As summer gives way to fall in the Coachella Valley, vacation rental owners are noticing some interesting trends in their business.
The two key things vacation rental owners are looking at are Adjusted Paid Occupancy and Average Booking Windows (ABW). The observed trends align with the national pattern, with ABW data remaining stable or declining, and occupancy rates gradually decreasing. Read below to learn more!
Understanding the Trends
A closer look at these metrics reveals a changing landscape in the vacation rental industry. ABW in particular holds a pivotal role in understanding booking patterns. This metric tells owners how far in advance guests book their stay and is subject to the ebbs and flows of seasons.
Key Data offers insights into the causes behind significant ABW declines: travelers may be postponing bookings due to perceived ample supply, or financial stress and reduced consumer confidence may be curbing demand.
Traditionally, Greater Palm Springs has witnessed spikes in ABW as temperatures cool down. Yet, the summer of 2023 has unveiled a noteworthy, consistent decline. The ABW for the summer of 2023 in this region has settled at 47 days, marking a 29% decrease compared to the same period the previous year.
What Adjusted Paid Occupancy Tells Us
Adjusted Paid Occupancy is another critical metric that determines the percentage of booked nights out of the total available nights for booking. It offers valuable insights into the performance of vacation rental properties. When analyzed alongside ABW data, it provides owners with valuable information for making informed business decisions.
For the month of August 2023, the paid guest occupancy in vacation rental homes was 13.2%, a notable decline from 19.1% in 2022 and 12.8% in 2019.
These figures collectively suggest a shift in the vacation rental market, reminiscent of pre-pandemic travel norms following a surge in travel during 2020 and 2021. In situations where occupancy is lower year-to-year and ABW has shortened, it's common to see occupancy recover as the stay date approaches.
What Should Vacation Rental Owners Do?
In light of these market trends, vacation rental owners must consider strategic adjustments, especially during slower seasons. Well-informed price adjustments for properties can be a key strategy to navigate the changing landscape.
Adapting to Change
The Coachella Valley vacation rental market is not immune to the wider shifts seen in the industry across the United States. Understanding and adapting to these market trends, as reflected in metrics like ABW and Adjusted Paid Occupancy, is essential for owners to remain competitive and thrive in this evolving landscape.
How AMG Vacation Rentals Can Help
As seasons change and the vacation rental market evolves, success comes down to making smart choices and being flexible. Choosing a premier vacation rental management company may be your next step. Find out how AMG Vacation Rentals can help you make informed decisions, maximize your returns, and protect your investment!