Greetings Owners, and welcome back to Rev Up!
This week, we would like to cover two important topics that we think are worth diving into: what is the current pulse of the vacation rental market, and how does Brett/Robinson’s 2023 look so far when compared to The Market?
We spend a lot of time looking at not only what we see going on with the units on our program, but what’s going on in The Market. In addition to looking at a lot of third-party data, we keep a close finger on the pulse of the vacation rental market in the news.
We recently came across this article from Business Insider, which is a good 2 minute read. We know you’re busy, so if you do not have time to read it, we’re happy to give you the summary: rental revenue in 2023 is down vs. the past two years for most properties, and by a fair amount. In particular, units that are not at an extreme – ultra luxury properties, or the cheapest rooms in town – are seeing the largest declines in 2023.
What does this mean for Brett/Robinson? Well, it means we are not able to charge as much in 2023 as we were able to charge in 2021 or 2022, unfortunately. Our ADR has fallen as we work to pull in additional room nights with the lower demand we have seen. We expected 2023 to compete with 2022, and for most of our properties to have their second-best revenue year ever, but this has unfortunately not been how the year has materialized.
The chart below shows our Brett/Robinson adjusted occupancy pace for the entire month of June vs. the Market’s adjusted occupancy pace for the entire month of June from January 1st, 2023 through where June ended up finishing:
The chart shows that our adjusted occupancy for the month of June paced slower through May 14, 2023, where we overtook the market, and pulled away across the final 6 weeks of bookings for June. The result was 8% more adjusted occupancy for Brett/Robinson than the rest of the Gulf Shores/Orange beach rental market, and we were able to achieve this with 8% more ADR than the market.
While this year has been tough in comparison to the past two years, we believe that we have the right strategy in place for the Summer. In a year where demand is down, our strategy to maximize occupancy at the best possible rates has helped us Rev Up 19% more rental revenue for Brett/Robinson owners than other owners in the market for June!