FB
VRC_Full_Horizontal_logoVRC Logo 512 x 512
Vacation Rental Collective - Book Now at BookVRC.com!

Homeowner Newsletter - February 2025

Vacation Rental Market Update

We like to begin the year by reviewing the key trends we observed at the close of 2024, along with our predictions and expectations for 2025. This gives you context for what to expect in the year ahead.

In 2024, the vacation rental market experienced significant shifts, driven by economic factors, changing traveler preferences, and evolving regulations. While some regions continued to perform well, others faced more persistent challenges.

The summary and predictions included here are adapted from data insights provided by Skift, Key Data Dashboard, The Wall Street Journal, Reuters, Beyond Pricing, and other industry publications.
2024 Market Performance:

Supply Growth Deceleration: The expansion of new short-term rental listings slowed significantly, with a nationwide increase of just 6.8% in 2024, down from 14.4% in 2023 and 22.1% in 2022. 

Occupancy Variations: Some markets saw occupancy stabilize at levels similar to those of 2019, before the pandemic, while others experienced double-digit declines. On average, the Mountain Regions of the U.S. ended 2024 with an 8% decrease in occupancy compared to 2023, with the largest decline occurring in Q4. In contrast, the Vacation Rental Collective portfolio maintained its year-over-year occupancy rate, with most markets either staying flat or seeing a slight change (up or down by +/- 2%).

Traveler Behavior:

Short-Term Rentals Remain Popular with Travelers: Short-term rentals continue to be a preferred accommodation choice for travelers. While there was an initial shift back to hotels post-pandemic, concerns about "vacation rental fatigue" have eased. According to Skift Research, traveler satisfaction with vacation rentals remains high, particularly among millennials who enjoy the flexibility of remote work. 

Family Travel Takes the Lead: Family Travel is the most popular travel category with 50% of travelers traveling with family.

Professional Management Matters: Skift Research found that 76% of travelers check if a property is professionally managed before booking. Travlers prefer professionally managed homes for the enhanced service, trustworthiness, and consistency that come with professional management.

Smaller Destinations Gaining Popularity: A clear trend has emerged toward smaller cities and rural areas, as travelers seek unique, off-the-beaten-path experiences. This shift has helped bolster occupancy and drive higher average daily rates in some of our markets, such as Ouray, CO.

Regulatory Landscape:

Shift Toward Stricter Regulations and Higher Taxes & Fees: The regulatory landscape for short-term rentals (STRs) is becoming increasingly stringent, with local and state policy boards implementing tighter regulations to balance housing availability and “neighborhood quality”. Additionally, many local governments are introducing higher fees and more punitive taxes, including excise taxes specifically targeting short-term rentals.
2025 Vacation Rental Market Projections:
Looking ahead to 2025, the domestic vacation rental market is expected to experience a modest rebound compared to 2024 performance. Several key factors will shape the outlook:

Market Stabilization: After a period of rapid growth, the market is expected to stabilize, with growth rates returning to more sustainable levels.

Shorter Stays and Lead Times:
Guests are booking shorter stays and making reservations closer to their travel dates, with both length of stay and lead time shrinking year over year.

Demand for Unique Destinations: There remains strong demand for smaller towns and unique destinations. Properties located in off-the-beaten-path locations are well-positioned to capitalize on this trend.

Meeting Rising Guest Expectations: As competition increases with more properties entering the market, those that maintain high-quality standards will perform best. Properties that command the highest nightly rates and achieve above-average occupancy rates are those that meet rising guest expectations. These properties typically feature modern design aesthetics, quality furnishings, white linens, and a wide range of amenities.

A Trend to Keep an Eye On: American Travelers Showing Caution About Spending on Trips

Financial Sentiment: In January 2025, Future Partners (formerly Destination Analysts) found that while 51.5% of American travelers remain optimistic about their financial outlook, fewer travelers feel better off financially compared to the previous year. Only 29.2% reported an improvement—marking the second time in three months thids figure has fallen below 30%.

Travel Budgets Decline: The expected annual leisure travel budget dropped by over 15%, from $5,898 to $4,973. High travel costs and personal financial concerns are the main factors deterring Americans from booking trips, with excitement for travel reaching a 7-month low (an average of 8.1 on a 0-10 scale). These indicators suggest a growing sense of caution among American travelers, which may impact future travel trends.

Early Signs of Emerging Trends Reflected in VRC 2025 Pacing:

VRC’s 2025 pacing started strong, with a year-over-year increase of over 30%. However, in the past three weeks, we've seen a slowdown in new reservations and a slight uptick in cancellations in January and February due to travelers changing their plans. Factors contributing to this include below-average snowpack, unseasonably warm temperatures in some resort markets, in addition to the declining consumer confidence noted above. These trends align with what larger OTAs (Vrbo & Airbnb) are reporting across their platforms.
In Summary: Looking forward, the market is expected to stabilize, with modest growth anticipated for 2025. Key themes to watch include rising guest expectations, demand for unique destinations, and a growing caution among American travelers about travel spending. The properties who adapt to these trends, maintain high-quality standards, and navigate regulatory changes will be best positioned for success in the year ahead.

Preparing for Tax Season


Preparing for Tax Season: 1099 Rental Income & Your December 2024 Owner Statement

The IRS requires us to report your home's gross income for the year on your annual 1099 which was mailed to the address we have on file for you at the end of January.

You can find your annual expenses, including your management commission, on your December 2024 Owner Statement. The Year-to-Date Total Column on your December statement (see example below) provides your property’s total income and expenses for the entire year. It includes both the Year-to-Date Total column on the left (circled in orange) and the breakdown for Current Period (for the month of December) income (credits) and expenses (debits). This is the statement you’ll want to share with your tax accountant when preparing your taxes.
You’ll note that the Owner Statement shows Year-to-Date Total is the column on the left (circled in orange) and Expense (debits) and Income (credits) for the Current Period — meaning the current month.
Reporting Short-Term Rental Income: Schedule C vs. Schedule E

It’s important to consult with your tax preparer about how to report your short-term rental income. While long-term rental income is always reported on Schedule E, short-term rental income is often reported on Schedule C. This is because the average rental period is typically less than 7 days, and substantial services are provided —such as cleaning, linens, utilities and other amenities—that go beyond what a long term rental offers.

Your tax preparer may recommend reporting your rental income and expenses on Schedule C instead of Schedule E. When reporting rental income on Schedule C, personal usage days are not reported and losses are not subject to loss limitations.

Tips & Tricks for Navigating the Owner Portal


Booking Summary – The Booking Summary tab offers an overview of your property’s reservations, including stay dates, number of nights, guest count, and the gross rent for each stay.
Statements Tab – The Statements Tab provides easy access to Owner Statements and allows you to download statements from previous months.
Calendar Tab – The Calendar Tab allows you to set up Owner Stays or Guest of Owner Stays and view your bookings by month.
Important Reminders: Keep Your Calendar Up to Date with your Owner Stays. Please ensure your calendar reflects any planned owner stays. You can reserve dates for yourself and your family through the Owner Portal or reach out to us via email for assistance. While our calendars open 13 months in advance, you're welcome to book owner stays as far out in advance as you'd like. We encourage you to plan ahead and secure your preferred dates. If your plans change, we can always reopen the rental dates.
Owner Cancellations that displace guests are not permitted: If a cancellation affects a guest’s reservation, you will be responsible for any cancellation fees imposed by the OTA (Vrbo, Airbnb, Booking.com). Additionally, your home will be subject to suspension from Vrbo’s platform. Thank you for your cooperation in keeping your calendar up to date!

Top Ways to Stay Competitive & Boost Your Vacation Rental Revenue

As a vacation rental homeowner, you know how crucial it is to stand out in a crowded market. One of the biggest factors influencing your property’s performance is design. Guests scroll quickly, and if your listing doesn’t catch their eye, they’ll book elsewhere. The good news? You don’t need a full renovation to make a noticeable difference! Here are five key ways to refresh your space and boost your revenue.

Consider a refresh

Small updates can go a long way in improving the overall appeal of your vacation rental. Over time, normal wear and tear can affect the look of your home, and outdated furnishings might turn off potential guests. A fresh coat of paint and modernizing your furniture can make a big impact without the need for an expensive overhaul. Guests are more likely to book a home that feels fresh and inviting—so don’t underestimate the power of a simple refresh!

Switch to White Linens and Washable Duvets

If you haven’t already, now’s the time to switch to white linens, towels, and washable duvets. These are not only the hospitality standard, but they also give your home a clean, crisp look that guests love. White linens are universally appealing, and they create a sense of luxury that makes guests feel pampered and welcome.

Add Amenities to Attract Guests

To remain competitive in a saturated market, consider adding top-notch amenities that guests are looking for. Whether it’s a private hot tub, a ping-pong table, or an arcade game, these additions can set your property apart from others. The right amenities can make all the difference in attracting guests, especially when they’re comparing multiple listings. Adding unique features will help keep your property top-of-mind for returning guests.

Optimize Your Usage of Your Property

To maximize your revenue, consider adjusting how and when you use your vacation home. Peak seasons bring the highest nightly rates and demand, so if you’re staying at your property during these times, you’re likely leaving money on the table. Instead, keep your calendar open and let guests occupy these high-revenue periods. By visiting during the off-season, you can ensure your property is booked during peak times, boosting your rental income. If you'd like guidance on the best times to schedule your personal stays without missing out on prime rental periods, feel free to reach out to your VRC representative.

Upgrade Your Beds & Pillows

A good night's sleep is a top priority for vacationers, and guests often rank comfortable beds and pillows as one of their most important factors when booking. Upgrading to high-quality mattresses, pillows, and bedding will make a noticeable difference in guest satisfaction. Well-rested guests are more likely to leave positive reviews, return for future stays, and recommend your property to others.
By making these thoughtful updates, you can keep your property competitive and increase your revenue without the need for major renovations. Even small changes can make a big impact on guest satisfaction, helping you stand out in the vacation rental market. We’re here to help! Through our group purchasing network, we offer access to a wide range of vendors—from interior designers and contract-grade furniture suppliers to top-quality hospitality linens and more—all available to our homeowner partners. Plus, we have trusted local contacts who can help turn your refresh ideas into reality.
Contact VRC Today

Refreshed Website & Booking Experience

We've given our website and booking engine a complete refresh to enhance the experience for both homeowners and guests! The new design makes it easier for travelers to find and book your property and is part of our ongoing commitment to maximizing your rental home's success.

Dedicated Destination Pages & Search

Each destination now has its own dedicated webpage, complete with a search bar and customizable filters to help guests find the perfect stay. This update makes it easier for travelers to explore properties in their desired location while refining their search based on their preferences. By streamlining the booking process, we’re increasing visibility for your home and making it even more accessible to the right guests.

Search by Property Name

We know you are used to being able to easily search by property name on our website. This feature is currently being developed and will be available back on the website soon! The Search by Property Name feature also makes it easier than ever for repeat guests to find and book their favorite vacation rental. Instead of browsing through listings, they can simply enter the property name and go straight to the booking page. 

Zoom Map Function

We're currently enhancing our map feature to include a dynamic zoom function. As guests zoom in on different areas, the available properties will automatically update on the left, making it easier to explore listings in their desired location. This improvement will create a more intuitive and seamless booking experience, helping potential guests find the perfect stay with ease.

Improved User Experience

With all these updates, our website now offers a more seamless and intuitive user experience. From dedicated destination pages and enhanced search features to a dynamic map function, every improvement is designed to make finding and booking a vacation rental easier than ever.

Ready for VRC to manage your property?

We provide full-service expert care for vacation rental properties to ensure a seamless experience for homeowners and guests alike.
Experience unforgettable getaways with Vacation Rental Collective, where our stunning destinations offer the perfect blend of relaxation and adventure.
Discover VRC Destinations
Copyright © Vacation Rental Collective 
linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram