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Short-Term Rentals: A category at a crossroads

  • phocuswright.com
  • 1 April 2025
  • 2 minute read
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This article was written by Phocuswright. Click here to read the original article

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The short-term rental sector was once the pandemic-era darling—offering privacy, safety, and space when travelers needed it most. But now, as the dust settles, its place in the lodging landscape is less assured.

According to Phocuswright’s latest research report U.S. Short-Term Rentals 2025: Guest Attitudes and Decision Making, usage among U.S. leisure travelers has plateaued at around one-quarter of the market since 2020. That stability may appear promising, but it also masks a deeper issue: stagnation. While Airbnb continues to post strong earnings, the category overall is grappling with reputational drag—fueled by viral headlines, uneven guest experiences, and rising scrutiny from the next generation of travelers.

Younger guests—those under 35—are showing signs of skepticism. They’re less likely to see STRs as offering the best overall stay. They’re more sensitive to negative press. And they’re less convinced that rentals deliver real value for money, despite the category’s advantages in space, amenities, and flexibility. If these perceptions persist, future growth is at risk.

At the same time, hosts themselves recognize the problem. A majority agree that unprofessional behavior across the sector is eroding consumer trust. And when nearly two-thirds of guests—regardless of whether they’ve stayed in a rental recently—say that negative stories have impacted their decision-making, the message is clear: public perception matters as much as product delivery.

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The STR industry isn’t just maturing—it’s under pressure to evolve. Transparency, consistency, and reputation management are no longer optional; they are the levers of future relevance. In a crowded marketplace, the ability to shape perception may be just as critical as what you build behind the front door.

Phocuswright’s U.S. Short-Term Rentals 2025: Guest Attitudes and Decision Making is part of a comprehensive consumer research study focused on the incredibly dynamic short-term rental travel segment.

Key strategic questions answered by this research include:

  • What drives travelers to choose short-term rentals over hotels—and what keeps them from doing so?
  • How do guest expectations and satisfaction levels vary across age groups, property tiers, and booking behaviors?
  • How are STR guests shopping, booking, and comparing rentals with other lodging options?
  • What implications do guest preferences and perceptions have for property managers, hosts, and platforms?

Please click here to access the full original article.

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