Booking Windows Tighten, but Early Bookings Still Drive the Revenue Engine

Uvika Wahi

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Booking Windows Tighten, but Early Bookings Still Drive the Revenue Engine

At this year’s VRWS conference in Porto, Key Data’s Sally Henry revealed a surprising trend: while short-term rentals are seeing a surge in last-minute bookings (within 14 days of arrival), the bulk of revenue is still coming from reservations made far in advance—between 60 and 179 days. This gap between when bookings happen and where revenue comes from offers a unique opportunity for property managers to rethink their pricing and booking strategies, ensuring they’re not only filling last-minute gaps but also securing high-revenue early bookings.

Setting the Context: Key Data and the VRWS 2024

These insights were presented at the Vacation Rental World Summit (VRWS) in September 2024 by Sally Henry of Key Data, a leader in vacation rental analytics. Key Data sources its information through direct integrations with property management systems, collecting real-time reservation data across millions of daily API calls to platforms like Airbnb and Vrbo. This means the insights come directly from property managers’ systems, providing highly accurate market trends. However, because this data is primarily sourced from traditional vacation rental listings rather than urban short-term rentals, the trends may reflect a heavier focus on traditional holiday destinations.

Occupancy and Revenue: The Global Landscape

Key Data’s report showed that while global paid occupancy saw positive results in 2023 compared to pre-pandemic 2019 levels, certain markets are now facing slowing growth, with North America and Oceania showing slight declines, particularly as they pace for 2024.

Annual Average Daily Rate By Continent

This slide illustrates the Average Daily Rate (ADR) by continent.

Actionable Insight for Managers:
If you manage properties in North America, you might already be seeing this trend firsthand. Now is the time to re-evaluate your marketing channels and strategies, focusing on increasing visibility in less saturated areas or optimizing your property for off-peak seasons to drive occupancy.

Booking Windows: Short vs. Long-Term Strategies

The most eye-catching data point was the trend around booking windows. While a significant proportion of bookings are made within 14 days of stay, the majority of revenue is generated from bookings made between 60 to 179 days in advance. Europe shows a higher concentration of last-minute bookings, but in both the U.S. and Europe, advance bookings remain essential for revenue stability.

2024 Percent of Reservations by Source

This slide illustrates the percentage of 2024 reservations by booking window.

Actionable Insight for Managers:
You should adapt your pricing strategies to take advantage of both short and long-term booking windows. For last-minute bookings, dynamic pricing can help maximize occupancy rates, while offering early-bird discounts can incentivize travelers to book far in advance, securing revenue.

Booking Sources: The Rise of Booking.com and the Shift Away from Airbnb

Booking.com continues to grow its presence in Europe, outpacing Airbnb, which, in contrast, is gaining ground in the U.S. However, both platforms remain crucial for different markets, and understanding these shifts is essential for maximizing the channel mix.

Percent of Reservations by Source Change Over Time

This slide illustrates the percentage of 2024 reservations categorized by stay length.

Actionable Insight for Managers:
If your portfolio includes European properties, it may be time to reallocate your channel strategy toward Booking.com. Consider optimizing your listings for this platform while continuing to leverage Airbnb’s reach in the U.S. In either case, don’t neglect direct bookings—consider how these channels’ commission structures impact your profitability.

Stay Lengths and Guest Behavior: Shorter Stays Are on the Rise

Stay lengths are shrinking across the board. In both Europe and the U.S., bookings for stays between 3-5 days have risen consistently, while longer stays (6-8 days) are seeing a steady decline. This shift reflects a broader behavioral change as travelers seek shorter, more frequent trips.

2024 Percent of Reservations by Stay Length

This slide illustrates the 2024 percentage of reservations by stay length.

Actionable Insight for Managers:
To capitalize on this trend, you should review your minimum stay requirements and adjust them based on demand. Offering flexibility, such as enabling guests to book shorter weekend stays, could boost your property’s appeal and align with evolving travel behaviors.

Property Size Trends: The Popularity of Smaller Units

In Europe, 76% of reservations in 2024 were for one- or two-bedroom properties, while the U.S. saw higher demand for slightly larger properties with 2-3 bedrooms. This points to an ongoing trend favoring smaller, more affordable units, especially as travelers respond to rising rates.

2024 Percent of Reservations by Bedrooms

This slide illustrates the 2024 percentage of reservations by the number of bedrooms.

Actionable Insight for Managers:
If you manage larger properties, it’s worth considering dividing them into smaller units where feasible or positioning your larger properties for group travel. Additionally, optimizing your marketing for couples or small groups might help you capture more of this growing segment.

Inventory Growth and Churn: Navigating a Competitive Landscape

The data also highlighted inventory growth, with the U.S. and Europe both seeing net positive changes. However, inventory churn remains a challenge, with property supply increasing year over year.

Inventory Change Rate - Past 12 Month Average Change Over Time

This slide illustrates the inventory change rate.

Actionable Insight for Managers:
Take the time to analyze your competitive landscape. With more properties coming online, ensuring that yours stands out through guest reviews, exceptional amenities, or unique experiences will be key to maintaining a competitive edge.

Conclusion: Broader Trends, Local Insights

The data presented by Key Data at VRWS 2024 offers valuable insight into global and regional trends shaping the short-term rental industry. However, while these broad trends—such as shifts in booking windows, shorter stays, and changing booking channels—are critical to understand, they’re just one part of the equation. For property managers to truly capitalize on these insights, it’s essential to pair them with more granular, localized data that accounts for your market’s unique sensibilities.

Each region, and even each property type, will respond differently to these larger patterns. By leveraging localized data alongside these broader trends, you can fine-tune your strategies, pricing, and operations to fit the specific demands of your market, ensuring you stay competitive and profitable.