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The Short-Stay Industry Is Starting To Bloom Again

Investing in the short-term rental market? It’s been a bumpy few years with Covid-19, but the industry is now booming, writes Eric Hammond.

By: Eric Hammond

28 February 2023

Without question, a central issue impacting the global short-term rental market over the last several years has been border closures and Covid-19 restrictions. However, 2022 saw a notable return in demand with the end of Kiwi lockdowns and global border re-openings.

At The Stay Hub we achieved an impressive 86 per cent occupancy across our entire portfolio last year. Many of our owners also saw their revenue double in the second half of the year, with this trend set to continue. In 2021, the global short-term rental market held a value of $US99.38 billion. This is forecast to almost triple by 2030, tipping its value over $US256 billion.

INFLUX OF TOURISTS

While most short-term stays in New Zealand for 2022 came from the domestic market and our Australian neighbours, 2023 is set to bring back an influx of tourists. A calendar of headlining events not seen on our shores in the past two years will be key drivers for occupancy and revenue growth. Come July, New Zealand will host the FIFA Women’s World Cup alongside Australia. Tournament CEO Dave Beeche reports between 20,000 and 40,000 Americans will make the trip, with early forecasters expecting a $200 million boost to our economy.

‘Another major comeback is the return of Chinese visitors’

VITAL MILESTONE

Another major comeback in 2023 is the return of Chinese visitors. Pre-Covid, China was our second-largest tourist market, bringing in a spend of $1.7 billion for the financial year. China officially resumed outbound travel to international countries in January, ending one of the world’s toughest border control regimes. The chief executive of Tourism New Zealand marks China’s return to New Zealand as a vital milestone in our recovery from the impacts of Covid-19.

With further upsides in international student numbers, migrant visa holders, and airline capacity still to come, there is plenty more growth to look forward to in the industry. Recent data from Statistics New Zealand shows a resurgence in migrant arrivals since August 2022. Kiwibank economists have predicted a net migration of over 30,000 people this year.

MAKE THE SWITCH

One thing is clear, with three years of pent-up demand, there has never been a better time to join the short-term rental market. If you are new to the scene or simply want to increase your rental returns, consider joining a professional property management company.

While Airbnb is favoured domestically, professionals can maximise property exposure with listings across 140 global platforms such as Expedia, Vrbo, Booking.com and Agoda.

Companies such as The Stay Hub, who are proud partners with “Homes & Villas” by Marriott International, also offer premium and luxury property owners the exciting option to join Marriott International’s expertly curated rental platform. This portfolio reaches more than 157 million Marriott Bonvoy members around the world.

A crucial factor for income growth is also having an experienced, data-driven approach to revenue management. Rather than relying on pricing algorithms, a team of professionals can deliver property earnings from the get-go. For any property owner or investor, short-term rentals are a surefire way to increase your rental returns, if it’s done right.

The Stay Hub is Auckland’s leading short-term property management company. With owner and guest experience at our heart and a technological and data-led approach, we are your one-stop shop, covering everything from extensive global marketing to hands-on revenue management, concentrated guest vetting and plenty more.

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