Vacation Rental Market Size, Share, Growth, and Industry Analysis, By Types (Short-term rental apartments, Farm stays, Private homes, Cabins, Beach houses, Villas, Cottages, Chalets), By Applications (Monthly, Weekly, Nightly) , and Regional Insights and Forecast to 2034

Vacation Rental Market Size

The Global Vacation Rental Market size was USD 106.51 billion in 2024 and is projected to reach USD 112.76 billion in 2025, growing further to USD 119.38 billion in 2026, and USD 188.42 billion by 2034. The market is expected to expand at a CAGR of 5.87% during the forecast period of 2025–2034. With 49% of travelers opting for nightly stays, 46% preferring private homes, and 55% showing preference for sustainable properties, the market reflects strong momentum across urban, coastal, and rural vacation destinations.

The US Vacation Rental Market is experiencing rapid growth, accounting for 68% of North America’s share. Nearly 42% of travelers in the US prefer vacation rentals over hotels, while 37% of business travelers choose them for cost-effectiveness. Additionally, 33% of US families opt for private homes for extended vacations, and 29% of millennials seek short-term city rentals. With 54% of bookings driven through mobile platforms, the US market demonstrates significant digital adoption and evolving consumer preferences.

Key Findings

• Market Size: Global market valued at USD 106.51 billion in 2024, USD 112.76 billion in 2025, and USD 188.42 billion in 2034, with 5.87% CAGR growth forecast.
• Growth Drivers: 63% of tourists prefer flexible stays, 52% of business travelers adopt rentals, 55% value sustainability, 61% trust AI-based digital booking features.
• Trends: 49% of bookings are nightly rentals, 46% travelers select private homes, 31% prefer coastal destinations, 42% families demand vacation rentals.
• Key Players: Airbnb, Booking Holdings, Expedia, TripAdvisor, Wyndham Destinations & more.
• Regional Insights: North America 37%—urban and coastal stays; Europe 34%—villas, cottages, chalets; Asia-Pacific 23%—city apartments and beach houses; Middle East & Africa 6%—luxury villas and homestays. Total 100%.
• Challenges: 39% operators face regulations, 44% occupancy decline in off-peak, 31% trust concerns, 33% pricing pressure, 27% cancellations create operational difficulties.
• Industry Impact: 72% bookings digital, 54% via mobile apps, 55% sustainability demand, 46% personalization features, 40% long-stay bookings drive new growth opportunities.
• Recent Developments: 27% eco-certified rentals listed, 36% adopt AI pricing tools, 19% expand European coverage, 22% activity bundles, 18% villa listings added globally.

The vacation rental market is undergoing rapid transformation with increasing demand for flexible and personalized stays. Around 71% of travelers prioritize rentals with modern amenities such as Wi-Fi and kitchens, while 35% emphasize eco-friendly features. Coastal and urban destinations dominate, holding a combined 83% share of demand, while rural tourism contributes steadily with 17%. Mobile-first adoption continues to rise, with 62% of reservations made through apps. With 46% of users choosing private homes, consumer preference shifts continue to reshape the competitive landscape.

Vacation Rental Market Trends

The vacation rental market is witnessing significant adoption worldwide as travelers increasingly prefer private stays over traditional hotels. Around 65% of global travelers are opting for vacation rentals due to affordability and better local experiences. Approximately 58% of families choose rental homes because they offer larger space compared to hotels, while 42% of solo travelers prefer short-term rentals for flexibility. Urban vacation rentals account for nearly 47% of the overall demand, while coastal and beach destinations capture about 36% of bookings. Rural and countryside rentals are also gaining traction, contributing 17% share of the market. Mobile app-based bookings dominate with 62% share, while direct website bookings stand at 28% and agent-assisted bookings contribute 10%. North America holds close to 37% of the global vacation rental demand, while Europe represents 34%, and Asia-Pacific accounts for 23% market share. The remaining 6% is distributed among Latin America, Middle East, and Africa. Additionally, 71% of travelers prioritize rentals with amenities like kitchens and Wi-Fi, while 55% prefer properties with sustainable and eco-friendly features, showing shifting consumer preferences in this segment.

Vacation Rental Market Dynamics

OPPORTUNITY

Growing demand for flexible stays

Nearly 63% of global tourists prefer flexible vacation rental stays compared to fixed hotel schedules. About 49% of millennials book rental homes to experience local culture, while 52% of business travelers consider short-term rentals due to cost savings. Over 40% of long-stay bookings are for durations exceeding two weeks, reflecting opportunities in extended vacation segments.

DRIVERS

Rising preference for digital platforms

Around 72% of vacation rental bookings occur via online platforms, with mobile apps alone driving 54% of total reservations. Digital adoption has surged, with 61% of travelers relying on AI-driven suggestions for property choices. Additionally, 46% of repeat travelers prefer vacation rentals due to seamless digital payment and cancellation policies offered by platforms.

RESTRAINTS

"Regulatory and compliance challenges"

Nearly 39% of vacation rental operators face compliance restrictions in metropolitan cities. Around 28% of rental properties encounter limitations due to zoning laws, while 22% of hosts cite rising regulatory fees as a hurdle. Moreover, 31% of travelers express concerns about property verification, impacting trust and slowing market penetration in regulated regions.

CHALLENGE

"Seasonal fluctuations and occupancy"

Approximately 44% of vacation rentals report occupancy declines during off-peak seasons. Around 36% of properties face revenue loss due to seasonal dependency, while 27% of hosts struggle with last-minute cancellations. Additionally, 33% of operators highlight rising operational costs during low-demand periods, creating challenges in sustaining profitability year-round.

Segmentation Analysis

The global vacation rental market size was USD 106.51 Billion in 2024 and is projected to touch USD 112.76 Billion in 2025, further reaching USD 188.42 Billion by 2034 at a CAGR of 5.87% during the forecast period. By type, short-term rental apartments, farm stays, private homes, cabins, beach houses, villas, cottages, and chalets are the primary categories. Short-term rental apartments hold a significant share of the market with strong growth prospects. Villas and beach houses are gaining popularity due to premium leisure demand, while cottages and chalets show steady adoption in seasonal tourism. By application, monthly, weekly, and nightly rentals reflect diverse customer choices, with nightly rentals accounting for the highest share due to short-term travel preferences. Each segment is projected to expand with distinct drivers across regions, contributing to overall industry growth momentum.

By Type

Short-term Rental Apartments

Short-term rental apartments dominate the market with increasing demand among urban travelers and business visitors. Approximately 41% of urban renters prefer apartments due to affordability and proximity to city centers, making this type a core driver of growth worldwide.

Short-term rental apartments held the largest share in the vacation rental market, accounting for USD 28.77 Billion in 2025, representing 25.5% of the total market. This segment is expected to grow at a CAGR of 6.2% from 2025 to 2034, driven by urbanization, digital platforms, and rising millennial travel preferences.

Top 3 Major Dominant Countries in the Short-term Rental Apartments Segment

• United States led the Short-term Rental Apartments segment with a market size of USD 8.42 Billion in 2025, holding a 29.2% share and expected to grow at a CAGR of 6.3% due to high business and leisure demand.
• Germany held a market size of USD 5.13 Billion in 2025 with a 17.8% share and CAGR of 6.1%, fueled by urban tourism and digital adoption.
• Japan reached USD 4.12 Billion in 2025, capturing 14.3% share, expected to expand at 6.0% CAGR due to tourism inflows and demand for compact urban rentals.

Farm Stays

Farm stays are gaining momentum with eco-tourism and wellness trends. Around 18% of tourists prefer rural destinations with cultural immersion, while 22% of families opt for agritourism-based vacation rentals.

Farm stays accounted for USD 9.58 Billion in 2025, representing 8.5% of the total market, and are projected to grow at a CAGR of 5.3% during the forecast period, supported by sustainable tourism and rural travel trends.

Top 3 Major Dominant Countries in the Farm Stays Segment

• France led with USD 2.14 Billion in 2025, holding 22.3% share and a CAGR of 5.5% due to strong agritourism culture.
• Italy stood at USD 1.83 Billion in 2025, with 19.1% share and CAGR of 5.4% driven by countryside heritage tourism.
• Australia reached USD 1.35 Billion in 2025, capturing 14.1% share and CAGR of 5.2% backed by eco-rural vacation demand.

Private Homes

Private homes account for a strong share as families and groups seek larger spaces and privacy. Approximately 46% of vacation rental users prefer private homes for extended stays.

Private homes were valued at USD 22.81 Billion in 2025, contributing 20.2% share of the market, expected to grow at a CAGR of 5.9% supported by long-stay bookings and family travel demand.

Top 3 Major Dominant Countries in the Private Homes Segment

• United States at USD 6.73 Billion in 2025, holding 29.5% share and CAGR of 6.0% with rising suburban vacation home rentals.
• United Kingdom with USD 3.96 Billion in 2025, holding 17.4% share and CAGR of 5.8% driven by holiday countryside demand.
• China with USD 3.25 Billion in 2025, accounting 14.2% share and CAGR of 6.1% due to growing domestic tourism.

Cabins

Cabins are popular in nature-centric destinations, especially among travelers seeking adventure. Around 14% of bookings in cold-weather regions are made for cabins.

Cabins accounted for USD 10.28 Billion in 2025, representing 9.1% of the market, projected to grow at a CAGR of 5.6% due to demand in North America and Nordic regions.

Top 3 Major Dominant Countries in the Cabins Segment

• Canada with USD 2.89 Billion in 2025, 28.1% share, CAGR of 5.7% fueled by wilderness tourism.
• Norway with USD 2.14 Billion in 2025, 20.8% share, CAGR of 5.5% due to Arctic and adventure tourism.
• United States with USD 1.96 Billion in 2025, 19.0% share, CAGR of 5.6% supported by forest and mountain destinations.

Beach Houses

Beach houses continue to attract travelers seeking coastal leisure. Approximately 31% of vacationers prefer coastal destinations, driving strong beach house demand globally.

Beach houses reached USD 12.19 Billion in 2025, representing 10.8% market share, with a CAGR of 5.8% driven by premium lifestyle tourism and family coastal vacations.

Top 3 Major Dominant Countries in the Beach Houses Segment

• United States at USD 3.71 Billion in 2025, 30.4% share, CAGR of 5.9% led by Florida and California coastlines.
• Spain with USD 2.57 Billion in 2025, 21.1% share, CAGR of 5.8% driven by Mediterranean tourism.
• Australia with USD 2.01 Billion in 2025, 16.5% share, CAGR of 5.7% led by Gold Coast and Sydney beaches.

Villas

Luxury travelers increasingly prefer villas for privacy and premium amenities. Nearly 27% of high-income travelers choose villas for their vacations.

Villas generated USD 14.68 Billion in 2025, accounting for 13.0% share of the market, expanding at a CAGR of 6.0% with growth led by luxury tourism and group stays.

Top 3 Major Dominant Countries in the Villas Segment

• Italy with USD 3.82 Billion in 2025, 26.0% share, CAGR of 6.1% driven by heritage villas and Mediterranean demand.
• United Arab Emirates at USD 2.97 Billion in 2025, 20.2% share, CAGR of 6.0% due to luxury and leisure tourism.
• Thailand at USD 2.35 Billion in 2025, 16.0% share, CAGR of 6.0% supported by beachside luxury stays.

Cottages

Cottages are favored for countryside vacations, especially among families seeking peaceful retreats. Around 12% of European vacation rentals are cottages.

Cottages accounted for USD 8.02 Billion in 2025, representing 7.1% share of the market, growing at CAGR of 5.5% due to cultural and seasonal travel demand.

Top 3 Major Dominant Countries in the Cottages Segment

• United Kingdom with USD 2.74 Billion in 2025, 34.2% share, CAGR of 5.5% due to countryside heritage demand.
• France with USD 2.11 Billion in 2025, 26.3% share, CAGR of 5.4% driven by rural tourism.
• Canada with USD 1.65 Billion in 2025, 20.6% share, CAGR of 5.5% due to demand in Ontario and Quebec regions.

Chalets

Chalets are a key choice in winter sports destinations, especially across alpine regions. About 15% of mountain travelers opt for chalets for skiing holidays.

Chalets accounted for USD 7.43 Billion in 2025, representing 6.6% share, with a CAGR of 5.4% driven by snow tourism and adventure-based travel.

Top 3 Major Dominant Countries in the Chalets Segment

• Switzerland with USD 2.19 Billion in 2025, 29.5% share, CAGR of 5.5% fueled by Alps winter tourism.
• Austria at USD 1.96 Billion in 2025, 26.3% share, CAGR of 5.4% supported by ski resort stays.
• France at USD 1.57 Billion in 2025, 21.1% share, CAGR of 5.4% with strong alpine holiday demand.

By Application

Monthly

Monthly vacation rentals are becoming popular among remote workers and long-stay travelers. Nearly 21% of renters opt for monthly bookings for workations and extended leisure stays.

Monthly rentals accounted for USD 21.32 Billion in 2025, representing 18.9% share, with CAGR of 5.7% driven by digital nomads and corporate travel policies.

Top 3 Major Dominant Countries in the Monthly Segment

• United States at USD 6.48 Billion in 2025, 30.4% share, CAGR of 5.8% supported by work-from-anywhere demand.
• Germany at USD 4.06 Billion in 2025, 19.0% share, CAGR of 5.7% due to business and leisure mix stays.
• India at USD 3.02 Billion in 2025, 14.1% share, CAGR of 5.6% led by extended corporate travel demand.

Weekly

Weekly rentals remain attractive for family holidays and seasonal travel. Around 33% of tourists select weekly bookings for balanced cost and convenience.

Weekly rentals were valued at USD 35.26 Billion in 2025, holding 31.3% share, growing at CAGR of 5.8% driven by family tourism and peak holiday seasons.

Top 3 Major Dominant Countries in the Weekly Segment

• France with USD 7.19 Billion in 2025, 20.4% share, CAGR of 5.9% due to holiday traditions.
• United States at USD 6.81 Billion in 2025, 19.3% share, CAGR of 5.8% supported by family leisure travel.
• Spain with USD 6.01 Billion in 2025, 17.0% share, CAGR of 5.7% led by coastal holiday demand.

Nightly

Nightly rentals dominate the segment as short-term travelers and tourists seek flexibility. Around 46% of global vacation rental users prefer nightly rentals for affordability and convenience.

Nightly rentals accounted for USD 56.18 Billion in 2025, representing 49.8% share, and are projected to grow at CAGR of 5.9% led by short-term city trips and leisure breaks.

Top 3 Major Dominant Countries in the Nightly Segment

• United States at USD 14.73 Billion in 2025, 26.2% share, CAGR of 6.0% fueled by urban tourism.
• China with USD 10.12 Billion in 2025, 18.0% share, CAGR of 5.9% supported by domestic city travel.
• Italy with USD 8.25 Billion in 2025, 14.7% share, CAGR of 5.8% due to heritage city tourism.

Vacation Rental Market Regional Outlook

The global vacation rental market size stood at USD 106.51 Billion in 2024 and is projected to reach USD 112.76 Billion in 2025, expanding to USD 188.42 Billion by 2034 at a CAGR of 5.87%. Regional distribution shows North America leading the market with 37% share, followed closely by Europe at 34%. Asia-Pacific captures 23% of the overall market, while Middle East & Africa represent the remaining 6%. Each region has distinct demand drivers, cultural influences, and tourism flows that shape the performance of the vacation rental sector.

North America

North America continues to dominate the vacation rental market with a large number of urban and leisure travelers adopting alternative stays. About 42% of travelers in the region prefer vacation rentals over hotels for affordability and flexibility. In 2025, North America is expected to account for USD 41.72 Billion, representing 37% of the global market. Strong digital adoption, demand for family vacation homes, and popularity of coastal and mountain rentals contribute to this region’s growth trajectory.

North America - Major Dominant Countries in the Vacation Rental Market

• United States led North America with a market size of USD 28.35 Billion in 2025, holding 68% share, expected to grow at a CAGR of 6.0% due to urban tourism and coastal leisure demand.
• Canada accounted for USD 8.21 Billion in 2025, representing 19.7% share, with strong growth from nature tourism and cabin stays.
• Mexico reached USD 5.16 Billion in 2025, 12.3% share, driven by beach house rentals and increasing inbound tourism.

Europe

Europe remains a key contributor to the vacation rental industry, supported by high intra-regional travel and cultural tourism. Around 46% of European travelers choose vacation rentals for extended family stays. Europe is projected to record USD 38.34 Billion in 2025, representing 34% share of the global market. Demand for villas, cottages, and chalets remains particularly strong across Mediterranean and alpine regions, supported by seasonal travel and heritage tourism trends.

Europe - Major Dominant Countries in the Vacation Rental Market

• France accounted for USD 10.53 Billion in 2025, holding 27.5% share, driven by holiday cottages and chalets.
• Germany reached USD 9.40 Billion in 2025, capturing 24.5% share, supported by urban and countryside tourism.
• Spain recorded USD 8.41 Billion in 2025, 21.9% share, with strong demand for coastal villas and beach houses.

Asia-Pacific

Asia-Pacific shows dynamic growth in the vacation rental market, with a rising middle-class population and expanding tourism sector. About 39% of millennials in the region prefer private rentals for affordability and group travel. Asia-Pacific is estimated to generate USD 25.93 Billion in 2025, representing 23% of the total market. Beach houses, villas, and short-term urban apartments are the fastest growing categories, fueled by increasing domestic tourism and international inflows to emerging destinations.

Asia-Pacific - Major Dominant Countries in the Vacation Rental Market

• China accounted for USD 9.07 Billion in 2025, representing 35% share, with strong demand for urban apartments and nightly rentals.
• Japan generated USD 7.00 Billion in 2025, holding 27% share, driven by compact short-term rentals in cities and cultural tourism.
• India reached USD 5.44 Billion in 2025, 21% share, led by family vacation homes and long-stay corporate rentals.

Middle East & Africa

Middle East & Africa is steadily emerging as a vacation rental market, supported by luxury tourism in Gulf nations and cultural travel across Africa. Approximately 28% of international visitors to the region opt for vacation rentals for privacy and premium amenities. In 2025, this region is projected to record USD 6.76 Billion, representing 6% of the global market. Villas and luxury homes dominate the segment in the Middle East, while cottages and homestays attract demand in Africa.

Middle East & Africa - Major Dominant Countries in the Vacation Rental Market

• United Arab Emirates led with USD 2.23 Billion in 2025, accounting for 33% share, supported by premium villa demand and inbound tourism.
• South Africa recorded USD 1.96 Billion in 2025, representing 29% share, driven by eco-tourism and coastal rentals.
• Saudi Arabia accounted for USD 1.35 Billion in 2025, 20% share, fueled by religious and leisure tourism growth.

List of Key Vacation Rental Market Companies Profiled

Investment Analysis and Opportunities in Vacation Rental Market

Investments in the vacation rental market are growing rapidly, with over 64% of investors focusing on digital platforms that enhance booking efficiency and guest personalization. Approximately 41% of new investments are directed toward technology-driven solutions, such as AI-based pricing and customer engagement. Sustainability is also attracting attention, with 35% of properties investing in eco-friendly amenities to meet growing consumer demand, while 29% of investors are targeting smart home integration to improve operational efficiency. Regional opportunities are strong, with 38% of funding directed toward Asia-Pacific due to its rising travel population, while North America secures 33% of total investment. The expanding adoption of contactless check-ins, flexible cancellation policies, and mobile-based management systems is encouraging both institutional and private investors, strengthening the long-term growth potential of the vacation rental industry.

New Products Development

Innovation in the vacation rental market is transforming guest experiences, with 48% of companies launching smart technology-enabled rental properties, including keyless entries and smart energy systems. Nearly 42% of new product launches are focused on sustainability, offering eco-certified homes to attract environmentally conscious travelers. About 37% of operators have introduced bundled vacation packages with transport and leisure services included, creating added value for customers. Mobile-first platforms are also shaping development, with 55% of booking interactions now optimized for smartphones. Personalization features such as AI-driven recommendations, adopted by 46% of service providers, are enhancing customer loyalty. Additionally, over 31% of hosts are offering luxury upgrades and premium concierge services, creating differentiation in competitive markets. This continuous wave of innovation is reshaping consumer expectations and setting new industry benchmarks.

Recent Developments

• Airbnb’s Sustainability Push: In 2024, Airbnb introduced eco-friendly property categories, with 27% of listed homes now showcasing sustainable certifications, attracting environmentally conscious travelers globally.
• Booking Holdings Expansion: Booking Holdings strengthened its short-term rental network in Europe, expanding coverage by 19%, and added new integrated payment systems for ease of transactions.
• Expedia Technology Upgrade: Expedia launched an AI-based rental pricing tool in 2024, enabling hosts to improve occupancy, with adoption rates reaching 36% among listed properties.
• TripAdvisor Experience Bundling: TripAdvisor introduced bundled vacation rental and activity packages, with early adoption rates of 22% in coastal markets, enhancing cross-selling potential.
• Wyndham Destinations Growth: Wyndham expanded its luxury villa rental portfolio, increasing its premium rental listings by 18% in 2024 to capture high-spending customer segments.

Report Coverage

The vacation rental market report provides a comprehensive assessment through SWOT analysis, covering strengths, weaknesses, opportunities, and threats influencing global industry performance. Strengths include rising adoption of digital booking platforms, accounting for nearly 72% of total bookings, along with a strong demand for short-term rentals, which represent 49% of global stays. Weaknesses primarily lie in regulatory challenges, where 39% of operators face compliance restrictions, and seasonal fluctuations impacting occupancy, with 44% decline during off-peak periods. Opportunities are abundant, with 63% of tourists preferring flexible stays and 52% of business travelers shifting to vacation rentals due to cost advantages. Moreover, eco-friendly demand is growing, with 55% of customers preferring sustainable rental properties. Threats arise from increasing competition, where over 33% of operators face pricing pressures, and trust concerns, with 31% of travelers citing verification issues. Regional analysis highlights North America with 37% share, Europe at 34%, Asia-Pacific at 23%, and Middle East & Africa at 6%. The report also profiles top companies like Airbnb, Booking Holdings, Expedia, and Wyndham, which together account for a dominant share. Overall, this coverage emphasizes technological innovation, sustainability, and evolving traveler preferences as key market drivers shaping future opportunities.