Coronavirus – Villa Experience’s Guide for Vacation Rental Owners & Agents
By now we all know, the recent COVID-19 (Coronavirus) has led to a great deal of disruption and uncertainty all across the globe. Our first priority is, of course, the health and well-being of all of our customers, the VillaExperience team, business partners and their families, and our thoughts go out to those affected. In terms of business, the luxury vacation rental industry has been one of the hardest hit, with guests traveling to and from affected areas canceling bookings and property owners or managers in many places facing an unpredictable season. We know that many property owners are concerned about the medium and long-term impact the present situation may have on their destination.
We understand that this is a difficult time for all of us; property managers, owners, hosts and travelers, who are all looking for the latest information on how the Coronavirus affects the vacation rental industry. We’ve put together a short guide containing some key information vacation rental industry professionals need to be aware of concerning the Coronavirus. We hope this can help provide some clarity and stability at this uncertain time.
The long-term impact of Coronavirus on tourism and short-term rental industry
Due to the ongoing and evolving nature of the situation, it is, of course, difficult to predict exactly what is going to happen next. However, we can look to similarities with other crises in the past as well as early trends around the COVID-19 outbreak to assess likely outcomes. The first thing to keep in mind is that the travel sector, in general, is surprisingly resilient. The industry has rebounded from similar incidents in the past and has maintained steady growth throughout the years. Indeed, in many areas, the industry is still seeing year-on-year growth compared to this time in 2019, albeit lower than forecast. Whilst this is currently a very challenging time for rental managers in many places, it is unlikely that the present outbreak will drastically alter the ongoing megatrend.
How to adapt your business for the Coronavirus
Many property owners & managers will be looking for ways to ensure their business remains stable and are finding opportunities within the challenge. Given how dynamic and fast-changing the situation is, the key advice for property owners and managers in this critical time is to be flexible. There will be more last-minute decision-making from guests and other parties such as airlines and local authorities, so the ability to adapt will be crucial. Even if you feel that your destination or property is unlikely to be affected it is still important to remain mindful of guests’ concerns and to allow them the flexibility to rearrange their trips if that is required to give them peace of mind.
Your relationship with guests is key. Continue to build trust and loyalty with your upcoming and previous customers by reaching out to them. We recommend proactively advocating the message that private rentals are more private and therefore less risky than hotels, and emphasizing any additional cleaning or other precautions you have put in place in order to ease their concerns.
Additionally, if you are a Property Manager or Agent, your relationship with owners is also critical. Proactively managing their expectations, and explaining the things that you are doing to ensure you are ready for a recovery in demand will reduce stress and panic.
You should also adjust your pricing now.
- We recommend setting lower Basic rates until the end of 2020.
- Use our Last Minute discount to provide discounts for those planning travel at short notice (recommend to offer a discount for bookings up to 1 or 2 months before check-in). While summer 2020 in the northern hemisphere is likely to be depressed, our feeling is that guests will be making last-minute decisions on summer vacations.
- If you have set High Season rates for the winter, you should review those and be prepared to offer lower rates during 2020.
While this may significantly change your earnings, this strategy is to ensure you are at the front of the curve when demand picks up. You can update your pricing as soon as you see a recovery in demand, but remember you are competing for guest nights with others, so you must keep an eye on local competitor pricing.
Many property managers are seeing a reduction in their bookings, but are still being forced to pay high fixed costs on other platforms. Unlike other software providers, we don’t charge any subscription or monthly fees, so you only pay when you receive a booking. We do not work on a subscription-based model. Instead, we operate on a commission-based model that is taken out of the bookings we secure for you.