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The Europe vacation rental market size is projected to grow by USD 60.18 billion, at a CAGR of 12.73% between 2022 and 2027. The expansion of the market hinges on several factors, notably the surge in tourist numbers across Europe, propelled by diverse attractions and cultural experiences. Additionally, the rapid adoption of online booking platforms for short-term rental properties amplifies market accessibility and convenience for travelers. Technological advancements in property booking, including user-friendly interfaces and secure payment systems, further catalyze market growth by enhancing the booking experience and expanding the reach of rental property owners. As a result, the European vacation rental market continues to thrive, offering a wide array of accommodation options and catering to the evolving preferences of travelers seeking memorable and convenient stays across the continent. This market report includes key market growth drivers, trends, and challenges during the forecasted period.
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The market is driven by various factors, including the increasing demand from B2C enterprises and the global consumer base seeking unique travel experiences. Demographic data, especially from the millennial generation, influences trends toward authentic experiences and luxury holidays. However, challenges such as travel restrictions and fluctuating consumer spending pose hurdles. Advanced forecasting methods like linear regression and Holt Winters forecast aid in understanding market dynamics. With the rise in apartment rental preferences, the market navigates through challenges while leveraging brand identity and appealing to families seeking memorable stays in Europe's bustling cities.
One of the significant driving factors behind the growth of the market is the technological advancements in property booking. There is a noticeable surge in investment by property owners in smart home devices aimed at simplifying and securing the short-term rentals and vacation rental process. For instance, nearly 70% of managers have already installed a Wi-Fi/ electronic lock on their properties, enhancing the experience for guests seeking luxury vacation homes and short-term rentals. The incorporation of advanced technology not only elevates security but also enhances convenience for guests in luxury within the European market.
This utilization of data analytics further augments the quality of services offered in luxury vacation homes and short-term rentals, catering to the evolving needs and preferences of customers. Luxury vacation rentals epitomize exclusivity, offering a level of opulence and sophistication that goes beyond typical accommodation options.
A key factor shaping the market growth in Europe is the improved booking process. One of the primary trends in the market is instant bookings. In addition, there has been significant upgradation in the technology of online booking sites to enable customers to book properties in real-time without having to wait for confirmation. As a result, it will make booking easier and more convenient and thereby enhance the booking process.
One of the significant players in the market, Airbnb Rentals, has implemented various initiatives aimed at enhancing the booking experience and addressing issues like discrimination on its online platform. The introduction of instant bookings by Airbnb rentals is a proactive measure intended to combat discrimination during the booking process. Moreover, within the market, mountainaire luxury cabins hold a distinctive appeal. These cabins, nestled in picturesque mountain settings, offer guests an immersive experience in nature coupled with luxurious amenities. The mountainaire luxury cabins demand for such unique and upscale accommodations has contributed to the overall growth of this sector in Europe.
Stringent regulation from various governments is one of the key challenges hindering market growth. There are several stringent regulations on homes enforced by various governments, which are significantly impacting the market. For instance, in 2016, the city council of Dublin ruled that the owners need to apply for permission for commercial use if they want to rent out the flat on a short-term basis. Luxury vacation rentals in Europe encounter several challenges with stringent regulations governing vacation rentals. Adhering to diverse legal frameworks, such as occupancy limits, tax laws, and zoning regulations, poses challenges for rental property owners. It faces stiff competition from established hotels offering premium services and amenities.
Moreover, the Iceland government has introduced a new law in which 1,600 Airbnb rentals will operate under stringent rules. Thus, such kinds of regulations enforced by the various governments in Europe are negatively impacting the market. Hence, it is expected to hinder the Europe market growth during the forecast period.
The market forecasting report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth and forecasting strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
9flats.com PTE Ltd: The company offers vacation rental that includes lease and rent short-term lodging.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
In the market, various factors shape the landscape, including the presence of B2C enterprises catering to the Global Consumer base. Demographic data and trends like Tourism spending and Consumer spending guide market strategies. Analytical methods such as Linear regression and Holt Winters forecast aid in forecasting demand. Targeting the millennial generation, offerings often focus on holidays for families, including those with children and pets. Adapting to travel restrictions, the market has evolved to offer luxury holidays and authentic experiences. Average price and brand identity influence choices, with options ranging from apartment rental in a bustling city to serene countryside retreats, reflecting the diverse preferences of European travellers.
The offline segment is estimated to witness significant growth during the forecast period. The traditional way of booking is the offline segment. There was a high popularity for the offline segment when Internet penetration was low. Even in today's era, there is an increasing preference for offline booking as some consumers lack faith in online reservations. In addition, the preference for offline booking is fuelled by the perception that the consumers get the best rate.
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The offline segment was the largest segment and was valued at USD 30.13 billion in 2017. There is a growing perception that customers are able to negotiate with the staff to get the best discounts if the mode of booking is offline. Even though the offline segment dominates the Europe market, there is a decline in preference for this mode of booking after the trend of online booking post-pandemic. As a result, the offline segment of the market is expected to grow moderately during the forecast period.
The management of vacation properties across Europe has seen significant evolution due to technological advancements and increased demand. Europe vacation property management services have adapted to leverage technology, data analytics, and customer-centric approaches to enhance the guest experience, optimize property performance, and ensure seamless operations. Therefore, the initiatives undertaken by platforms like Airbnb, the allure of mountainaire luxury cabins, and the evolution of Europe vacation property management collectively contribute to driving the growth of the market in Europe.
The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2023-2027, as well as historical data from 2017-2021 for the following segments.
The market is influenced by various factors, such as device penetration and GDP per capita, which impact price indices and exchange rates. With a thriving vacation rental sector, Europe offers diverse accommodation options ranging from rental condos to private residences in both urban and rural areas. High-speed internet and modern amenities like hot tubs and pools enhance guest experiences. Technology breakthroughs and regional expansion drive market growth, attracting smartphone users to browse listings on platforms like Vrbo. From Edinburgh to Athens, destinations offer a range of options, from quaint villas to luxurious villas. Campaign launches and strategic marketing efforts ensure long-term success in this dynamic market, catering to the needs of fashion enthusiasts, Baby Boomers, and Gen X travelers alike.
Market Scope |
|
Report Coverage |
Details |
Page number |
143 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 12.73% |
Market growth 2023-2027 |
USD 60.18 billion |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
17.41 |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
9flats.com PTE Ltd., Airbnb Inc., atraveo GmbH, Bennington Properties LLC, Bluefish Vacation Rentals, Booking Holdings Inc., Clickstay Ltd., Elite Destination Homes, Expedia Group Inc., Holiday Lettings, HomeToGo GmbH, Mi Kasa Tu Kasa Bacalar, Platinum Equity Advisors LLC, RedAwning.com Inc., Rental Escapes, Sonder Holdings Inc., TripAdvisor LLC, Vacasa Inc., World Travel Holdings, and Wyndham Destinations Inc. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period. |
Customization purview |
If our market growth analysis report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Mode of Booking
7 Market Segmentation by Management
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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