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Holiday Rental Property - UK - June 2016

“The holiday rental property corporate landscape saw further change during 2015 and into 2016 as major industry players jockeyed for position. The scramble for scale among these companies is not unconnected with the continued surge in usage of industry disrupter Airbnb. The company now offers substantially more rental properties around the world than any other player in the market.”

– Michael Oliver, Senior Leisure and Media Analyst

This report looks at the following areas:

  • What does the growing influence of TripAdvisor mean for the industry?
  • How can owners and agents optimise the appeal of rental properties?

After several difficult years, the holiday rental property market saw strong growth in 2015. Factors driving this growth have included lower oil prices (which have fed through in the form of reduced air fares and cheaper petrol), growth in the UK economy and the improved financial situation of many consumers.

Looking ahead, headwinds may emerge in terms of a weaker Pound, depending on the outcome of the EU referendum, while the overseas market is also being affected by rebalancing on the part of airlines towards old favourite resorts in the Western Mediterranean which are seen as safer in the wake of a run of terrorist attacks targeting tourists in countries including Turkey, Tunisia and Egypt.

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Table of contents

  1. Overview

    • What you need to know
      • Products covered in this Report
      • Executive Summary

          • The market
            • Domestic holiday rentals sector recovers from 2012 trough
              • Overseas holiday property rental market value slightly larger than UK
                • Figure 1: Volume forecast for the domestic holiday rental property market, 2011-21
                • Figure 2: Value forecast for the domestic holiday rental property market, 2011-21
              • Companies and brands
                • Further consolidation as industry giants jockey for position
                  • TripAdvisor shifts from reviewer/referrer to booking site
                    • Airbnb continues to disrupt the industry
                      • Figure 3: Leading holiday rental property agents, by number of properties offered, May 2016
                    • The consumer
                      • Holiday rentals biased towards younger age groups
                        • Scope to tempt back over-55s
                          • Figure 4: Use of holiday rental property in the UK and abroad, March 2016
                        • Majority hadn’t booked for 2016 by mid-March
                          • Figure 5: Holiday rental property booking behaviour for 2016, UK and abroad, March 2016
                        • Third-party reviewers/referrers muddying the waters
                          • Figure 6: Methods used to book most recent holiday rental property, March 2016
                        • Seaside locations are most popular for holiday property rentals
                          • Figure 7: Location of most recent holiday at rental property, March 2016
                        • Majority of holiday rentals are of four to seven nights
                          • Figure 8: Number of nights stayed on most recent holiday at rental property, March 2016
                        • Most ‘undecideds’ use travel review sites to research country/location
                          • Figure 9: Sources used to research country and/or destination for most recent holiday in a rental property, March 2016
                        • Rise of the review
                          • Figure 10: Attitudes towards holiday rental property, March 2016
                        • What we think
                        • Issues and Insights

                            • What does the growing influence of TripAdvisor mean for the industry?
                              • The facts
                                • The implications
                                  • How can owners and agents optimise the appeal of rental properties?
                                    • The facts
                                      • The implications
                                      • The Market – What You Need to Know

                                        • Domestic holiday rentals sector recovers from 2012 trough
                                          • Rental property second most popular type of domestic holiday
                                            • Overseas holiday property rental market value slightly larger than UK
                                              • Flats/apartments lose share in domestic market
                                                • Holiday market bounces back
                                                  • Terrorist threat drives tourists back to old favourites
                                                  • Market Size and Forecast

                                                    • Domestic holiday rentals sector recovers from 2012 trough
                                                      • Figure 11: Trends in the volume and value of the market for domestic holiday rental property, 2011-21
                                                    • Rental property second most popular type of domestic holiday
                                                      • Figure 12: Type of accommodation stayed at on holiday in the UK in the past 12 months, March 2016
                                                    • Forecast methodology
                                                      • Figure 13: Volume forecast for the domestic holiday rental property market, 2011-21
                                                      • Figure 14: Value forecast for the domestic holiday rental property market, 2011-21
                                                    • Overseas holiday property rental market value slightly larger than UK
                                                      • Hotels more dominant in overseas holiday market
                                                        • Figure 15: Type of accommodation stayed at on holiday abroad in past 12 months, March 2016
                                                    • Segment Performance

                                                      • Flats/apartments lose share in domestic market
                                                        • Figure 16: Volume of trips taken in domestic holiday rental property, by segment, 2011-15
                                                        • Figure 17: Expenditure* on trips taken in domestic holiday rental property, by segment**, 2011-15
                                                        • Figure 18: Trends in spend* per trip for holidays taken in domestic rental property, by segment**, 2011-15
                                                        • Figure 19: Trends in nights per trip for holidays taken in domestic rental property, by segment, 2014 and 2015
                                                        • Figure 20: Trends in spend* per night for holidays taken in domestic rental property, by segment**, 2014 and 2015
                                                    • Market Drivers

                                                      • Holiday market bounces back
                                                        • Figure 21: Holidays taken in the past year, March 2016
                                                        • Figure 22: Trends in the number and value of overseas holidays taken by UK residents, 2010-15
                                                        • Figure 23: Trends in the number and value of domestic holidays taken by UK residents, 2010-15
                                                      • Overseas holidays becoming more expensive again
                                                        • Figure 24: Trends in average annual exchange rates, Sterling versus euro and US Dollar, 2010-16
                                                      • Growth in UK economy shows signs of slowing
                                                        • Figure 25: UK average weekly earnings (excluding bonuses)* vs CPI inflation, percentage change year on year, June 2013-March 2016
                                                      • Terrorist threat drives tourists back to old favourites
                                                        • Independent travel recovers
                                                          • Figure 26: Trends in the number of independent overseas holidays, 2010-15
                                                          • Figure 27: Top 10 independently booked overseas holiday destinations, by number of trips, 2010-15
                                                        • Shifts in driving and car ownership have longer-term implications for industry
                                                        • Key Players – What You Need to Know

                                                          • Further consolidation as industry giants jockey for position
                                                            • TripAdvisor shifts from reviewer/referrer to booking site
                                                              • Airbnb continues to disrupt the industry
                                                                • Wyndham Vacation Rentals partners with booking.com
                                                                  • Desire for authenticity tempts travellers away from traditional sources
                                                                    • Overnight taps into desire for spontaneity
                                                                    • Market Share

                                                                      • Further consolidation as industry giants jockey for position
                                                                        • TripAdvisor shifts from reviewer/referrer to booking site
                                                                          • Priceline increases its presence
                                                                            • Airbnb continues to disrupt the industry
                                                                              • Wyndham Vacation Rentals partners with booking.com
                                                                                • Figure 28: Leading holiday rental property agents, by number of properties offered, May 2016
                                                                            • Launch Activity and Innovation

                                                                                • Desire for authenticity tempts travellers away from traditional sources
                                                                                  • Passion Search encourages destination discovery based on passions
                                                                                    • Overnight taps into desire for spontaneity
                                                                                      • Best Western partners with Google Street View for virtual reality tours
                                                                                        • Facebook video comments open up alternative feedback channel
                                                                                        • The Consumer – What You Need to Know

                                                                                          • Holiday rentals biased towards younger age groups
                                                                                            • Majority hadn’t booked for 2016 by mid-March
                                                                                              • Third-party reviewers/referrers muddying the waters
                                                                                                • Operators have choice between fighting back or partnerships/distribution deals
                                                                                                  • Seaside locations are most popular for holiday property rentals
                                                                                                    • Majority of holiday rentals are of four to seven nights
                                                                                                      • Half need to do research to decide destination
                                                                                                        • Most ‘undecideds’ use travel review sites to research country/location
                                                                                                          • Rise of the review
                                                                                                          • Use of Holiday Rental Property in the UK and Abroad

                                                                                                            • UK slightly more popular for holiday rentals
                                                                                                              • Figure 29: Use of holiday rental property in the UK and abroad, March 2016
                                                                                                            • Holiday rentals are biased towards younger age groups
                                                                                                              • Figure 30: Use of holiday rental property in the UK and abroad in the past three years, by age, March 2016
                                                                                                            • Over-55s most likely to be lapsed holiday property renters
                                                                                                              • Figure 31: People who have used holiday rental property in the UK and abroad but not in the past three years and those who have never used it, by age, March 2016
                                                                                                          • Holiday Rental Property Booking Behaviour for 2016

                                                                                                            • Majority hadn’t booked for 2016 by mid-March
                                                                                                              • Figure 32: Holiday rental property booking behaviour for 2016, UK and abroad, March 2016
                                                                                                            • Certainty most important to parents
                                                                                                              • Figure 33: Holiday rental property booking behaviour for 2016, UK, by presence of children in household, March 2016
                                                                                                              • Figure 34: Holiday rental property booking behaviour for 2016, abroad, by presence of children in household, March 2016
                                                                                                          • Methods Used to Book Holiday Rental Property

                                                                                                            • Third-party reviewers/referrers muddying the waters
                                                                                                              • Operators have choice between fighting back or partnerships/distribution deals
                                                                                                                • Figure 35: Methods used to book most recent holiday rental property, March 2016
                                                                                                              • Airbnb-style services most popular among younger consumers
                                                                                                                • Figure 36: Methods used to book most recent holiday rental property, by age, March 2016
                                                                                                            • Location of Most Recent Holiday at Rental Property

                                                                                                              • Seaside locations are most popular for holiday property rentals
                                                                                                                • Figure 37: Location of most recent holiday at rental property, March 2016
                                                                                                              • Women value escapism offered by rural properties
                                                                                                                • Figure 38: Location of most recent holiday at rental property, by gender, March 2016
                                                                                                              • Marketing targeting young should focus on experience and authenticity
                                                                                                                • Figure 39: Location of most recent holiday at rental property, by age, March 2016
                                                                                                            • Nights Stayed on Most Recent Holiday at Rental Property

                                                                                                              • Majority of holiday rentals are of four to seven nights
                                                                                                                • Figure 40: Number of nights stayed on most recent holiday at rental property, March 2016
                                                                                                              • Scope for upselling to different audiences
                                                                                                                • Figure 41: Number of nights stayed on most recent holiday at rental property, by location stayed at, March 2016
                                                                                                            • Researching the Destination for a Holiday in a Rental Property

                                                                                                              • Parents have most involvement in researching rental destinations
                                                                                                                • Figure 42: Personal involvement in researching the destination for a holiday in a rental property, March 2016
                                                                                                              • Half need to do research to decide destination
                                                                                                                • Figure 43: Knowledge of destinations people wanted to visit for most recent holiday in a rental property, March 2016
                                                                                                              • Most ‘undecideds’ use travel review sites to research country/location
                                                                                                                  • Figure 44: Sources used to research country and/or destination for most recent holiday in a rental property, March 2016
                                                                                                                • Growing importance of social and familial connections
                                                                                                                  • Figure 45: Sources used to research country and/or destination for most recent holiday in a rental property, by age, March 2016
                                                                                                              • Attitudes towards Holiday Rental Property

                                                                                                                • Rise of the review
                                                                                                                  • One price and no nasty surprises
                                                                                                                    • Picture this
                                                                                                                      • Get away and switch off
                                                                                                                        • Figure 46: Attitudes towards holiday rental property, March 2016
                                                                                                                      • Women more likely to book in UK to avoid terrorism threat
                                                                                                                        • Figure 47: Agreement with statement ‘The threat of terrorism in overseas locations means I'm more likely to book a holiday rental property in the UK this year’, by gender, March 2016
                                                                                                                      • Women more likely than men to be influenced by reviews
                                                                                                                        • Figure 48: Agreement with statement ‘Reviews written by other people are an important influence on my decision as to which holiday rental property to book’, by gender, March 2016
                                                                                                                    • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                                        • Abbreviations
                                                                                                                          • Consumer research methodology
                                                                                                                          • Appendix – Market Size and Forecast

                                                                                                                            • Forecast scenarios
                                                                                                                              • Figure 49: Volume forecast for the domestic holiday rental property market, 2011-21
                                                                                                                              • Figure 50: Value forecast for the domestic holiday rental property market, 2011-21
                                                                                                                            • Forecast methodology

                                                                                                                            Companies Covered

                                                                                                                            To learn more about the companies covered in this report please contact us.

                                                                                                                            Holiday Rental Property - UK - June 2016

                                                                                                                            £1,995.00 (Excl.Tax)