Ever wondered if you could make more money by converting your Airbnb listing to a mid-term rental? If you’re nodding your head in agreement, then you’re at the right place. Today, we’re diving deep into an analysis conducted by IntelliHost to understand the profitability dynamics of mid-term rentals vs. short-term rentals.
But before we proceed, let’s clarify what we mean by ‘mid-term rentals.’ These are any rentals that cater to guests looking to stay for 14 days or more, often stretching up to 30 days.
Recently, there’s been a rising trend of hosts converting their short-term rentals into mid-term rentals, banking on the prospect of better revenues. But does the number-crunching back this move? Let’s find out.
PSSSSST! Would you rather watch the video breakdown of this study? Click HERE to watch the short analysis on Youtube.
Impressions: First Touchpoint with Potential Guests
Contrary to popular belief, Our analysis revealed that mid-term rentals slightly outpace short-term rentals when it comes to average daily impressions. Impressions are simply the number of times your listing appears in search results. Mid-term rentals registered an average of 425 daily impressions compared to the 398 daily impressions for short-term rentals.
One might assume that setting a minimum stay limit of 14 nights or more would reduce the number of potential guests who come across your listing. However, the data suggests otherwise, possibly pointing to factors such as attractive nightly rates playing a role in boosting impressions for mid-term rentals.
Visibility and Click Rates: Catching the Guests’ Eye
When it comes to securing a spot on the first page of search results, there’s a level playing field between the two types of rentals, with both securing a first-page impression rate of approximately 46%.
The click rate, which measures how often your listing is clicked on after appearing in search, is also almost identical for both types of rentals, with short-term rentals scoring a marginally higher rate.
Conversion Rates: Turning Impressions into Bookings
Here’s where things get interesting: mid-term rentals boast nearly double the conversion rate (the rate at which clicks turn into bookings) compared to short-term rentals. This might be attributed to a scarcity factor, with fewer mid-term stays available, leading to higher conversion rates.
Nightly Rates and Occupancy: The Revenue Generators
Despite the impressive conversion rates, the average nightly rate for mid-term rentals is significantly lower—almost half of short-term rentals ($155 vs. $303). However, mid-term rentals partially bridge this gap with a slightly higher occupancy rate, i.e., the proportion of time a property is rented out. They clock in an average occupancy rate of 51% as compared to the 38% for short-term rentals.
Revenue Comparison: The Bottom Line
When it all boils down to the final question—”Which brings in more money?”—the answer, as per the data, is short-term rentals. Over a 60-day period, short-term rentals generated an average of $5,000 compared to the $4,000 by mid-term rentals—a noteworthy difference of 25%.
Our analysis underscores that, although there can be valid reasons to opt for mid-term rentals, such as fewer guest turnovers and local regulations, if the bottom line for you is revenue, then short-term rentals may be the better bet.
However, it’s essential to understand the context of this data: this study compared metrics from different sets of properties, not the same properties toggling between short-term and mid-term rentals. Moreover, your best choice could be dictated by location-specific or individual factors.
A key takeaway here is that successful hosting is an art that thrives on the science of data. Turning your Airbnb into a profitable venture is no guessing game. It’s about making informed decisions based on data-driven insights, precisely what IntelliHost equips you with.
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