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Business PlansNavigating the 2024 STR Landscape: Insights from AirDNA's Outlook Report with Bram Gallagher
In Episode 61 of STR Data Lab, Jamie Lane sits down with Bram Gallagher, fellow economist at AirDNA, to review this year's performance and forecast the 2024 outlook for the U.S. short-term rental industry.
2023 brought challenges for STR operators, with a 4.9% drop in RevPAR — the first annual decline since AirDNA began tracking data in 2014. Yet, the industry saw remarkable milestones, with record-high demand in July and over 1.6 million listings by September. The economic landscape showed resilience, with unemployment remaining below 4% and a trend of declining inflation. However, these positive economic indicators, along with a growth in property supply, led to a leveling off in occupancy gains. STR operators experienced reduced pricing flexibility, as travelers showed a growing preference for more budget-friendly accommodation options.
The absence of a recession in 2023, thanks to effective Federal Reserve measures, paves the way for a stable economic outlook in 2024. Factors such as declining inflation, strong employment, and excess savings are expected to fuel consumer spending. While the Fed may maintain high-interest rates, a potential rate cut by the end of 2024 could influence mortgage rates. The housing market, currently grappling with affordability issues, faces potential risks, with projections indicating a 2% decrease in home prices by 2024. The economic scenarios discussed include moderate downside, upside, and severe downside, each impacting revenue growth.
The AirDNA 2024 Outlook Report predicts a positive shift in the market. Economic recovery is expected to boost demand growth to 10.7%, a rebound from 6.7% in 2023. Supply growth, moderated by high mortgage rates, is likely to align with demand, estimated at 10.9%. Occupancy rates are projected to stabilize at 54.7%, similar to 2023 levels. Average Daily Rates are expected to increase by 2.1%, leading to a 1.9% rise in RevPAR. Despite some economic uncertainties, the market outlook is cautiously optimistic. Bram concludes with a positive note on strong labor market growth as a promising sign for the coming year.
You don’t want to miss this episode!
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2024 Outlook Report:
https://www.airdna.co/outlook-report-2024
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Signup for AirDNA for FREE👇
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Connect with Jamie on LinkedIn and Twitter:
LinkedIn: https://www.linkedin.com/in/jamiehlane/
Twitter: https://twitter.com/Jamie_Lane
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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
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Find AirDNA at these upcoming events!
Up Next:
Welcoming Uplisting to the AirDNA Family: Leveraging Property Management Systems in Short-Term Rentals
In this episode of STR Datalab, Jamie Lane is joined by Demi Horvat, CEO of AirDNA, and Vinny Breslin, founder of Uplisting. They dive into the exciting news of AirDNA's recent acquisition of Uplisting, marking a significant union of two major players in the short-term rental industry.
Vinny shares the journey of Uplisting, from its early days in London to becoming a powerhouse in the Airbnb software space. The discussion covers the challenges faced, milestones achieved, and the pivotal role Uplisting plays in streamlining property management for hosts.
Demi sheds light on the strategic rationale behind the acquisition, emphasizing the desire to bridge the gap between property acquisition and operations. The goal is to simplify the lives of short-term rental hosts by offering a comprehensive suite of tools under one umbrella. The episode delves into the key differentiators of Uplisting, such as reliability and customer support, and explores why a Property Management System (PMS) is crucial, especially as hosts expand beyond platforms like Airbnb.
The episode wraps up by highlighting the vision for the combined forces of AirDNA and Uplisting, envisioning a streamlined experience for hosts, catering to a wider market, and addressing the unique needs of smaller operators. This episode is a must-listen for anyone in the short-term rental space, offering insights into industry dynamics, the power of acquisitions, and the evolution of property management systems.
You don’t want to miss this episode!
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More about Uplisting:
https://www.airdna.co/airdna-acquires-uplisting-press-release
~~~~
Signup for AirDNA for FREE👇
~~~~
Connect with Jamie on LinkedIn and Twitter:
LinkedIn: https://www.linkedin.com/in/jamiehlane/
Twitter: https://twitter.com/Jamie_Lane
~~~~
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
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Find AirDNA at these upcoming events!