Every year, millions of everyday people become entrepreneurs, or rentalpreneurs, in the short-term rental industry, seeking to boost their income and unlock financial freedom. Despite the fast-growing nature of the short-term rental market, rentalpreneurs’ earnings from their short-term rentals are falling behind compared to professional property managers with more tools and time. While 99% of Airbnb hosts have under 20 properties and only 0.4% fall outside this category, rentalpreneurs still face obstacles, in both accessing and succeeding in the industry.
Futurestay, a leading short-term rental management software provider is changing that with intuitive, impactful tech, designed specifically for the everyman and woman looking to prosper in the industry. For over 10 years, the company has been a leading innovator, helping more than 100,000 customers get started in the short-term rental market and compete with the bigger professional players. Philip Kennard, the founder of Futurestay, speaks often with rentalpreneurs looking for ways to do more with a property and make more money. To them, it seems like the market is slowing down, it’s oversaturated, or they aren’t making as much as they used to. In reality, a much more complex issue is occurring.
Despite persistent chatter that an “Airbnbust” in the short-term rental market is booming, demand for short-term rentals has grown consistently at over 15% per year since 2018 and hasn’t slowed, hitting 15.6% in 2023. The number of total unique listings sits at over 8 million globally, with 1.54 million available in the US alone, an increase of 12.3% year-over-year. That proves that demand growth is still outpacing supply growth.
Supply and demand could be argued away as vanity metrics. The most important health metric for any hospitality category is RevPAR (Revenue Per Available Room), which essentially means “how much each open night actually sells for”. Short-term rentals’ RevPAR has experienced 10 straight years of growth, recently rising from $112/night in 2019 to a wallet-scathing $156/night today. Supply is up, demand is up, and consumers are paying more for the privilege of staying in the average short-term rental.
Yet, many short-term rental managers and owners report shrinking revenue and profits, indicating a disconnect.
Short-term rentals are making much more than in 2021 because the market has expanded rapidly. However, if rentalpreneurs don’t feel like they’re making more, who is raking in the extra cash industry reports showcase? Enter a skewed success paradox.
Philip Kennard recently attended a mastermind conference with some of the most successful property managers and influential leaders in the short-term rental market. This annual tradition helps the group stay ahead of emerging trends and find strategies for shaping the industry’s future. During this event, one thing became clear. High performers weren’t seeing the “average” 12% year demand, supply, and ADR growth results. They weren’t just steps ahead - they were crushing their markets and driving 100%+ improvements year over year - running laps around the “average” host. This group had a diversified strategy for staying successful, and it involved multi-channel distribution (listing on multiple OTAs), building direct, no-commission website booking volume, building brand awareness through social media and other marketing strategies, and boosting margins through upsells and ancillary revenue.
The skewed success paradox is that some property managers, often large or enterprise ones, aren’t just beating the market - they are carrying it. While everyone else - often the 99% of rentalpreneurs in the market - is left behind. Some high performers have unique differentiators like rare or luxury properties with high-ticket offerings, but all listings are competing with other properties that rank similarly to them. So, what is the secret formula high performers are leveraging?
The underwhelming truth is that high performers are leveraging the same three weapons that any competitor, in any competitive field of business does:
Product;
Marketing;
Technology.
While rentalpreneurs theoretically have access to all these things, they’re regular people with limited time to perfect brand strategies and marketing funnels. Whereas their competitors–professional managers–are constantly sharpening the strength of their tools. However, rentalpreneurs can compete with the right solution.
Rentalpreneurs don't have to struggle because they have fewer resources than professional managers. They can leverage similar advantages that the top-performing hosts and managers have to become high performers in their own markets. They can use the same techniques entrepreneurs use to outcompete bigger opponents in other verticals: be innovative, scrappy, and nimble. They need to embrace the right solutions and not be intimidated or scared of technology.
Philip offers a few tips to rentalpreneurs who are just starting or looking to overcome a growth plateau:
Get a website with a booking engine and list your property on Google Vacation Rentals. Futurestay can provide a beautiful and professional website with a booking engine and payment processing in 6 minutes and have your property listed on Google shortly thereafter.
Invest in marketing your property even if just to friends and family. Start small and build on what works.
Deliver a quality guest experience. Start by creating your ideal guest “stay story” and then make sure the experience meets it. Rentalpreneurs can stand out online by understanding the traits of their average guest and accommodating their needs. They can make micro-investments into hands-on services that can transform an acceptable stay into an unforgettable experience.
Embrace emerging technology to do more with less, and explore the power of artificial intelligence. By inputting an ideal guest description into generative AI tools, they can receive local content about nearby activities and attractions that can become additional web pages. Overall, personalization is key for turning a viewer into a buyer.
In the quickly evolving landscape of short-term rentals, the technology eliminates barriers preventing rentalpreneurs from competing in the big leagues. Simple integrations and direct booking strategies are fundamental to driving occupancy, increasing margins, and ultimately achieving financial freedom. Futurestay eradicates the disparity rentalpreneurs encounter in today’s short-term rental market by empowering and equipping them with game-changing technology.
“As someone who founded the largest tech company for rentalpreneurs, we understand why most STR tech companies in the space move upstream,” says Futurestay’s founder Philip Kennard. “It takes a tech company the same effort to onboard an owner with one unit as an owner with 20 units, but you make much less money. So, to get this right, we’ve made it possible for rentalpreneurs to do it themselves, but with our help. We’re committed to creating a pathway for anyone to be successful in short-term rentals. Futurestay cuts through the complexity with powerful technology, end-to-end support, and a mindset that everyone should be able to build a profitable short-term rental business.”
Media Contact:
Name: Felicia Morales
Email: [email protected]
