on international travelers, which have seen a more moderate 122% increase in bookings.
As we interviewed hosts across Durham, we heard that after a few weeks of nothing but crickets, things did indeed pick up and the guest profiles were varying greatly based on the exact location and amenities offered. One host with a home that has an ideal roommate set up and a location close to the University booked a few international Duke students who had to leave the dorms but couldn’t return home. This turned into a long-term rental and she hasn’t had any turn-over since the pandemic started, relieving her of the extra cleaning duties required by AirBnB during this health crisis, and ensuring she can keep her bills paid. She’s not the only one, many hosts reported seeing a shift to longer stays, multiple weeks, months even, compared to before the pandemic. Those hosts report that many longer term guests are taking advantage of open booking calendars in short term rentals because of pandemic cancellations — they would have normally stayed in long term hotel situations instead. It’s an interesting supply/demand shift – once the availability changed, so did demand.
Other hosts experienced longer dry spells, with no rentals from mid-March through the end of May, but for most things started to pick up by early June as folks who would have normally stayed in a hotel switched to short term rentals in an effort to avoid the communal areas that come with hotel stays, like lobbies, elevators, and shared HVAC systems.
Yet another host credits her private pool for the uptick in bookings since May, and she’s seeing both travelers from across the country, as well as across town, as parents get the bright idea to do a little local “vacation” to a spot where their children can enjoy a few days of swimming without the concern of public pools or beaches.
Speaking of that private pool, The Sidekick seemed like a perfect unit to feature here. We fell in love with Jane’s style when we first stumbled upon her Instagram account. She and her husband put so much thought and care into renovating the dilapidated shed in the backyard of their Durham home into an accessory dwelling unit (ADU) in their backyard, adjacent to their new pool!
Jane is brand new to Airbnb as of earlier this year – she had just opened for business when all of her bookings were cancelled. But come May, as temperatures rose along with the severity of cabin fever, people discovered the little oasis she and her husband had built. Jane has taken the Airbnb Enhanced Cleaning Protocol pledge and is very dedicated to providing a well-sanitized home away from home. She says it’s really not that much different than what she was doing before, just a little more laundry with each turnover. Jane has been working on a new Guest Information booklet, updated with local establishments’ protocols around COVID-19 (i.e. curbside pickup/delivery, mask requirements, etc) so that her guests can continue to enjoy everything that’s still amazing about Durham, safely, with The Sidekick as homebase.
Another short term rental that is worthy of note here, is Kristin’s unit in Trinity Park.
Also an ADU, this apartment above a garage has been on AirBnB for 2 years and has historically seen a very high occupancy rate and stellar guest reviews. Located within walking distance to Duke’s east campus, Kristin’s unit is very appealing for all types of university related travelers. She was pretty stunned when her bookings went dry in March, and compared to other folks we spoke with, she has seen a slower recovery rate. She was grateful to have a local family book the unit for almost two full months in June/July to use as an auxiliary office for two newly-working-from-home parents to be able to get away from their home to work, but still be in a safe, nearby location. She’s starting to see bookings come back in through the fall, but slowly. This is the perfect example of a short term rental in Durham that is perfect for travelers weary of the hotel setting but still looking to enjoy the city or stay near family who live here. Kristin has also taken the Enhanced Cleaning Protocol pledge on AirBnB and is more than happy to provide a very well-disinfected unit for her guests. She is implementing a longer buffer between guests, as well, which gives her time to let the unit sit before she goes in to clean, creating a safer environment for both her and her guests.
Our experience here in Durham is similar to the national trends. Despite a few weeks of hardship in March, we are finding that the short term rental market is strong! People are still traveling, and short term rentals seem to be just as popular, if not more so, than they were before. What are you seeing at your property? Be sure and comment below and let us know how you are doing.