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What is the present valuation and projected CAGR of the vacation rental market?
The vacation rental market size has grown strongly in recent years. It will grow from $89.45 billion in 2024 to $95.67 billion in 2025 at a compound annual growth rate (CAGR) of 7.0%. The growth in the historic period can be attributed to the rising tourism sector, increasing travel habits, regulatory changes and local policies, high demand during peak travel seasons, and growth in urbanization.
The vacation rental market size is expected to see strong growth in the next few years. It will grow to $123.4 billion in 2029 at a compound annual growth rate (CAGR) of 6.6%. The growth in the forecast period can be attributed to the rising adoption of efficient promotional tactics, the increasing growth of remote work, rising disposable incomes, and the growing concentration on celebrity endorsements. Major trends in the forecast period include integration with online platforms, adoption of technology such as smart locks, a shift towards longer-term rentals, customization of guest experiences through personalized amenities and contactless check-ins, and safety measures.
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Vacation Rental Market Report 2025
What key drivers have fueled the vacation rental market’s development over the years?
The growth in the travel and tourism sectors is expected to propel the growth of the vacation rental market going forward. The travel and tourism sectors are comprehensive and multifaceted, encompassing everything from the transportation methods that carry travelers to their destinations to the wide array of services and experiences that make travel enjoyable and memorable. The growth in the travel and tourism sectors is due to improved transportation infrastructure, globalization, trade liberalization, a rising preference for experiential travel, and a rising interest in health and wellness tourism. Vacation rentals benefit the travel and tourism sectors by providing diverse accommodation options, boosting local economies, supporting longer stays, and enhancing traveler experiences with more personalized and flexible lodging alternatives. For instance, in April 2024, according to the World Travel and Tourism Council, a UK-based forum for the travel and tourism industry, in 2023, travel and tourism accounted for around 9.1% of the global gross domestic product (GDP), totaling over $9.9 trillion. It forecasts continued growth in the sector, with expectations of its GDP contribution reaching $11.1 trillion by 2024. Therefore, the rapid growth in the travel and tourism sectors is driving the growth of the vacation rental market.
What is the segmentation for the vacation rental market?
The vacation rental market covered in this report is segmented –
1) By Accommodation Type: Home, Resort Or Condominium, Apartments, Hometown, Villas
2) By Price Point: Economic, Mid Range, Luxury
3) By Booking Mode: Online, Offline, Other Booking Modes
4) By End User Generation: Generation Zoomer, Millennials, Generation X, Boomers
Subsegments:
1) By Home: Single-Family Homes, Luxury Homes, Beach Houses, Country Homes, Eco-Friendly Homes
2) By Resort Or Condominium: Resort Villas, Condo Units in Resorts, Timeshare Properties, All-Inclusive Resort Rentals
3) By Apartments: Studio Apartments, 1-Bedroom Apartments, 2-Bedroom Apartments, Luxury Apartments, Penthouse Apartments
4) By Hometown: Local Guesthouses, Traditional Hometown Inns, Bed And Breakfasts (B And Bs), Historic Homes, Boutique Hotels
5) By Villas: Luxury Villas, Poolside Villas, Beachfront Villas, Private Villas With Staff, Eco-Friendly Villas
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Vacation Rental Market Report 2025
Who are the most influential companies in the vacation rental market?
Major companies operating in the vacation rental market are Airbnb Inc., Wyndham Destinations Inc., Agoda Company Pte. Ltd., TripAdvisor LLC, Vacasa LLC, Trivago GmbH, Priceline LLC, VRBO Inc., NOVASOL A/S, http://Hotels.com L.P., MakeMyTrip Pvt. Ltd., Pacaso Inc., KAYAK Software Corporation, AvantStay Inc., Hotelplan Management AG, HotelsCombined Pty Ltd, Whitetail Properties Real Estate LLC, Stellar MLS, Elliott Realty Group, 9flats GmbH, Panhandle Getaways Inc., StayMarquis LLC, Coastal Living Group LLC
What are the top industry trends projected to impact the vacation rental market?
Major companies operating in the vacation rental market are focusing on expanding their businesses through innovative solutions such as premium vacation rental homes to attract high-end travelers, enhance guest experiences, and differentiate themselves in a competitive market. Premium vacation rental homes are high-end luxury properties that offer exceptional amenities, superior comfort, and unique experiences, catering to travelers seeking upscale accommodations and personalized services during their stay. For instance, in June 2024, OYO Rooms, an India-based hospitality company, launched the premium vacation rental brand Belvilla in partnership with Sojo Stays, a UK-based apartment rental chain, to offer a curated collection of Belvilla by Oyo vacation homes in prime locations across several major UK cities. Guests can book these Belvilla properties for short-term and longer stays through the Belvilla platforms and other booking sites. The launch of Belvilla by Oyo in the UK represents the company’s efforts to diversify its geographic footprint and capitalize on the growing demand for premium vacation rental experiences.
What are the major regional insights for the vacation rental market, and which region holds the top position?
Europe was the largest region in the vacation rental market in 2023. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the vacation rental market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa.
What Does The Vacation Rental Market Report 2025 Offer?
The vacation rental market research report from The Business Research Company offers global market size, growth rate, regional shares, competitor analysis, detailed segments, trends, and opportunities.
A vacation rental is a type of lodging where homeowners or property managers rent out fully furnished properties or individual rooms within properties to travelers and tourists on a short-term basis. They offer an alternative to traditional hotel accommodations, often providing more space, privacy, and amenities tailored to the needs of travelers. Vacation rentals offer a versatile and often cost-effective lodging option for travelers seeking more space, privacy, and home-like comforts.
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Vacation Rental Market Report 2025
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