This past summer continued to see a return to the demand of pre-pandemic times, resulting in less traffic compared to the 2020-2023 years. The reduced demand also created greater availability and some recent softening of prices.
In a recent survey, nearly 20% of respondents reported to us that they had more success than usual, while 60% said they had done about the same as in the recent past. The remaining 20% had done worse than normal.
Booking trends for 2024.
A Look at Bookings
Summer bookings on the Cape were on par with last summer but down nearly 7% and 4% on the Vineyard and Nantucket respectively. The booking downturn on the Islands was due to a number of factors, not the least of which was the increase in overall pricing, which may have discouraged potential renters. Other factors include problems with the ferry reservation system early in the year and greater inventory on the Vineyard than in recent years.
Booking rates across various locations.
Fall bookings were up 8% on the Cape compared to last fall, while down 11% and 13% on the Vineyard and Nantucket respectively. But compared to pre-pandemic years, fall bookings are up about 20% on the Cape and Nantucket and down 2% on the Vineyard.
Fall booking trends for 2024.
Unprecedented Price Increases
In tracking pricing trends over the last 26 years, we’ve typically seen a 2-4% price increase year over year…until the pandemic. Since then, however, we have seen price increases of nearly 10% a year! Even though demand weakened in 2023 and 2024, prices continue to be very high by historical measures.
Pricing increase trends over recent years.
...some owners had been too aggressive in their initial pricing
We observed a marked increase in price drops beginning in May of this year. Of those owners who dropped their prices, the average reductions were 8-15%, the largest we’ve ever seen during a season. This was an indication that some owners had been too aggressive in their initial pricing.
Price reductions across vacation homes.
Pricing your home is nuanced and dependent on several factors, not the least of which is your experience. Did you book easily by early in the year, or did you struggle and have to discount? Do you get a number of repeat guests? Have you made enhancements to your home?
Vacationer demand dictates rates, not owner expenses.
Don’t be tempted to raise your rates because you hear that others are doing so or because your expenses have risen. Vacationer demand dictates rates, not owner expenses. Energy costs, labor, and materials have increased dramatically in recent years, but those alone do not justify a rent increase.
See our full Pricing Report available to all active listers.
Don’t pile on the fees
Vacationers often experience sticker shock when they see your initial rate and then learn that with an additional cleaning fee and the nearly 10-15% lodging tax, the ultimate price of your home is significantly higher than the rate posted on your calendar. If you have fees that apply to all bookings (such as cleaning), it might be best to incorporate them into your rental rate to avoid having such a great disparity between your listed rate and your final price.
The most common added fees are for cleaning, linens, and pets. Overall, 62% of homeowner listings have a cleaning fee. The other 38% include the turnover cleaning in the rental rate. Only 6% of listings have a linen fee, and 13% charge a pet fee.
Keep in mind that all non-refundable fees are taxable.
Fees for vacation rentals and breakdown by bedroom count.
Here are average cleaning fees by bedroom count:
Average cleaning fees by bedroom count.
What drives pricing?
Many factors contribute to the rental value of a home, including location, proximity to a beach or to water, bedroom count, air conditioning, and swimming pool.
Air conditioning
Homes with central air conditioning are on average 48% higher in price than those without air conditioning. Half of our homes have central air, while 12% have no air conditioning at all. Interestingly, the homes with a/c units do not seem to enjoy much of a price lift from those homes with no a/c at all. It appears that most vacationers are willing to pay more for central air but not for homes with units.
Swimming pools
Only 8% of our homes have a swimming pool. Because there are so few of them, they are priced 40% to 60% higher than those without a pool. Larger homes enjoy the largest price uplift.
Here are the most searched for amenities, along with the percentage of our listings that offer that amenity. As you can see, while “pets considered” is the number one searched for amenity, only 28% of our homes accept pets:
Most searched for vacation rental amenities.
Be mindful of the quality of your listing
Finally, we encourage you to take a look at your Listing Quality Audit (you’ll see a link to it in your Homeowner Center). Check your overall Listing Rating. If it’s less than “Excellent,” look at the items that need attention. Please contact us for some tips or suggestions. Our goal is to help you manage your rental property with a minimum of stress and a maximum of financial success!