Throughout the year, Beyond Pricing has monitored local and national regulation on short term rental markets around the world and their effect on travel demand. This week, on the same day that the national lockdown was lifted in England, it was also announced that the United Kingdom had approved the COVID-19 vaccine. With vaccine availability starting as early as next week in Britain, short term rental owners and managers should prepare for a shift in consumer confidence regarding the future of travel.
National Lockdown Lifted
As a result of the national lockdown announcement in England in early November, rental properties saw an immediate decrease in booking pace. In the chart below, UK markets saw a 31% decrease in booking pace for Christmas week over week immediately after the announcement was made. Booking activity soon rebounded, however, as it was announced in late November that multiple households would be allowed to gather over the Christmas holiday between December 23rd and 27th. As of December 2nd, the national lockdown has been replaced with a flexible tier system that implements rules for each region of England based on the latest COVID-19 data. With such a direct correlation between government restrictions and booking activity, it is imperative that property managers act quickly and stay proactive with their pricing and distribution strategy over the next few months.
COVID-19 Vaccine Announcement
In addition to lifting the national lockdown this week, the UK also became the first western country to approve a COVID-19 vaccine for distribution. Distribution of the vaccine will begin next week, hopefully setting off the beginning of the end for the COVID-19 pandemic as we know it. Such an announcement surely has had an impact on travel consumer confidence throughout the UK as more travelers consider the possibility of a future holiday in 2021. While there is no clear indication of extreme pent-up demand flooding into UK markets for next year yet, it is expected that demand will only increase as vaccine distribution widens in the UK and around the world. Similar to the impact of the national lockdown on booking pace, property managers must stay up-to-date with the latest in their market to proactively manage their home inventory and revenue. This year has highlighted the importance of an efficient and proactive revenue management strategy, and Beyond Pricing is here to help with the tools and strategies to stay ahead of the curve.
Market Insights: What To Look For
Throughout the year, Beyond Pricing has highlighted key indicators that show how and when demand in a market is changing to help property managers get ahead with their strategy. As shown above, monitoring booking activity and average booking lead time at a market-level and within your own portfolio is the quickest way to pulse-check how a specific market is performing. A rise in booking activity around Christmas, for example, should prompt a property manager to consider raising their rates to meet current demand. Booking pace compared to previous years will be an important metric to watch heading into 2021, as an increase in vaccine distribution may fuel a surge of pent-up travel demand globally.
Another key indicator of a change in travel consumer confidence is cancellation rates, especially surrounding government restrictions regarding travel and lockdowns. An abnormal spike in cancellations for a market is a sure sign that guests have recently become uncomfortable with the idea of traveling and that property managers should adjust their pricing and distribution accordingly. As we learn more about vaccine developments and their impact on the travel industry, be sure to sign up for our email alerts for the latest.
Wondering how to keep up with this data? For current Beyond Pricing users, our Insights tool is now available to monitor these indicators at a market level. Insights is also currently available for free for any property owners and managers, just be sure to create a free account and easily connect your listings.