Sources and Analysis of Data on Short-Term and Vacation Rentals

No matter how much you know about the housing market, you can’t guarantee a successful investment. The volatility of real estate plays a significant part in turning away investors and failing others. Investing in real estate is more than an art. Good investors rely on data.  

According to a study, rental property investment is a good way to earn passive income, especially with rising rent prices globally. Most importantly, short-term rentals are taking the lead compared to long-term rentals. But only some essential STR strategies work.

You can conduct thorough data-driven market research with suitable data sources and analysis. This way, you’ll calculate expected costs and profits to help you know if you’re making the right investment decision. Read on to discover more.

Why is Short-Term Rentals Data Important?

While there’s a high demand to invest in short-term rentals, the noticeable fluctuation makes it no longer safe for an educated guess on how to buy vacation rental property. It’s good to know the ins and outs of your desired location. Trusting your instinct on such a significant investment can be very risky.

Relying on credible and easy-to-access techvestor data provides in-depth market analysis to ensure your short-term rental investment is lucrative. Such data is valuable because it involves ground research and analysis of target guest profiles. This way, it becomes easy to eliminate any doubt about the success of your STR strategy.

The numbers and metrics of vacation rental data also help investors to measure the performance of their short-term rental properties. Because data is different, where can an investor find reliable ones? Let’s find out!

Sources of Data for Short-Term Rental Investment

There are 4 primary sources of data for vacation rental property investment;

•   Official statistics: This is the first place one should look at when collecting data on any real estate investment. It would help if you went to or visited the official websites of local authorities and state housing agencies. Here, you can find valuable data on the location and quantity of short-term rentals. However, official statistics still need to include actual capacity and occupancy rates.
•    Platforms data: It features commercial platforms like Airdna to acquire necessary data. However, these platforms ban machine searches from their sites. Usually, data platforms use access controls, proxy blocks, IP detection, and fingerprinting to avoid using several IDs hiding behind proxy servers.
•  Manual collection: Manually obtaining raw data directly from Airbnb or any other third party is excellent. It works well for research where third-party employees are present. However, manual data collection is a demanding and time-consuming task that involves unavoidable human errors.
• Web scraping: The web scraping process involves obtaining data using self-made bots, open databases, and commercial providers.

Types of Data Analysis on Short-term Rentals

Ultimately, vacation rental data is crucial since it allows investors to conduct several analyses that help in the final decision.

Here are some analyses to conduct using the correct short-term rental data:

• Short-Term Rental Property Analysis

Are rental properties a good investment? Choosing the best location to buy rental property is only enough to guarantee positive cash flow and good ROI if you do an analysis. Some properties have rooms and amenities that can perform better in one market than another.

Short-term rental Investment analysis involves using the performance of similar properties as a pointer to show what to expect from your property. Therefore, investors must look for the best and consistent vacation rental data source. This data is valuable in conducting various analyses on the best buying rental property tips.

• Neighborhood Analysis

                                                    Source: Pexels

Another analysis to do when you want to invest in vacation rental property is neighborhood analysis. Like cities, some neighborhoods do better in producing good results for real estate investors.

Generally, it would be best to go for areas with good infrastructure, basic amenities like hospitals and shopping malls, proximity to tourist attractions, and safety. Still, it would help if you considered your neighborhood’s population regarding your clients’ needs. Some people prefer neighborhoods with fewer people, and others want crowded places.

While this analysis may seem tedious, recent real estate technology helps you get necessary data quickly and effortlessly. Use a data source that gives you ready information on your desired neighborhood.

• Competitor Analysis

After completing data-driven research to decide where to buy a rental property, dig deeper. Source data from a booking platform like Airbnb and go through the current properties in your target location.

Are there gaps you could fill in? Perhaps there are no pet-friendly properties or few locations with beautiful views. Look for an excellent opportunity to buy rentals that satisfy a need lacking in other properties.

But, also consider that the lack of what you view as an opportunity might be because there’s no audience for such. Probably, many would have opted to go that route but saw a dead STR strategy in the end. So, think critically before deciding on anything that will get you ahead of your competitors.

• Target Audience Analysis

Doing a thorough analysis of your ideal target audience is also essential to help you grow your real estate passive income. Every successful short-term rental strategy lists specific types of guests. Your guests could be singles, young couples, groups of friends, or large families.

You should know that not everyone will find your listing appealing. Besides, you can’t afford to attract everyone to your short-term rentals.

The best way to identify your ideal guest profile is to look at successful vacation rentals in your target market and see the kind of guests they attract. That way, you’ll learn if the area is kid-friendly or a romantic destination.

Consequently, make your property fit the typical guests in the area or design it for an untapped type of guest. Yet again, think critically to know why a specific guest type is familiar or not in your desired market. Ensure you do this before proceeding with your plans.

Bottom Line

Data is a solid indicator of what the future holds. But you should know that past performance does not guarantee future earnings. So, your data should tell you that your earnings come from a solid STR strategy, and you as the investor.  

Great investors can make money from any property. Passive income real estate investing involves risks. Thus, you must explore your options wisely.