Short-term rentals outpace hotels
Apartments and private homes continue to dominate the holiday accommodation market, even during New Year’s celebrations. The sharp rise in short-term rental prices across most European cities compared to last year reflects their growing appeal among travelers seeking unique and flexible lodging options. However, this popularity comes at a cost.
Hotels across Europe have seen a modest average price increase of +2.71%, but short-term rentals have surged with a dramatic +7.86% increase, underscoring their demand.
While hotels generally command higher average prices, there are notable exceptions where short-term rentals rival or exceed hotel rates. In Innsbruck, for example, short-term rentals average 417 euros, significantly surpassing the 323 euros average for hotels.
For travelers, the choice between a hotel and a private rental depends not only on budget but also on the type of experience they’re seeking. One thing is clear: the popularity of short-term rentals shows no signs of slowing down.
Luxury vs. Budget: Most and least expensive cities
When it comes to hotels, London secures its place as the most luxurious destination for New Year’s Eve, with average rates soaring to an eye-watering 510 euros. In stark contrast, Liverpool stands out as the most affordable option, offering stays at just 168 euros, making it an attractive choice for budget-conscious travelers seeking festive cheer without breaking the bank.
For short-term rentals, London continues to dominate the premium segment with average rates of 467 euros, ideal for those aiming to immerse themselves in the city’s iconic celebrations. Meanwhile, Athens offers a budget-friendly alternative, with short-term rental prices averaging only 156 euros, providing exceptional value for travelers looking to celebrate the new year in a vibrant and historic setting.
Price surges and drops
Bruges has seen a remarkable +21% surge in hotel prices, solidifying its position as a must-visit destination for New Year’s festivities. This growth reflects its rising popularity for festive tourism and its reputation for avoiding the pitfalls of overtourism. On the short-term rental front, Madrid leads with an astonishing +43% price increase, driven by heightened demand and the proliferation of upscale rental options that cater to premium travelers.
Conversely, Paris has experienced a surprising -27% drop in short-term rental prices alongside a -5% decrease in hotel rates. This decline is attributed to an oversupply of properties and the impact of new regulatory measures reshaping the market. Helsinki also stands out with the steepest drop in hotel prices at -9%, offering travelers a more affordable yet chilly option for celebrating the New Year.
Mirko Lalli, CEO of The Data Appeal Company – Almawave Group, comments: “The data highlights the shifting dynamics of traveler preferences and the critical role they play in shaping market strategies. For destinations, understanding pricing trends—such as the surge in short-term rentals or the rising appeal of alternative cities like Liverpool or Trieste—is key to staying competitive. By leveraging these insights, tourism professionals can fine-tune their pricing models, position their offerings more effectively, and ultimately maximize their appeal to both value-driven and premium travelers. It’s not just about following trends; it’s about anticipating them and using data to lead the way.”
Tags: Mirko Lalli, The Data Appeal Company Almawave Group, short-term rentals
