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A vacation rental is the renting out of a furnished apartment, house, or professionally managed resort-condominium complex on a temporary basis to tourists as an alternative to a hotel. The term vacation rental is mainly used in the US. In Europe the term villa rental or villa holiday is preferred for rentals of detached houses in warm climates. Other terms used are self-catering rentals, holiday homes, holiday lets (in the United Kingdom), cottage holidays (for rentals of smaller accommodation in rural locations) and gites (in rural locations in France).

Vacation rentals have long been a popular travel option in Europe (especially in the UK) as well as in Canada and are becoming increasingly popular across the world.


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Types of accommodation

Vacation rentals usually occur in privately owned vacation properties (holiday homes), so the variety of accommodation is broad and inconsistent. The property is a fully furnished property, such as a holiday villa, apartment, cottage, condominium, townhome or single-family-style home. Farm stay can encompass participation on a working farm, or a more conventional rental that happens to be co-located on a farm. The client/traveler arranges to rent the vacation rental property for a designated period of time. Some rent on nightly basis similar to hotel rooms, although the more prevalent vacation rental industry practice is typically weekly rentals.

Vacation rentals can range from budget studio apartments to lavish, expensive private villas in the world's most desirable locations, some with pricetags of many thousands per night and all the amenities you would find in any luxury accommodation (fully staffed, private beaches, boats, chefs, cooking lessons, etc.) to cater to the guests.

Some vacation rentals, particularly condominiums or apartments, offer many of the same services hotels offer to their guests, e.g., front desk check-in, 24-hour maintenance, in-house housekeeping, and concierge service. Many "hospitality, timeshare and premier independent resorts...that until now, access to these resort-condominium complexes was available exclusively through purchase options such as whole, fractional, or timeshare ownership," are now offering daily vacation rentals.

At the other end of the spectrum are campervan and motorhome rentals.


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Locations

Villa holidays are very popular in Europe, and main destinations include United States Virgin Islands, Italy, Spain, France, Germany, Greece, and Turkey. In France, they are known as gîtes.

Vacation rentals are available in most states of the US and is prevalent in major tourist areas such as Florida, Hawaii and California, as well as in other coastal areas with beaches, where they may be referred to as beach houses, many of which are rentals. The vacation rental market is much larger in Europe than it is in the United States, and Florida is a popular destination for villa holidays for Europeans.


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Comparison with other accommodations

Consumers unfamiliar with the concept of a vacation rental may confuse it with the seemingly similar, but distinctly different, timeshare. Many timeshare resorts offer quarter ownership, which provides 13 weeks of use or rental.

A timeshare can still be made available as a vacation rental should an owner decide to put his owned week(s) on a vacation rental program. Also, a large segment of the 21% of unsold and therefore still resort-controlled inventory is made available as vacation rentals. In 2014, this was a $1.9 billion business.

A timeshare is a piece of real estate--often a fully furnished condominium--that is jointly shared by multiple owners. While different types of timeshare ownerships exist, in general, each owner bears a portion of the responsibility, along with the right to a segment of time in which he or she is granted sole use of the property. Timeshare resorts allow financially qualified guests to rent and tour their unowned properties and then make those properties available to the guest for purchase. Timeshare owners can also choose to bank their week with an exchange company such as RCI or Interval International, or rent the unit.

Traditional hotels generally do not include vacation properties. However, some contemporary resort developments include shared ownership components such as villas and condominiums that can be either rented through the hotel or rented out by their owners either directly or through agencies.


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Vacation rental market size

Evercore estimates the global addressable vacation rental market to be $100 billion, with two-thirds of the market "for rent by owner".


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Online, listing services, agencies and management companies

Vacation rentals and villa rentals are arranged either direct with the owner or through an agency, usually via the internet. Many owners have their own websites, but most also use listing services, which display property information and photos provided by the homeowner. Because each property owner has his or her own deposit and payment requirements, cancellation policies, key-pick-up procedures, etc., a guest contacts the property owner directly in order to book.

There are different kinds of listing sites, with different specialisms (for example, destination-specific, luxury, rural, etc.) and features (such as instant booking or loyalty programs).

In November 2015, Expedia bought HomeAway (which also owns VRBO and many other vacation rental brands) to compete with Airbnb and Tripz.com.

There are also other online vacation rental sites that specialize in metasearch or resort residences.

In contrast vacation rental agencies handle reservations and billing on the homeowner's behalf, and there is no direct contact between the guest and the owner. Because the fee or commission charged to an owner by an agency is higher than that charged by a listing service, the rent tends to be higher.

There are also many management companies that organize all aspects of the rental on behalf of the owner, including property management, repairs service, keyholding and cleaning services, OneFineStay in a number of European cities and Interhome in many European leisure resorts are two of the best known.

In the United Kingdom villa holidays are also sold by tour operators as packages including flights and car hire. This is convenient for guests who prefer not to make their own arrangements, but may not be cheaper and does not usually allow the guest to choose a specific property.

Most property owners contract a vacation rental management company to manage their vacation rentals. These companies handle housekeeping and property maintenance. Some management companies also act as agencies, marketing the vacation rental property, and handling reservations and billing. Most vacation rental management companies work on a commission basis, meaning they do not make a guarantee to the homeowner in terms of weeks that will be rented or revenue earned. Rather, they collect a commission ranging from 20% to 50% of any revenues generated.

An alternative arrangement is where vacation rental managers provide homeowners with a guaranteed rental. Under these arrangements vacation rental managers buy all of the weeks the homeowner wishes to rent in a single transaction. This provides the homeowner with guaranteed income, and puts the risk and management burden on the rental manager.


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Travelers' concerns

Some travelers avoid vacation rentals for fear of what industry insiders call SNAD: "Significantly Not As Described". This refers to a property that looks like paradise in the photos, only to reveal leaky roofs and blocked views upon the traveler's arrival. To reduce this risk, many vacation rental companies offer user reviews.

Another significant concern is that people may create false accounts, and advertise vacation homes which they do not in fact own. This can lead to unsuspecting customers' booking and paying for a vacation, only to find on arrival that the rental does not exist. Given that the accommodation has been booked and paid for many months in advance, the culprit may disappear without trace, leaving the customer out of pocket.


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Restrictions

In many counties, towns and cities local authorities attempt to regulate or ban vacation rentals after complaints from local residents or competing lodging businesses. In the U.S. New York City, Chicago and other cities have introduced restrictions on short term rentals, though regulation is not always strictly enforced. The City of Portland, for example, does not allow rentals of less than 30 days in residential zones but according to local vacation property managers such as Vacasa, the average guest stays 3-10 nights.

In most US cities and counties, zoning ordinances prohibit any type of lodging business in areas zoned for residential use. In some areas, zoning allows limited lodging uses provided that they are secondary to the primary residential use of the property.

Source of the article : Wikipedia



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