February STR Performance: Winners, Losers & What’s Next

Jamie Lane, Chief Economist at AirDNA, and co-host Scott Sage, SVP of Marketing & Customer Experience, discuss February 2025’s STR performance.

They explore the latest data, including a 5% year-over-year demand increase and a 6% rise in Average Daily Rates (ADR). They also touch on the challenges of declining bookings in early March and regional fluctuations. Highlights include the impacts of major events like the Super Bowl in New Orleans and Beyoncé’s concert tour on short-term rental performance.

Jamie and Scott dive into how macroeconomic factors, like tariffs and tax changes, are affecting the short-term rental (STR) industry. They also share insights on managing your property’s pricing strategy during periods of economic uncertainty.

Plus, discover how forward-looking data can help you stay ahead of shifting trends and keep your rental profitable, even in volatile markets.

Here’s what you can expect from this episode

Gain insights into February 2025’s STR performance metrics, including demand and supply trends, ADR increases, and growth in Revenue per Available Rental (RevPAR).
Discover how major events impacted local markets, driving booking spikes and higher revenue.
Learn how to leverage real-time data to stay ahead of market shifts and make data-driven pricing decisions.
Understand how macroeconomic factors may influence future STR performance and how to adapt your strategy accordingly.

Episode Highlights

Demand and Supply Trends

February saw a 5% increase in demand and a 3.9% rise in supply, suggesting market stabilization after years of rapid growth. However, some markets experienced negative growth, highlighting the importance of closely monitoring local trends.

Notably, rural and mid-sized markets demonstrated stronger performance compared to urban areas and ski destinations, where occupancy rates showed a marked decline. Hosts in high-performing areas were able to maintain competitive pricing strategies, leveraging data-driven insights to optimize bookings and maximize revenue potential.

Revenue and ADR Insights

RevPAR increased by 5%, while ADR rose by 6%, reflecting the hosts' ability to maintain competitive pricing despite market challenges. Notably, the Repeat Rent Index (RRI) also showed positive momentum, indicating that hosts are successfully pushing rate increases.

The RRI tracks the price changes of existing rentals and removes the effect of newly added listings. Without RRI, looking at ADR spikes alone can paint a misrepresentative picture of host pricing power. New listings can drive average nightly prices up or down, even if existing vacation rental hosts haven’t changed their rates.

The positive trend in RRI can be attributed to a combination of strong demand and the hosts' ability to adapt pricing strategies to the changing market conditions. By leveraging forward-looking data and staying proactive, hosts have managed to sustain profitability even as some markets face economic headwinds. Additionally, insights from AirDNA's advanced analytics have empowered hosts to make more informed decisions, helping them capitalize on emerging opportunities.

Event Impact on STRs

Major events significantly boosted local bookings and ADR, emphasizing the value of capitalizing on event-driven demand. In cities like New Orleans, where the Super Bowl drove ADR up by 35%, hosts who stayed vigilant and adjusted rates accordingly saw impressive gains.

Similarly, cities on Beyoncé’s concert route are experiencing a noticeable uptick in bookings, especially in regions like Atlanta and Houston. This demonstrates how monitoring event calendars and aligning pricing strategies with anticipated demand can yield substantial financial benefits.

Economic and Market Outlook

Jamie discusses the potential impacts of tariffs, taxes, and economic uncertainty on the STR market, stressing the importance of monitoring local data and adapting strategies accordingly.

With ongoing economic fluctuations and potential recession risks, maintaining flexibility and leveraging data insights are crucial for hosts aiming to secure stable revenue streams. By focusing on local performance metrics and staying ahead of economic shifts, hosts can build resilient strategies to weather unpredictable market conditions.

Key Takeaways

Be Data-Driven

Regularly monitor local STR performance metrics to identify trends and adapt your strategy. Use tools like AirDNA to access up-to-date insights that inform smarter pricing decisions.

Leverage Event Opportunities

Capitalize on high-demand periods by adjusting pricing to match surging interest. Events like major sports games or concerts can significantly boost revenue when managed strategically.

Stay Flexible

Maintain a proactive approach to economic changes and market-specific shifts that could impact performance. Build contingency plans to mitigate revenue risks during periods of uncertainty.

Connect with Jamie on LinkedIn and Twitter:

LinkedIn: https://www.linkedin.com/in/jamiehlane/

Twitter: https://twitter.com/Jamie_Lane

Connect with Scott on LinkedIn:

LinkedIn: https://www.linkedin.com/in/sagescott

Connect with AirDNA on LinkedIn, Twitter, TikTok, and Instagram:

LinkedIn: https://www.linkedin.com/company/airdna/

Twitter: https://twitter.com/airdna

TikTok: https://www.tiktok.com/@airdna.co

Instagram: https://instagram.com/airdna.co

Listen On:

Up Next:

Assessing Economic Uncertainty and Its Impact on the STR Industry

What does economic uncertainty really mean for short-term rental (STR) operators? In this episode of the STR Data Lab, AirDNA Chief Economist Jamie Lane and Director of Economic and Forecasting Bram Gallagher take a deep dive into today’s shifting macroeconomic landscape.

With stock market swings, inflation expectations, new tariffs, and falling consumer confidence, the STR industry is bracing for potential turbulence. Despite these headwinds, however, data-driven strategies can help hosts and investors stay the course.

Whether you're concerned about volatility in international travel, the wealth effect from equity declines, or the impact of inflation on guest behavior, this episode arms you with the insights you need to make smart, proactive decisions.

Here’s what you can expect from this episode:

Why the Economic Policy Uncertainty Index has surged to its highest level since COVID-19—and what that means for STR operators
How consumer sentiment and stock market volatility influence travel behavior
The role of tariffs and trade tensions in reducing international demand (especially from Canada)
Why certain markets are more exposed to economic instability
How to interpret current economic fundamentals and what downside risks might mean for 2025

Episode Highlights

The Rise of Economic Policy Uncertainty

Jamie and Bram open the conversation with a look at why uncertainty is the watchword of the moment. Despite healthy indicators like low unemployment and stable GDP growth, perception is everything—and consumer confidence has been falling. Bram points to the Economic Policy Uncertainty Index, which recently hit levels not seen since the early days of the pandemic.

Why the spike? A mix of factors: political turnover, trade policy changes, and headline-driven market reactions. The lesson for STR stakeholders: even with a solid economic base, psychological signals like consumer unease can drive real behavioral shifts in travel planning.

Tariffs and Travel: A Risk to International Demand

One standout discussion centers on tariffs—both their immediate and ripple effects. The U.S. has implemented broad-based tariffs targeting imports from Canada, Mexico, and China, which not only impact prices but also stir retaliatory action from trading partners. For STR operators, this matters.

Data shows a dramatic 70% to 75% drop in flight demand from Canada to the U.S., and some major routes have been canceled altogether. That’s significant when Canadian travelers made up 2.6% of U.S. STR demand last year. In markets like Buffalo, New York; Fort Lauderdale, Florida; and Maui, Hawaii where international travelers form a substantial portion of bookings, the implications are real and potentially lasting.

The Wealth Effect and Stock Market Volatility

Consumer spending patterns often shift in tandem with the stock market. Even if job numbers remain strong, when consumers see their portfolios shrink, they start looking for ways to cut back—travel included.

This "wealth effect" hits higher-income earners particularly hard. While households earning over $125,000 have maintained strong confidence so far, a major market correction could change that quickly. That means luxury STRs might feel the pinch first.

Business and Government Travel Cutbacks

Another key signal: a sharp downturn in business and government travel. Forward-looking data shows government bookings down 80% and corporate bookings down 45%. Combined, these two segments account for nearly 18% of the overall lodging demand. While short-term rentals lean more toward leisure travel, hotels slashing rates to compete could lead to price pressure across the board.

Operators should take note: in times of economic instability, even indirect exposure to business travel trends can impact your revenue outlook.

Inflation, Currency Fluctuations, and STR Demand

Tariffs are also fueling inflation expectations. With inflation, the value proposition of travel weakens—particularly for international guests facing unfavorable exchange rates. A stronger U.S. dollar makes U.S. stays more expensive, further curbing demand from abroad.

Some travelers may opt to stay local, travel less, or shorten their stays. For STR hosts, that means refining marketing efforts and offering competitive pricing becomes even more critical.

Geography Matters: Markets at Greater Risk

The episode highlights how exposure to international markets varies significantly by region. Canadian travelers, for example, represent more than 10% of STR demand in markets like Buffalo, New York; Bellingham, Washington; Maui, Hawaii, and parts of Florida.

Operators in these areas should monitor booking trends closely and consider domestic targeting strategies to offset declines. Leveraging AirDNA tools to identify emerging domestic demand can offer a strategic edge.

So, Where Do We Stand?

Despite all the red flags, Bram and Jamie emphasize that core economic indicators remain resilient—for now. Employment is strong, inflation was mild last month, and industrial production is steady. That being said, risks are building. Falling labor force participation, equity market vulnerability, and rising tariffs all point to increased downside potential.

The consensus? Economic uncertainty is here, but panic isn’t necessary. STR operators should use data to track demand shifts and be ready to pivot.

Actionable Insights for STR Hosts and Investors

Watch the data, not the headlines. Economic fundamentals still support growth, but keeping an eye on emerging metrics is crucial.
Know your market’s risk exposure. If your STR relies on international travel or corporate stays, it's time to reassess.
Adapt your pricing strategy. Use AirDNA’s Dynamic Pricing tools to stay competitive if demand softens.
Promote domestic travel. Redirect marketing to U.S. travelers and highlight value, flexibility, and local attractions.
Plan for different scenarios. Develop both conservative and optimistic forecasts based on the evolving economic landscape.

Final Takeaway

Economic uncertainty doesn’t have to spell disaster for short-term rentals. With the right insights and tools, you can anticipate changes and stay ahead of the curve. Tune in to Episode 126 of The STR Data Lab for a thoughtful, data-backed breakdown of how macroeconomic shifts could affect your strategy—and what to do about it.

Listen now and future-proof your STR business.

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