Business challenges
Hosts feel that the most significant impediments to their business success are issues of cost management. These may be more pronounced in a time of concern over saturation and increased standards of competition, which can squeeze topline revenue and warrant more scrutiny over cost control.
Saturation & Competition
The low interest rates of the COVID era, coupled with a sharp increase in demand for the category, brought about a boom of supply and additional listings. But consumer preferences and behavior have shifted since the days of lockdowns. More hotels are open, and the privacy associated with rentals has become more of a preference than an essential health concern. This has caused concern about the ability of U.S. operators to flourish financially and warranted stronger competitive measures for those who look to maximize occupancy or attract the highest-yielding guests.
Staying Competitive
Property managers share a healthy optimism for inventory reaching equilibrium in the long-term, but express more concern over how to address these issues in the short-term.
Churn and closures
Nearly one in four current hosts has stopped renting out at least one property in the past year, whether temporarily or permanently. Additionally, 10% of homeowners surveyed were lapsed STR hosts.
Scaling: What, like it’s hard?
Despite the ambitious growth goals of multiple VC-funded management firms, SPACs and IPOs, property managers have struggled to scale sustainably.
Regulation
Regulation is a major source of uncertainty for the future of industry growth. Despite best efforts to grow and scale businesses, local or regional regulation can shut a business down virtually overnight – as was the case in New York City.
Phocuswright’s U.S. Short-Term Rentals 2025: Host and Property Manager Trends is part of a comprehensive consumer research study focused on the incredibly dynamic short-term rental travel segment. Key questions answered by this research include:
- How has the U.S. short-term rental market evolved post-pandemic, and what challenges do hosts and property managers face in 2025?
- What distinguishes successful hosts and property managers from those struggling to compete?
- How are shifting guest preferences and market saturation impacting short-term rental demand?
- What role do regulation and financial management play in the sustainability of STR businesses?
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