According to AirDNA data, despite this decline in demand, the occupancy rate observed in Europe remains strong (61.4%), a 2.7% increase over 2019. Available listings have continued to climb relative to 2021 (+16.1%) but have failed to return to their pre-pandemic levels (-9.4% vs. 2019).
Average Daily Rates have been impacted by the slowing demand growth observed throughout the month: while still 25.3% above 2019, rates were 0.1% lower relative to 2021 as bookings returned to the largest cities with smaller unit sizes, which typically charge lower rates.
Nine of the top 20 European countries saw positive demand figures in August relative to 2019, but this number was reduced to just six in September: France led the way (+19%), followed by Germany (+16%), Austria (+15%), Greece (+14%), Belgium (+1%) and Italy (+1%). Supply growth was equally mixed among the top 20 countries, with the strongest growth in Norway (11.2%), France (8.5%), and Poland (7.7%).
France top performer in demand and supply growth over 2019
The largest short-term rental market in Europe shows 66.4% of all short-term rental listings to be found outside of large cities, with coastal areas growing at the fastest pace (+2% of market share vs. September 2019). This is a result of a change in the demand mix, which took occupancy levels through the roof in the mountain, coastal, rural and midsize city areas where supply growth has not been able to meet the surging demand resulting from new pandemic travel patterns fast enough.
Paris’ greater area saw the most significant year-over-year change in summer occupancy (+24.2%) and demand (+73.6%); although relative to the summer of 2019, supply and demand in the area remained 20.8% and 25.9% lower, respectively.
Of the 37.8% of short-term rental bookings made by international travelers in Q3 2022 in France, the British led the crowds, making up 17% of international bookings in the country (17%), followed by the US (15.4%), and Germany (12.4%), which increased its share the greatest when compared to pre-pandemic levels (+2.2%).
Future demand decline brought about by tumultuous times
While demand for European stays in October and November is pacing 8% above pre-pandemic levels (+24.9% vs. 2021), the economic uncertainty aggravated by energy shortages and inflation seems to be taking its toll on winter bookings.
Demand for December to March is pacing 15.7% below 2019, although 11.7% above 2021–a time when Omicron restrictions were still impeding travel among the continent. When broken down to the country level, only three countries are seeing winter bookings above 2019: Austria (+18.5%), Finland (10.9%) and France (7.8%).
Tags: AirDNA
