The rise of online marketplaces which provide short-term rentals and lodging services to visitors and tourists are giving a tough competition to the hotel industry. It has changed the way of traveling for most people. You can book a room from any corner of the planet in advance at prices that are 40-50 percent cheaper than a hotel.
The flexibility provided by these services is also contributing to their popularity. The service is user-friendly and you can terminate at your discretion at any time.
The Benefits Of Short-Term Rental Services:
- The first and most important benefit of these services is that they have increased the options available for travel accommodations. It has made it easy for travelers to find accommodation at costs that are considerably lower than hotels.
- They are flexible for both the guest and the landlord. The rental is available on-demand. They both have the option to cancel the service at any time by paying a small penalty. The guest has many options available to choose from and the landlord can ask for a rent amount that is competitive with the other options available in the nearby vicinity.
- The positive supply of short-term rental encourages a better experience for the guest because the landlord has to provide the best possible place to live at a price that is lower than the rates of the hotel.
- The service provides landlords with another stream of income. They can earn more money from short-term rentals than they will from long-term rentals. A single room in London will cost more than £80 a day and if we multiply it by 20( if 20 guests stay for a day in a single month) then it will amount to £1600. On the other hand, if you rent your property on a monthly basis then the rent you will get is around £1000-1200. You can check Airbnb UK Limited to get a more definitive idea.
- These services help boost the local economy. Cheap accommodation for travelers can act as a catalyst for stagnant tourist activities in a region. The revenue of local businesses and enterprises will go up when more tourists visit that place. This has a positive effect on the economy.
The Competition To Hoteling Industry
The rise of online short-term rental services has affected the business of the hotel industry. Hotels are suffering from slower sales while facing taxes and regulations from the government. They are also forced to review and amend their customer service policy. They are offering more flexibility in the terms of renting a hotel room/suite/lodging.
On the contrary, the short rental services are designed around the user experience. Their business model provides travelers comfortable and cheap accommodation, it provides landlords with another income stream and they take a small cut for providing this platform.
The future of these rental services depends on how the governments around the world will react to such services. Some cities have placed regulations and community councils are making laws to stop renting on a short-term basis. They argue that short-term rentals are driving the price of long-term renting up and disrupting the local environment due to the influx of outsiders.
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