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Vacation Rental Market Size 2025-2029

The vacation rental market size is forecast to increase by USD 22 billion, at a CAGR of 4.1% between 2024 and 2029. The market is experiencing significant growth, fueled by the expanding tourism industry and the increasing preference for short-term stays.

Major Market Trends & Insights

Europe dominated the market and accounted for a 32% share in 2023.
The market is expected to grow significantly in North America region as well over the forecast period.
Based on the Management, the managed by owners segment led the market and was valued at USD 61.00 billion of the global revenue in 2023.
Based on the Method, the offline segment accounted for the largest market revenue share in 2023.

Market Size & Forecast

Market Opportunities: USD 98.00 Billion
Future Opportunities: USD 22 Billion
CAGR (2024-2029): 4.1%
Europe: Largest market in 2023

Marketing automation tools, rental income tracking, guest experience metrics, calendar synchronization, and host communication platforms facilitate effective marketing and guest engagement. Legal compliance standards, cleaning service scheduling, digital marketing strategies, online reputation management, booking platform integration, customer relationship management, multi-property management, and revenue management software are indispensable for managing a large and diverse rental portfolio. Prices for vacation rentals are expected to grow by 5% annually, driven by the increasing popularity of short-term rentals and the adoption of advanced technologies. The market is witnessing a shift towards automation and integration, with automated check-in/out, keyless entry systems, and data analytics dashboards becoming standard offerings.

What will be the Size of the Vacation Rental Market during the forecast period?

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The market continues to evolve, with innovative technologies and strategies shaping the industry landscape. Dynamic pricing algorithms are increasingly being adopted to optimize revenue based on real-time market demand and supply dynamics. For instance, a leading player in the market reported a 15% increase in average daily rate through dynamic pricing. Maintenance request systems, tax compliance software, and smart home integration are essential tools for property managers, ensuring efficient operations and regulatory compliance. Moreover, rental agreement templates, payment gateway security, and security camera monitoring enhance the guest experience and property protection. Insurance policy coverage, occupancy rate optimization, and channel management strategies are crucial components of a successful rental business. The professionally managed segment is the second largest segment of the management and was valued at USD 33.50 billion in 2023.

In conclusion, the market is characterized by continuous innovation and adaptation to meet the evolving needs of property managers and guests. By leveraging technologies such as dynamic pricing algorithms, maintenance request systems, tax compliance software, smart home integration, and more, rental businesses can optimize operations, enhance guest experiences, and grow their revenue.

The convenience of instant booking features has made vacation rentals an attractive alternative to traditional hotels, particularly for travelers seeking more personalized and affordable accommodations. However, this market is not without challenges. The rise of fraudulent vacation rental properties poses a significant risk to both renters and property owners. Malicious actors create fake listings or misrepresent existing properties, leading to dissatisfied customers and potential financial losses.

Companies operating in this market must prioritize security measures to mitigate these risks and maintain customer trust. By addressing these challenges and capitalizing on the growing demand for vacation rentals, businesses can effectively position themselves to thrive in this dynamic and evolving market.

How is this Vacation Rental Industry segmented?

The vacation rental industry research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in 'USD billion' for the period 2025-2029, as well as historical data from 2019-2023 for the following segments.

Management

  Managed by owners
  Professionally managed


Method

  Offline
  Online


Type

  Home
  Apartments
  Resort/Condominium
  Others


Geography

  North America

    US
    Canada


  Europe

    France
    Italy
    UK


  APAC

    China
    India
    Japan


  South America

    Brazil


  Rest of World (ROW)

By Management Insights

The managed by owners segment is estimated to witness significant growth during the forecast

Vacation rentals encompass a broad range of property types, catering to diverse target markets. Homes and apartments remain popular choices, offering a home-like experience with furnished accommodations and kitchen facilities. Resorts and condominiums provide a more luxurious experience, featuring amenities such as pools, fitness centers, and concierge services. Recent developments include: July 2022 Avantio was purchased by Planet, a provider of integrated financial services and global technology. A provider of software and services for managing vacation rentals, Avantio. has increased its market share in the hotel industry., December 2020 To boost tourism and the economy of Tampa Bay, Airbnb partnered with Visit Tampa and launched a collaborative campaign. In order to encourage tourism in Tampa Bay, Airbnb also launched a specialised page for social media that offers a variety of accommodations as well as outdoor activities.. Notable trends are: Rising tourism sector to drive the market growth.

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Europe Vacation Rental Market Size 2025-2029

The Europe vacation rental market size is forecast to increase by USD 239.8 billion at a CAGR of 27.3% between 2024 and 2029.

The market is experiencing significant growth, driven by the increasing number of tourists seeking unique and affordable accommodations. This trend is further fueled by effective promotional strategies employed by rental providers, enabling them to reach a wider audience. This trend is further fueled by effective promotional strategies adopted by vacation rental platforms and property managers, making it easier for travelers to discover and book unique and affordable properties through the use of travel technologies. 
Additionally, the integration of technology, such as smart homes and contactless check-ins, is becoming increasingly important to cater to the evolving needs of the modern traveler. However, inconsistency in providing quality vacation rental properties poses a challenge to market growth. To maintain competitiveness, rental providers must prioritize offering superior guest experiences and ensuring property standards are met. This market analysis report delves into these factors and more, providing insights to help stakeholders make informed decisions in the European vacation rental market.

What will be the Size of the Europe Vacation Rental Market During the Forecast Period?

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The market, a significant segment of the B2C enterprises within the tourism industry, has experienced strong growth in recent years. With increasing global tourism spending and consumer preferences shifting towards authentic experiences, vacation rentals have gained popularity over traditional lodging options like hotels. The market's expansion is driven by factors such as high internet penetration and device penetration, enabling seamless online booking and management. The millennial generation, known for their penchant for experiences over material possessions, contributes significantly to the market's growth. Families, including those with children and pets, also favor vacation rentals for their added space and convenience.
However, travel restrictions and economic factors can influence market dynamics. Luxury holidays represent a lucrative niche within the vacation rental market, catering to travelers seeking exclusivity and personalized experiences. The average price point for vacation rentals varies widely, depending on factors such as location, size, and amenities. Brand identity and apartment rental platforms have emerged as key differentiators, with some offering unique features and services to attract customers. Despite these trends, the vacation rental market remains subject to economic fluctuations and external factors, necessitating continuous market analysis using tools like linear regression to inform strategic decision-making.

How is this Europe Vacation Rental market segmented and which is the largest segment?

The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in 'USD billion' for the period 2025-2029, as well as historical data from 2019-2023 for the following segments.

Mode Of Booking

  Offline
  Online


Management

  Managed by owners
  Professionally managed


End-user

  Leisure
  Business
  Group


Geography

  Europe

    UK
    France
    Italy
    Spain

By Mode Of Booking Insights

The offline segment is estimated to witness significant growth during the forecast period.

Offline booking is a traditional way of booking vacation rentals. Offline booking was very popular when internet penetration was not high. Word of mouth and repeat business were the most powerful triggers for offline bookings. In today's era, some people are still hesitant to book their accommodations online. The main cause for this is believed to be people's lack of faith in online reservations. Another reason people choose to book hotels offline is to ensure that they get the best rate. People usually think that by booking hotels offline, they will be able to negotiate with the staff or get extra discounts. However, this is not always the case, as most hotels do not offer discounts for booking offline. Numerous people also believe that booking hotels offline is easier than doing so online.

Further, offline booking held the largest market share in 2022, and the growth rate of the offline segment is decreasing continuously as offline booking is now fading away after the trend of online booking post-pandemic. The market share of the offline booking segment will continue to decline during the forecast period. Therefore, the offline segment in the vacation rental market in Europe is anticipated to grow moderately during the forecast period. The European vacation rental market is thriving, with tourism spending and apartment rental on the rise. Apartment rentals are increasingly

Market Snapshot

Attribute	Details
Current Market Size (2024A)	USD 101 Billion
Estimated Market Size (2025E)	USD 108 Billion
Projected Market Size (2035F)	USD 278 Billion
Value CAGR (2025 to 2035)	9.8%
Market Share of Top 10 Players	~55% (2024)

Country-Wise Vacation Rental Stays - 2024 Booking Volume

Country	Vacation Rental Guests (2024)
United States	72 Million
France	54 Million
Italy	48 Million
Japan	43 Million
Australia	39 Million
Canada	36 Million
Germany	32 Million
Brazil	28 Million
India	25 Million
South Korea	23 Million

The vacation rental market, currently valued at $98.87 billion in 2025, is experiencing robust growth, projected to maintain a 4.1% CAGR from 2025 to 2033. This expansion is driven by several key factors. The increasing popularity of experiential travel, a preference for flexible accommodations, and the rising adoption of online booking platforms are significantly boosting market demand. Furthermore, the diversification of rental offerings, encompassing everything from budget-friendly apartments to luxury villas, caters to a broader range of travelers' preferences and budgets. The market is segmented by management type (owner-managed vs. professionally managed) and booking method (online vs. offline), with online bookings showing a dominant and rapidly growing share. Strong growth is observed across all regions, particularly in North America and Europe, fueled by a surge in domestic and international tourism. However, factors such as fluctuating travel regulations, economic uncertainties, and seasonality can influence market performance. The competitive landscape is characterized by a mix of established players like Expedia Group and Airbnb, alongside numerous smaller, localized operators. These companies are employing various strategies including technological advancements, strategic partnerships, and enhanced customer service to maintain their market positions. The forecast period (2025-2033) anticipates continued growth, driven by ongoing technological advancements within the vacation rental industry, such as improved search functionalities, AI-powered pricing optimization, and enhanced customer relationship management tools. The increasing use of mobile applications for booking and managing rentals also contributes to this positive outlook. While regulatory changes and economic conditions pose potential challenges, the overall trend points towards a consistently expanding market fueled by changing consumer preferences and the ongoing digitalization of travel planning and booking. The strategic diversification of offerings and the entrance of new players are expected to further invigorate the market, while competition will continue to drive innovation and efficiency.

The size of the Vacation Rental Market was valued at USD 95.66 billion in 2023 and is projected to reach USD 123.36 billion by 2032, with an expected CAGR of 3.7 % during the forecast period. The vacation rental market has appreciated over the years, driven by growing demand for alternative accommodations and the rise of platforms such as Airbnb, Vrbo, and Booking.com. Vacation rentals are designed to provide travelers with more personalized and flexible and cost-effective options beyond what traditional hotels can offer when it comes to experiencing unique experiences in areas ranging from city apartments to remote cabins. This trend is mainly driven by a desire for more space, more privacy, and the ability to live like a local while traveling. Furthermore, the COVID-19 pandemic had accelerated the change toward vacation rentals, as travelers preferred private accommodations over crowded hotels for safety. Owner-to-owner vacation rental properties, residential and commercial in nature, continue to capitalize on this demand to offer well-updated homes fully equipped with services in houses, pools, and outdoor sitting areas. Continued growth in popularity of remote working and digital nomadism leads to the rise of the rental market for continued flexible lodging among travelers around the world. Recent developments include: In August 2022, Oravel Stays Private Limited bought Bornholmske Feriehuse, an operator of vacation rentals to expand its presence in Europe. The acquisition aimed to increase Oyo's presence in Croatia, where it had over 7,000 houses on its Traum Ferienwohnungen platform and close to 1,800 vacation homes on its Belvilla platform , In May 2023, in honor of Global Accessibility Awareness Day, Airbnb, Inc. stated that its agents had checked and verified the accuracy of approximately 300,000 accessible elements in residences globally. These accessibility features included step-free entrances, fixed grab bars, or bath or shower chairs .

Report Attribute/Metric	Details
Market Value in 2025	USD 6.1 billion
Revenue Forecast in 2034	USD 10.4 billion
Growth Rate	CAGR of 6.2% from 2025 to 2034
Base Year for Estimation	2024
Industry Revenue 2024	5.7 billion
Growth Opportunity	USD 4.7 billion
Historical Data	2019 - 2023
Forecast Period	2025 - 2034
Market Size Units	Market Revenue in USD billion and Industry Statistics
Market Size 2024	5.7 billion USD
Market Size 2027	6.8 billion USD
Market Size 2029	7.7 billion USD
Market Size 2030	8.2 billion USD
Market Size 2034	10.4 billion USD
Market Size 2035	11.0 billion USD
Report Coverage	Market Size for past 5 years and forecast for future 10 years, Competitive Analysis & Company Market Share, Strategic Insights & trends
Segments Covered	Property Type, Pricing Tier, Length of Stay, User Demographics
Regional Scope	North America, Europe, Asia Pacific, Latin America and Middle East & Africa
Country Scope	U.S., Canada, Mexico, UK, Germany, France, Italy, Spain, China, India, Japan, South Korea, Brazil, Mexico, Argentina, Saudi Arabia, UAE and South Africa
Top 5 Major Countries and Expected CAGR Forecast	U.S., France, Italy, Spain, UK - Expected CAGR 4.0% - 6.0% (2025 - 2034)
Top 3 Emerging Countries and Expected Forecast	Vietnam, Morocco, Colombia - Expected Forecast CAGR 7.1% - 8.6% (2025 - 2034)
Top 2 Opportunistic Market Segments	Estates and Penthouses Property Type
Top 2 Industry Transitions	Digitalization Amplifies Customer Experience, Rise of Eco-Luxury Rentals
Companies Profiled	Airbnb Luxe, Booking.com, Expedia, Villas of Distinction, Luxury Retreats, HomeAway, Vacasa, Turnkey Vacation Rentals, James Villa Holidays, Zillow, Vrbo and RedAwning
Customization	Free customization at segment, region, or country scope and direct contact with report analyst team for 10 to 20 working hours for any additional niche requirement (10% of report value)

Snapshot img

Short Term Vacation Rental Market Size 2025-2029

The short term vacation rental market size is forecast to increase by USD 114.1 billion, at a CAGR of 13.5% between 2024 and 2029.

The market is experiencing significant growth, driven by the expanding tourism industry and the increasing popularity of alternative accommodation options. Travelers seek flexibility, convenience, and unique experiences, making short term rentals an attractive choice over traditional and boutique hotels. Technological advancements further enhance the market's appeal, with digital platforms simplifying the booking process and offering personalized recommendations based on traveler preferences. However, the market faces challenges in ensuring consistent quality across vacation rental properties. The lack of standardization and regulation can lead to inconsistencies in the guest experience, potentially impacting customer satisfaction and brand reputation.
Addressing this challenge requires a commitment to quality assurance, from property maintenance and cleanliness to guest communication and support. Companies that prioritize these aspects and leverage technology to streamline operations will capitalize on the market's opportunities while navigating challenges effectively.

What will be the Size of the Short Term Vacation Rental Market during the forecast period?

Explore in-depth regional segment analysis with market size data - historical 2019-2023 and forecasts 2025-2029 - in the full report.
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The short-term rental market continues to evolve, with dynamic pricing strategies shaping the landscape. Property managers employ guest management systems to optimize operations, while digital marketing and channel management tools expand reach. Email marketing and social media platforms engage guests, driving direct bookings. Property valuation relies on data analysis, including occupancy rates and revenue management. Seasonal demand influences pricing, with peak seasons offering higher yields. Energy efficiency and green initiatives attract eco-conscious travelers, while luxury rentals cater to affluent guests.

Amenities, from smart home technology to concierge services, enhance the guest experience. Calendar synchronization ensures seamless booking and maintenance services maintain property condition. Legal compliance remains crucial, with security systems and yield management tools addressing safety and revenue optimization. Budget rentals and cabin rentals cater to diverse markets, expanding the market's reach. Overall, the short-term rental market's continuous evolution reflects the industry's adaptability and innovation.

How is this Short Term Vacation Rental Industry segmented?

The short term vacation rental industry research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in 'USD billion' for the period 2025-2029, as well as historical data from 2019-2023 for the following segments.

Mode Of Booking

  Offline
  Online


Management

  Managed by owners
  Professionally managed


Type

  Apartments and condominiums
  Villas and luxury homes
  Cottages and cabins
  Resorts and bungalows
  Others


Location

  Urban
  Rural
  Coastal
  Mountain


Traveler Type

  Leisure Travelers
  Business Travelers
  Families


Geography

  North America

    US
    Canada


  Europe

    France
    Germany
    Italy
    The Netherlands
    UK


  APAC

    China
    Japan


  Rest of World (ROW)

By Mode Of Booking Insights

The offline segment is estimated to witness significant growth during the forecast period.

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The Offline segment was valued at USD 87.10 billion in 2019 and showed a gradual increase during the forecast period.

Regional Analysis

Europe is estimated to contribute 32% to the growth of the global market during the forecast period.Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.

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The European the market is experiencing growth due to the rising demand for travel and unique experiences. Travelers seek more personalized accommodations, leading to the popularity of short term rentals over traditional hotels. Weekend getaways and city breaks align with the trend of experiential travel, further fueling market growth. Short term rentals offer flexible options and can be cost-effective for families or groups. Pricing strategies, such as dynamic pricing and seasonal demand, influence rental income. Guest management systems, email marketing, and channel management help optimize bookings. Operating expenses include cleaning services, maintenance, and property management software. Energy efficiency and green initiatives are essential property amenities.

Smart home technology enhances the guest experience, while calendar synchroniz

The market is projected to surpass USD 4,00,911.98 Million by 2035, growing at a CAGR of 10.4% during the forecast period.

Metric	Value
Market Size in 2025	USD 1,49,059.03 Million
Projected Market Size in 2035	USD 4,00,911.98 Million
CAGR (2025 to 2035)	10.4%

Country-wise Outlook

Country	CAGR (2025 to 2035)
United States	10.5%

Country	CAGR (2025 to 2035)
United Kingdom	10.3%

Country	CAGR (2025 to 2035)
European Union	10.4%

Country	CAGR (2025 to 2035)
South Korea	10.6%

Segmentation Outlook

Accommodation Type	Market Share (2025)
Apartments	42.5%

Booking Mode	Market Share (2025)
Online/Platform-based	76.3%

Company Name	Estimated Market Share (%)
Airbnb Inc.	30-35%
Booking Holdings Inc.	20-25%
Expedia Group ( Vrbo )	15-20%
TripAdvisor ( FlipKey )	5-9%
Sonder Holdings Inc.	3-7%
Other Companies (combined)	15-25%

Competitive Outlook

The size of the Short-term Vacation Rental Market was valued at USD 121.42 billion in 2023 and is projected to reach USD 255.28 billion by 2032, with an expected CAGR of 11.2 % during the forecast period. Short-term vacation rentals are properties rented out for a short period of time, often for several days to a few weeks. Travelers are often looking for a more personal, budget-friendly, and flexible stay than a typical hotel can provide. This is where short-term vacation rentals come in, with properties ranging from apartments and houses to unique offerings like cabins or beachfront villas, listed on sites like Airbnb and Vrbo. Vacation rental owners fully furnish spaces equipped with kitchens, Wi-Fi, and laundry facilities, making them feel like a home. Demand for authentic experiences, cost savings, and the convenience of staying in a residential area are some of the reasons why the market has exploded. Short-term rentals have also opened a source of side income for homeowners who can earn money by letting out their house or even their spare rooms. However, the industry faces regulatory challenges in some regions as local governments seek to balance growth with zoning and housing concerns.

The vacation rental market is experiencing robust growth, driven by increasing disposable incomes, a preference for unique travel experiences, and the rise of the sharing economy. The market's expansion is fueled by several key trends: the increasing popularity of alternative accommodations beyond traditional hotels, the growing adoption of online booking platforms, and the diversification of rental options, ranging from apartments and private homes to unique properties like villas and cabins. Technological advancements, such as improved search functionalities and mobile booking apps, are further enhancing accessibility and convenience for travelers. While factors like fluctuating travel restrictions and economic downturns can pose challenges, the market's inherent resilience and the continued demand for flexible and personalized travel experiences suggest a positive long-term outlook. The segmentation within the market indicates strong performance across various applications, including the travel industry and commercial sectors, with apartment and private home rentals holding significant market share. Major players like Airbnb, Booking Holdings, and Expedia are key contributors to market growth, constantly innovating to attract and retain customers. Geographic data indicates North America and Europe as major revenue generators, although Asia Pacific and other regions are showing significant growth potential. The forecast period (2025-2033) suggests continued expansion, driven by consistent demand and technological enhancements. Competition is fierce but opportunities abound for established players and new entrants alike who can effectively leverage technology and cater to evolving traveler preferences. The competitive landscape is dynamic, with established players like Airbnb and Booking Holdings continuously innovating their platforms and services to remain competitive. New entrants are also emerging, leveraging technological advancements and specialized offerings to carve out niche markets. However, regulatory challenges, particularly concerning licensing and taxation, represent a significant restraint for the industry. Maintaining sustainable practices and addressing environmental concerns are also becoming increasingly important. Despite these challenges, the long-term growth trajectory for the vacation rental market remains optimistic, propelled by persistent demand for unique and personalized travel experiences, and the ongoing evolution of technology within the hospitality sector. Data suggests that this market will experience significant growth across all regions, with some exhibiting faster growth rates than others. Understanding the nuances of regional demand and preferences will be crucial for success in this dynamic market.

The vacation rental market, valued at $86.12 billion in 2025, is experiencing robust growth, projected to expand at a compound annual growth rate (CAGR) of 25.79% from 2025 to 2033. This surge is driven by several factors. The increasing popularity of experiential travel, coupled with a rising preference for flexible and personalized accommodations over traditional hotels, significantly fuels market expansion. Technological advancements, particularly in online booking platforms and property management software, streamline the booking process and enhance customer experience, further propelling growth. The rise of remote work also contributes, as individuals seek extended stays in vacation destinations, blurring the lines between work and leisure. Market segmentation reveals a significant split between online and offline bookings, with online platforms dominating due to their convenience and wider reach. Similarly, professionally managed properties are gaining traction over owner-managed ones, reflecting a growing demand for reliable service and consistent quality. Competition among major players like Airbnb, Booking Holdings, and Expedia Group is fierce, prompting ongoing innovation and strategic partnerships to attract and retain market share. However, certain restraints impact market growth. Economic fluctuations and global events can significantly affect travel patterns and consumer spending on leisure activities. Regulations concerning short-term rentals, varying across different regions and jurisdictions, pose challenges for operators. Maintaining property standards and ensuring guest safety remain critical operational concerns, requiring continuous investment in technology and service enhancements. The analysis of leading companies, their market positioning, and competitive strategies within the specified regions (Europe: UK, France, Italy, Spain) reveals a dynamic landscape shaped by innovative marketing, targeted customer acquisition, and diversification of offerings. Addressing these challenges strategically, while leveraging technological advancements and shifting consumer preferences, will be crucial for sustained success in this burgeoning market.

The Vacation Rental Website Market is estimated to be valued at USD 2.3 billion in 2025 and is projected to reach USD 7.3 billion by 2035, registering a compound annual growth rate (CAGR) of 12.1% over the forecast period.

Metric	Value
Industry Size (2025E)	USD 2.3 billion
Industry Value (2035F)	USD 7.3 billion
CAGR (2025 to 2035)	12.1%

The Europe Vacation Rental Market size was valued at USD 32.65 billion in 2023 and is projected to reach USD 40.16 billion by 2032, exhibiting a CAGR of 3.0 % during the forecasts period. The Europe Vacation Rental market is the rental service that provides private detached residences in the form of Apartments, Houses, Villas, and Cottages to travelers on a short-term basis. These rent for holidays basically through the Internet and are a plus to traditional accommodations as they are cheaper, roomier, and quite flexible during vacation time. Some of the uses of vacation rentals include but are not limited to leisure travel, family traveling, group traveling, and even business traveling. Future trends include more management companies dealing with vacation rentals, more rural areas and off-the-beaten-path locations, and the handling of properties in an environmentally friendly way with an emphasis on recycling, energy efficiency, and the use of green materials. There are personal changes in the travelers who prefer to make bookings through convenient channels and the need to travel to seek novelty and engage in experiential tourism. Recent developments include: In December 2020, Hotels.com, an Expedia Group, Inc. company, was labeled as the official traveling partner of the NBA. The contract will enable Hotel.com to communicate with NBA fans and travelers through cohesive marketing efforts, which will demonstrate that using Hotel.com is the most benefitting way to reserve accommodations. , In December 2020, Tripadvisor announced the unveiling of its new trip designing platform called Reco. The platform provides tailor-made itineraries to travelers, which features highlights of destinations in over 100 countries. Reco entails the expertise of over 300 trip designers. .

Global Vacation Rental Market was valued at USD 83.87 billion in 2023 and is anticipated to project robust growth in the forecast period with a CAGR of 4.89% through 2029.

Pages	185
Market Size	2023: USD 83.87 Billion
Forecast Market Size	2029: USD 111.32 Billion
CAGR	2024-2029: 4.89%
Fastest Growing Segment	Resort/Condominium
Largest Market	Europe
Key Players	1. Hotelplan Group 2. MakeMyTrip (India) Private Limited 3. Awaze A/S (NOVASOL) 4. Airbnb, Inc. 5. Booking Holdings Inc. 6. Expedia, Inc. 7. Belvilla AG 8. Sonder Holdings Inc. 9. Plu&m Limited 10. Wyndham Destinations Inc.

Vacation Rental Market Outlook

The global vacation rental market size was valued at USD 87.09 billion in 2023, and it is projected to reach USD 144.02 billion by 2032, growing at a CAGR of 5.8% during the forecast period. The market is experiencing significant growth due to increasing awareness and preference for personalized, flexible, and affordable accommodation options among travelers. This surge in preference for alternative lodging options over traditional hotels is being driven by the rise of online platforms facilitating easy and transparent booking processes.

One of the primary growth factors for the vacation rental market is the increasing penetration of the internet and the widespread adoption of smartphones. The digital revolution has greatly influenced the way travelers plan their trips, offering them the convenience of comparing various accommodation options and prices at their fingertips. Additionally, the growth of social media and online reviews has enhanced trust and reliability, making it easier for travelers to book vacation rentals with confidence.

Another significant growth driver is the rising trend of experiential travel, wherein travelers seek unique and personalized experiences that reflect local culture and lifestyle. Vacation rentals often provide a home-like environment and the opportunity to live like a local, which is highly appealing to modern travelers, especially millennials and Gen Z. This shift in consumer preferences is encouraging property owners and managers to invest in the vacation rental market, thereby expanding the supply of diverse accommodation options.

Economic factors such as competitive pricing and cost-effectiveness compared to traditional hotel stays are also contributing to the market's growth. Vacation rentals often offer more space, privacy, and amenities at a lower cost per person, making them an attractive option for group travel and families. Moreover, the additional income potential for property owners and the relatively low barriers to entry are motivating more individuals to list their properties on vacation rental platforms, further driving market expansion.

The regional outlook highlights that North America and Europe dominate the vacation rental market due to the high adoption of digital booking platforms and a well-established tourism infrastructure. However, emerging markets in the Asia Pacific and Latin America are witnessing rapid growth driven by increasing disposable incomes, a growing middle class, and expanding tourism sectors. The Middle East & Africa region is also expected to see steady growth, particularly with the rising number of international events and investments in tourism infrastructure.

Accommodation Type Analysis

Apartments hold a significant share in the vacation rental market, primarily due to their widespread availability and cost-effectiveness. Apartments cater to a broad audience, including solo travelers, couples, and small families, offering a comfortable and flexible living space. Urban centers, which attract a large number of tourists, particularly benefit from the availability of apartment rentals, providing visitors with the option to stay in the heart of the city at competitive prices. The rise of business travel is also contributing to the demand for apartments, as they often provide the necessary amenities for a comfortable and productive stay.

Houses are another critical segment within the vacation rental market. They are especially popular among larger groups and families who require more space and privacy than what apartments typically offer. Houses often come with additional features such as gardens, pools, and multiple bedrooms, making them ideal for extended stays and family vacations. This segment is seeing increased demand in suburban and rural areas, where travelers seek a peaceful retreat away from the hustle and bustle of city life.

Villas represent the luxury segment of the vacation rental market, providing high-end accommodations with premium amenities and services. Villas are particularly popular in tourist destinations known for their scenic beauty and luxury tourism, such as coastal areas and exotic islands. The demand for villas is driven by affluent travelers seeking exclusive and indulgent experiences. This segment continues to grow as more property owners and developers invest in building and maintaining high-quality vill

The global short-term rental market size was over USD 125.22 billion in 2024 and is anticipated to witness a CAGR of around 10.9%, crossing USD 480.6 billion revenue by 2037. Online/Platform-based segment is expected to reach 65.5% industry share, fueled by ease of booking, secure payments, and AI-based recommendations.

The short-term vacation rental (STR) market is experiencing robust growth, driven by several key factors. The increasing popularity of experiential travel, coupled with the desire for more personalized and flexible accommodations compared to traditional hotels, fuels demand. Technological advancements, particularly the rise of online booking platforms like Airbnb and Booking.com, have significantly lowered entry barriers for both hosts and renters, further expanding the market. The diverse range of rental options, from cozy apartments for weekend getaways to spacious villas for extended family vacations, caters to a broad spectrum of traveler needs. Furthermore, the shift towards remote work and digital nomadism has contributed to a rise in longer-term stays, creating new revenue streams for property owners. We estimate the 2025 market size at $500 billion, reflecting a strong CAGR of 10% from 2019 to 2025. Segment-wise, 3-8 day tourist rentals represent the largest portion of the market due to their appeal to both leisure and business travelers seeking mid-length stays. Despite its considerable growth, the STR market faces certain challenges. Regulation and taxation remain key concerns in many regions, with differing legal frameworks influencing property owners' ability to operate legally and sustainably. Seasonal fluctuations in demand can lead to revenue instability for hosts, particularly in locations heavily reliant on tourism. The increasing competition among numerous players, both established platforms and independent hosts, necessitates strong marketing and differentiation strategies for success. Despite these headwinds, the long-term outlook for the STR market remains positive, with continued growth expected throughout the forecast period (2025-2033). We project a steady expansion, driven by evolving traveler preferences and ongoing technological innovations in booking and property management. Factors such as increased focus on sustainable travel and the rise of niche platforms will continue to shape the market landscape in the coming years.

Global vacation rental market size was worth around USD 92.93 billion in 2023 and is to grow to around USD 129.99 billion by 2032, (CAGR) of 3.80% between 2024 and 2032

The global vacation rental market was valued at USD 95.07 billion in 2024 and is projected to surpass USD 137.88 billion by 2034, growing at a CAGR of 3.85%.