Short Term Rentals Market Size, Share, Growth, and Industry Analysis, By Type (Serviced Apartments, Corporate Housing, Aparthotels, Resort/Condominium), By Application (Online, Offline), and Regional Insights and Forecast to 2034

•   
•   
  

  Request a Free sample to learn more about this report

    

SHORT TERM RENTALS MARKET OVERVIEW

The global short term rentals market size was USD 133.847 billion in 2025 and is projected to touch USD 306.932 billion by 2034, exhibiting a CAGR of 10.93 % during the forecast period.

The United States Short Term Rentals market size is projected at USD 45.267 billion in 2025, the Europe Short Term Rentals market size is projected at USD 31.280 billion in 2025, and the China Short Term Rentals market size is projected at USD 37.865 billion in 2025.

Short term rentals industry has grown tremendously over the last 10 years owing to the emergence of online sites, like Airbnb, VRBO and Booking.com. This market provides a replacement of traditional hotels and bed-and-breakfast and gives home owners and property managers an opportunity to profit out of unused space and offers travelers with unusual and usually cheaper accommodation. The market is likely to be fuelled by high demand of short term rentals in the cities, especially the urban cities that experience a large level of tourism.

The recent trends in the short term rentals market are the emergence of boutique or luxury rentals, high competition between the traditional hotels and short term rentals, and the high engulfment of regulations and taxes applied to short term rentals. Moreover, it is felt that the market will be affected by the popularity of the peer-peer renting and the usage of technology in the management and booking of short term rentals. With the market still undergoing change, it is predictable that the players will aim at refining the guest experience, making it more efficient and profitable and also respond to the changing regulatory conditions. Short term rentals market is likely to continue playing a large role in accommodations worldwide, and it may be exploited to expand and innovate in emerging environments like sustainability, intelligent homes, and customized experiences of guests.

COVID-19 IMPACT

Short Term Rentals Industry Had a positive Effect Due to increased demand private spaces and amenities during COVID-19 Pandemic.

Covid-19 had a notable impact on the Short Term Rentals market share. The COVID-19 pandemic affecting the world today has been unprecedented and staggering, and greater-than-expected demand has been experienced in the market than anticipated in all regions as compared to pre-pandemic. This spur in the market as indicated by showing an increase in CAGR can be explained by the fact that the market is growing and the demand is going back to the pre-pandemic state.

The pandemic of coronavirus affected the short term renting market considerably. Due to the introduction of travel bans and lockdowns worldwide, the short-term rental market stagnated, thus causing a significant drop in the number of bookings and incomes on property owners and managers. Most short-term accommodation sites like Airbnb and VRBO received a considerable decline (both in their number of listing and in the number of the bookings) when travelers began to cancel their tickets and switch to more conventional solutions such as hotels and motels.

Nevertheless, when the restrictions on traveling were step by step lifted, and the vaccination progressed, the market with short-term rentals started improving. As a significant portion of the population was allowed to work remotely, and alternative forms of vacations were sought, there was a rise in demand in short-term rentals, especially in residences with areas that could be used privately and accommodated remote workers. Consequently, owners and managers of property modified themselves to the new market condition by providing better cleaning and sanitizing measures, augmenting their efforts in the online environment, and providing flexibility in booking practices to win travelers.

LATEST TRENDS

Smart Home Integration to Drive Market Growth

In the short run rentals market Smart Home Integration is going to be very popular in the short term rentals market because the travelers are getting used to having an easy convenient experience during their stays. Such a tendency comprises the voice control thermostats and intelligent locks which allow to check in and out without any troubles. Smart home technology is increasingly being used by many property managers nowadays to offer better staying experience to guests and help them to stand out among competitors. As well, the adoption of smart home equipment assists property owners to maximize energy consumption and minimize maintenance expenses. Reservation is also likely to get a high rate of booking when smart features (homes) are incorporated in the property because they enhance the general beauty and modernity of the accommodation. This trend will go on increasing as the smart home technology becomes easier to acquire and implement.

•   
•   
  

  Request a Free sample to learn more about this report

    

SHORT TERM RENTALS MARKET SEGMENTATION

By Type

Based on Type, the global market can be categorized into Serviced Apartments, Corporate Housing, Aparthotels, Resort/Condominium.

• Serviced Apartments: Serviced Apartments The Serviced Apartments offer furnished and equipped apartments for short-term stays that usually provide features such as kitchen and laundry. Business travelers and families that need a home like environment prefer them. Services provided by serviced apartments include house-keeping to concierge.

• Corporate Housing: Corporate Housing is a company that deals with the individuals who work with corporations and their families when they move or when they are on temporary assignments, and they need the apartments to be fully furnished. Such units are typically offered long-term and include such amenities as a gym and a pool. Corporate housing offers a convenient living experience without any trouble.

• Aparthotels: Aparthotels are hybrid hotels, which have come to join the luxury of a hotel with that of an apartment. They suit travellers who would like bigger spaces and flexibility that a normal hotel room offers. The aparthotels are likely to provide other facilities such as food and drinks.

• Resort/Condominium: Resort/Condominium rentals work as all-luxury rentals, analogous to resort complexes or condominium developments. The units are ideal when the family or a group of individuals want to have a holiday feeling where they have resort facilities such as pools and restaurants. The resorts/condominiums come in various forms including studios to multi-bedroom apartments as per rental.

By Application

Based on application, the global market can be categorized into Online, Offline.

• Online Applications: With Online short-term rentals, there are numerous possibilities of accommodation upon travel They also provide users with a chance to search and make reservations depending on their destinations and prices. Online short-term rental platforms are presented by platforms such as Airbnb and Booking.com.

• Offline Applications: Offline short-term rentals entail conventional methods in marketing and advertisements. Tourists can see the properties available in a brochure and advertisement at tour information centers. The property managers and the real estate individuals are the ones who deal with the offline booking and transaction.

MARKET DYNAMICS

Driving Factors

Rise of Digital Nomads to Boost the Market

A factor in the Short Term Rentals market growth is the Rise of Digital Nomads. Digital nomadism, the trend of working remotely and traveling frequently, is one of the main forces in the short-term rentals market as more people may need accommodations that can support their lifestyles, flexible and convenient short-term rentals can then fulfill the demands and hence result in the influx of short-term rentals demand, especially in the most popular locations, digital nomads are likely to emphasize on, high-speed internet access, co-working space, and proximity to the attractions in the area.

Growing Demand for Unique Experiences to Expand the Market

Another motivating factor in the business of short-term rentals is that the trend towards unique experiences that cannot be found in a hotel continues to increase, travelers are looking to have experiences that can only be memorable, and short-term rentals provide an opportunity to truly live like a local and experience the culture and day-to-day life of a destination, one-of-a-kind rentals, such as treehouses, villas and apartments in historic buildings, are becoming highly demanded components of the short-term rentals market and can truly offer a one-of-a-kind experience.

Restraining Factor

Regulatory Frameworks to Potentially Impede Market Growth

There is a significant limiting force against the expansion of short term rentals which is Regulatory Frameworks. Its competitor Airbnb is becoming more heavily regulated by the governments in the fear of safety, noise pollution and displacement of low-priced housing. These laws may restrict rentals access and hosts will find it difficult to be in business and guests will not be able to get appropriate places to stay. Even restrictive laws have been issued in certain cities causing short term rentals to be prohibited altogether. This may affect the local economy negatively since short time rents usually present a major source of income to the locals. The vagueness in regulation may also scare possible hosts to the market as well.

Adoption of augmented reality (AR) To Create Opportunity for the Product in the Market

Opportunity

The forthcoming future represents a time when renting an activity to an infinite number of possibilities where augmented reality (AR) infused vacation renting becomes a desired experience and therefore an industry product driven by the market. These rentals will have in place the augmented reality enabled smart glasses and gadgets through which the guests will be able to experience engaging with the property, its environment and its attractions in a new manner altogether.

Visitors will have a chance to learn the historical sights and visit virtual exhibitions or attend even the local event using the comfort of their rental. This will be a magic bullet that will change the way the world is being explored by people in a much interesting, educative and retentive manner. The AR rentals will also support the rising popularity of the experience travel and offer hosts with an added selling point. But in the short-run rentals, in the future, AR-infused organizations will be the new normal and how and what travelers want to immersion by 2050.

Increasing demand for seamless and high-tech experiences Could Be a Potential Challenge for Consumers

Challenge

On the one hand, as the market of so-called the 'Short Term Rentals' goes on developing, another threat is arising: the so-called the Smart Stay. The highly demanded seamless, high-tech experiences have forced short-term rental hosts to introduce additional AI-powered virtual concierges, real-time translation services, and automated home maintenance systems to develop an even more futuristic experience of their guests. The issue concerns the development of the immersive, intelligent environment capable of locating the needs and preferences of the guests without any failure of communication as well as the unsurpassed ease.

It needs sophisticated data analytics, the possibility of connecting with the smart home, and a prolific knowledge of the guest behavior. The objectives are to re-imagine the limits of hospitality, creating the unforgettable, technology-enhanced experience with each and every stay.

•   
•   
  Request a Free sample to learn more about this report

    

SHORT TERM RENTALS MARKET REGIONAL INSIGHTS

• North America

North America is the fastest-growing region in this market. The United States Short Term Rentals market has been growing exponentially owing to multiple reasons. In North America, high demand of short-term rental properties is leading to the growth of the short-term rentals market in the region. Other large market segments are pioneered by Airbnb and VRBO that lead in the market, although the US gives the greatest contribution. The state is projected to experience a massive surge in the short-term rentals as the gig economy and consumer behaviors are evolving. Great centers such as New York and Los Angeles are hot spots, and luxury and boutique accommodation are in great demand. There is also the increase in niche markets such as glamping and vacation rentals in the region.

• Europe

Local regulation and tax are the elements that play a large role in the European market of short-term rentals. The short-term renting regulation on cities such as Paris, London, and Amsterdam is too stringent thereby increasing illegal renting. Nonetheless, the market has been showing no signs of slowing down with the emergence of digital platforms and the modification of consumer practices. Corporate travel as well as business rentals is also on raised form in the region.

• Asia

The Asia Pacific market of short-term rentals is facilitated by high growth of the middle-income sector and the demand in budget and flexible housing. One of the leading countries is Japan, China, and Australia, and so they have been in demand of luxury and boutique accommodations. Short-term rents may rise greatly in the region with the emergence of digital platforms and shifts in consumer attitudes. Cities such as Tokyo, Singapore and Hong Kong are some of the hottest spots with a large patronage to luxury and high-end hotels. There is also the increase in niche markets such as glamping and vacation rentals in the region.

KEY INDUSTRY PLAYERS

Key Industry Players Shaping the Market Through Innovation and Market Expansion

Key industry players are shaping the short term rentals marketplace through strategic innovation and market expansion. These companies are introducing advanced techniques and processes to improve the quality and performance of their offerings. They are also expanding their product lines to include specialized variations, catering to diverse customer preferences. Additionally, they are leveraging digital platforms to increase market reach and enhance distribution efficiency. By investing in research and development, optimizing supply chain operations, and exploring new regional markets, these players are driving growth and setting trends within the short term rentals.

List Of Top Short Term Rentals Companies

• Vector Travel [U.S.]
• Hotelplan Holding AG [Switzerland]
• FlipKey [U.S.]
• Tripping.com [U.S.]
• Vrbo [U.S.]

KEY INDUSTRY DEVELOPMENT

March 2024: The Dynamic Pricing Tool 2.0 by Vector Travel allows optimizing nightly rates in short-term rental properties by using AI and real-time market data. The tool uses demand and local events, occupancy trends and competitor analysis to adjust pricing. It assists hosts and property managers to generate maximum revenue and enjoy elevated occupancy. Its updated version is distinguished by better automation, dashboard analytics, and larger rental platforms integration.

REPORT COVERAGE

SWOT analysis is presented in this work at a high level, and helpful recommendations regarding further evolvement of the market are considered. This paper takes an opportunity to review and discuss the market segments and possible applications that have the potential to influence the market growth in the future years. The short term rentals with better portability is expected to gain high growth rates due to better consumer adoption trends, increasing application areas, and more innovative product developments. Yet, there might be some problems like, for instance, the shortage of raw materials or higher prices for them. However, the growing popularity of specialized offerings and tendencies towards enhancing quality foster the growth of the market. All of them are progressing through technology and innovative strategies in developments as well as in supply chain and market. Due to changes in the market environment and growing demand for variety, the short term rentals has a promising development since it constantly develops and expands its application.