As short-term rental industry grows, so does use of management tech

The private accommodation space continues to grow around the world, with revenue estimated to reach more than $87 billion by the end of this year and continuing to grow by nearly 4% annually, according to Statista.

In tandem with that growth in booking volume and in the numbers of properties is the increased development of technologies to support this industry.

According to a new report from Rentals United, a channel manager for the short-term rental industry: “As the vacation and short-term rental industry continues to mature and competition heightens, property managers are becoming increasingly driven to improve their use of technology and are adopting more and more software solutions to help them stay ahead of the game.

"It’s now commonplace for professional property managers to automate certain operations, distribution, marketing, revenue management, guest communication and other tasks.”

Rentals United surveyed nearly 1,000 people: About one-third are property managers of varying sizes, with more than half located in Europe, one-quarter in North America and the rest around the world. The remainder of respondents are property owners, consultants, technology providers, investors and representatives of travel agencies, online travel agencies and metasearch companies.

The survey found property management systems are the most widely-adopted software solution in this sector, with 81% of respondents using a PMS to manage day-to-day operations. Most of those (66%) are using a third-party PMS, while 15% have built the tech in-house.

The rate of adoption varies greatly depending on the number of properties managed: 77% of companies with less than 100 properties use a PMS, while for those with from 100 to 499 properties, that jumps to 93%, and with more than 500, there is 100% adoption.

Fifty-seven percent of property managers use an external channel manager in conjunction with their PMS. The highest adoption, again, is for larger property managers: 74% of those with more than 100 units use an external channel manager.

Beyond these two systems, the majority of property managers (76%) also use additional tech solutions. The most popular are payment providers (51%), accounting tools (40%) and keyless entry solutions (33%).

Less popular are emerging solutions such as 3D tours (17%), chatbots (13%), home automation solutions (12%) noise control devices (9%) and voice concierge services (3%).

“The demand for tech innovation in the short-term rental industry continues,” says James Burrows, CEO of Rentals United.

“This report does underline our understanding that the winning models of the future technology providers will work similarly to SaaS platforms by providing enterprise-level, open-source platforms allowing developers to contribute to the code which will in turn increase the investment and the growth of the industry.”