ONLINE HOME RENTAL MARKET SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2024-2031)

Online Home Rental Market Size and Trends

Global online home rental market is estimated to be valued at USD 20.58 Billion in 2024 and is expected to reach USD 48.76 Billion by 2031, exhibiting a compound annual growth rate (CAGR) of 13.1% from 2024 to 2031.

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Users are increasingly adopting online platforms to book homes for short-term and long-term stays due to convenience and variety of options offered.

The online home rental market is expected to witness significant growth owing to rising tourism and business travel worldwide. Growing preference of travelers to explore new destinations independently and book accommodation as per their choice and budget is driving the demand for online home rentals. Increased internet and smartphone penetration is further facilitating the easy access of online home rental platforms to users globally.

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Insights by Property Type: Housing Affordability Drives Growth in Flats Detached Rentals Property

In the terms of property type, flats detached segment is estimated to hold the highest share of the market of 42.0% in 2024, owing to its affordable prices compared to other housing options. Flats or apartments provide an attractive living arrangement for individuals and families looking for housing within budget. Detached flats eliminate the problems associated with shared walls and noise issues from neighboring units, making them a popular choice. Their independent structures ensure high levels of privacy. 

Insights by Price Range: Economy Rentals Cater to Budget-conscious Travelers

In terms of price range, economy segment is estimated to hold the highest share of the market of 42.0% in 2024 owing to strong demand from cost-sensitive visitors. Backpackers, students traveling abroad, and families on recreational trips focus on destinations that fit into their budgets. Rental properties in the economy range successfully meet this demand through affordable nightly or weekly rates.

Insights by End User: Residents Fuel Long-term Rental Demand

In terms of end user, resident segment is estimated to hold the highest share of the market of 38.3% in 2024 owing to needs for long-term housing stable incomes. In comparison to tourists who seek accommodations for only the duration of trips, residents driving the rental market require homes for months or years. Demand from local rents stems from lifestyle needs, career trips, relocations, and real estate investments. Workers relocating to new cities for employment contribute steady resident rental demand. Property owners then benefit from reliable long-stay tenants ensuring consistent monthly occupancy and cashflow.

Regional Insights

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Regional Analysis: Global Online Home Rental Market

Dominating Region: North America

North America dominates the online home rental market with an estimated market share of 43.0% in 2024 due to factors such as strong internet infrastructure, high adoption of digital technologies, and presence of major technology companies Zumper, airnab in the region. Additionally, the region houses many startup companies focusing on home rental and property management technologies. Governments in countries like the U.S. also encourage businesses through supportive regulations.

Fastest-Growing Region: Asia Pacific

Asia Pacific is expected to account for the highest revenue share, with 43.0% in 2024. Meanwhile, the Asia Pacific region exhibits the fastest growth in the online home rental market. Rapid urbanization, growing tourism industry, rising middle class and their increased spending on travel are some key drivers augmenting market developments. Countries like China and India have witnessed a massive growth in their tech ecosystems and startup cultures in recent times.

Online Home Rental Market Outlook for Key Countries

U.S.: The global online home rental market in the U.S. continues to see significant contributions from major companies focusing on innovations and product enhancements.

China: The global online home rental market in China is characterized by presence of global as well as local giants offering differentiated solutions to cater to the needs of customers across demographics.

India: The global online home rental market in India continues to lead with its rapidly growing connectivity and digital infrastructure helping developers offer specialized rental platforms.

Japan: The global online home rental market in Japan growth is supported by increasing business and leisure travel, driving demand for rental accommodations.

Germany: The global online home rental market in Germany sees thriving small enterprises complementing efforts of large operators to tap opportunities across urban and rural areas.

Market Concentration and Competitive Landscape

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Top Strategies Followed by Global Online Home Rental Market Players

Established Players: R&D Investment - Leading online home rental companies like Airbnb and Expedia invest heavily in research and development to introduce innovative new features and enhancements to their platforms. This allows them to maintain an edge over competitors and better serve customers.

Mid-Level Players - Companies like Vacasa and Vrbo focus on providing good value and affordability. They ensure smooth booking and check-in processes at competitive price points to attract cost-conscious travelers. Mid-tier firms collaborate with local property managers and homeowners’ associations to bolster their property portfolios. Partnerships also aid technology upgrades and service improvements.

Small-Scale Players: Niche Specialization - Upstarts distinguish themselves by catering to specific traveler segments, such as families or solo travelers, through specialized listing filters and on-site amenities

Emerging Startups in the Global Online Home Rental Market

Innovative Technologies: Startups like Choirs are applying augmented reality to seamlessly preview homes and IoT sensors to automate comfort/security.

Sustainable Solutions: Firms like Greenstay and Ecocasalist specialize in green listings and carbon offset programs. 

Online Home Rental Industry News

• In May 2023, on global accessibility awareness day, Airbnb, Inc. announced that its representatives had checked and verified the accuracy of nearly 300,000 accessible elements in homes all around the world. Among these were the presence of step-free entrances, fixed grab bars, or bath or shower chairs.
• In April 2023, Evolve issued its seasonal report, analyzing the largest trends in vacation rentals for the winter 2022-23 season. Evolve provides information and statistics to support short-term rental owners in making the most of performance during fluctuation periods, while keeping their competitive edge through this evolving landscape of the traveler accommodation market.
• In March 2023, Zumper is a rental platform that connects users with apartment listings, helping renters find, apply for, and lease homes online. made a totally strategic play into the short-term rental space with Vacations by Zumper, its dedicated vacation listing site, indicating the company's heightened concentration on this space, whose commitment to providing more comprehensive solutions and expansion in this space of ever-expanding temporary accommodation is evident
• In August 2022, Oravel Stays Private Limited,  a global hospitality platform offering budget accommodations and short-term rentals, acquired Bornholmske Feriehuse, a vacation rental operator, to boost its footprint across Europe.

Key Takeaways from Analyst

As more people choose to travel for shorter durations frequently, there will be huge demand for short-term and flexible housing rentals. The ease of finding and booking accommodation online directly from their mobile phones is a major driver for consumers preferring online home rentals. North America currently dominate the online home rental market owing to high smartphone and internet penetration along with the presence of major players. However, Asia Pacific is likely to be the fastest growing market with China and India experiencing a surge in domestic and outbound tourism.

While the market opportunities are huge, fragmented regulations across countries and cities pose a challenge for operators to streamline and scale up their businesses globally. Strict laws in some markets can hinder the growth momentum. Ensuring standardized quality stays and a hassle-free guest experience will be crucial for platforms to sustain consumer loyalty. Competitive pricing and versatile payment options may help operators boost conversions. Collaborating with local property managers can aid expansion into newer locations. Overall, the online home rental market is expected to attract more homeowners to list spaces and provide affordable accommodation options for travelers internationally.

Market Report Scope

Market Dynamics

Market Driver - Rising urban population worldwide

As the globalization trends continue worldwide, there has been a significant rise in urban population across major cities. More job opportunities and improved standard of living is attracting people from rural areas to the bright lights of metropolitan areas. In 2022, according to the United Nations Department of Economic and Social Affairs, urban areas in Africa and Asia will absorb 97% and 64% of future population growth from 2018-2050 respectively. Both individuals and families are increasingly opting for well-furnished rental homes listed on these online portals for short or long stay.

Market Challenge - Stringent regulations for homeowners and landlords

There are many stringent regulations governing homeowners and landlords in the global online home rental market. Different countries and regions have their own set of laws and compliance norms surrounding aspects like safety standards, tax compliance, registration requirements etc. Keeping track of frequent changes in such regulations and ensuring adherence can be challenging for many homeowners and landlords. According to data from the UN Conference on Trade and Development, around 30% of potential hosts cite regulatory hurdles as a primary reason for not listing their properties on short-term rental platforms globally. This regulatory complexity adds an operational hurdle for both property owners as well as platform businesses trying to scale in this market on a global scale. However, many governments are now trying to streamline policies to promote sharing economy while maintaining basic tenant and community safety standards.

Market Opportunities - Emergence of shared economy and collaborative consumption

The rapid growth of shared economy and collaborative consumption business models have opened up opportunities in the global online home rental market. Young professionals and travelers today prefer experiences over possessions and are happy to access services like accommodation on a temporary needs basis. This has boosted demand for short-stay and medium-stay rental homes listed on online platforms. Many homeowners also find home sharing as a convenient option to earn additional income from their properties, especially during periods when they are not residing there. The shared economy model has increased overall utilization of under-used housing assets.

Market Segmentation

•  Property Type Insights (Revenue, USD, 2019 - 2031)
• • Flats Detached
  • Houses
  • Semi-Attached
•  Price Range Insights (Revenue, USD, 2019 - 2031)
• • Economy
  • Mid-Range
  • Premium
•  End User Insights (Revenue, USD, 2019 - 2031)
• • Resident
  • Tourist
• Regional Insights (Revenue, USD, 2019 - 2031)
  • North America
    • U.S.
    • Canada
  • Latin America
    • Brazil
    • Argentina
    • Mexico
    • Rest of Latin America
  • Europe
    • Germany
    • U.K.
    • Spain
    • France
    • Italy
    • Russia
    • Rest of Europe
  • Asia Pacific
    • China
    • India
    • Japan
    • Australia
    • South Korea
    • ASEAN
    • Rest of Asia Pacific
  • Middle East
    • GCC Countries
    • Israel
    • Rest of Middle East
  • Africa
    • South Africa
    • North Africa
    • Central Africa
• Key Players Insights
  • Airbnb
  • HouseMe
  • Quickr Homes
  • Zumper
  • Zillow
  • Lodgis
  • Ciirus inc
  • Squareplums
  • Invitation Homes Inc.