3 Vacation Rental Industry Trends to Watch Through Labor Day

There’s no doubt about it: the vacation rental industry is super competitive these days, and owners everywhere need to be tuned into its shifting trends to win bookings. 

As we move through the summer — a peak season for many — imbalanced supply and demand growth continues to put us in a traveler’s market. But owners still have the opportunity to maximize revenue when they adapt their strategies based on the current climate.

To do this, it’s important to know what factors are at play — and how they’re shaping the landscape. Here are the top three vacation rental industry trends we’re monitoring now through Labor Day, so you can make the most of your performance potential.  

In This Article: 
Demand Is Rising, But Still Outpaced By Supply
Travelers Are Booking Farther in Advance
Competitive Daily Rates Are Helping Drive More Occupancy

1. Demand Is Rising, But Still Outpaced By Supply

So far this summer, there have been a lot of positive signs around traveler interest in vacation rentals. In May, for example, demand growth hit a 2024 high at 11.4% — which also reflected a year-over-year increase. Occupancy for the July 4th holiday also surpassed 2023 numbers, and Labor Day bookings are coming in earlier than they did last year, pointing to strong momentum in the market.

Combining these with economic considerations, demand is likely to stay strong for the remainder of summer. While inflation rates continue to drop, vacation expenses like food and airfare can still stretch budgets, so experts predict rentals will continue to climb as a top accommodation choice due to the convenience and cost-savings they tend to offer.

At the same time, mortgage rates remain high and new vacation rental regulations are popping up in jurisdictions across the country — which can make investing in this space more difficult. As a result, supply growth is slowing (particularly in non-coastal markets like the Midwest, Rocky Mountain, and desert regions). But it hasn’t slowed enough to reach a tipping point, meaning available inventory still outweighs overall demand and owners should expect competition for bookings to stay tight this summer.

2. Travelers Are Booking Farther in Advance

This year, our experts have seen traveler behavior begin to shift more firmly toward pre-pandemic trends. Families are planning around in-person schooling, and more workers are headed back to the office in hybrid or full-time capacities. Paired with the economic strain still felt by many, there’s a need to plan and budget.

That motivates many travelers to book dates for their main vacations ahead of schedule — locking in reservations more than 30 or 60 days before their trip begins. This June, for instance, bookings for future check-in dates were made 20% farther in advance year over year. And our experts are seeing the trend continue, with occupancy for August currently up 8% as compared to the same time last year. 

3. Competitive Daily Rates Are Helping Drive More Occupancy

With tight competition for summer bookings due to the continued imbalance between supply and demand — and longer booking windows — we’re seeing average daily rates stay fairly level. 

At Evolve, keeping rates reasonable (and often just below similar properties in a market) is part of a proactive strategy designed to drive occupancy and increase overall revenue. As guests booked farther in advance at higher volumes this May and June, our experts offered competitive rates early to secure more summer reservations — as well as fill any last-minute calendar gaps in July. As we look forward, rates are expected to remain in the same range, and are only anticipated to drop at the tail-end of August when most areas close out their peak season.

Summer Vacation Rental Industry Trends Are Resetting Performance

As we move through the next couple of months — and beyond — performance expectations differ as industry trends change. When you continually re-evaluate what the industry baseline for success looks like at any given time, you can more effectively work toward realistic and tactical performance goals.

Close and careful market analysis is a cornerstone of our management services, and a key component of how we help tens of thousands of owners maximize their performance potential.