Sean Malin and his friends, like many Americans this summer, were desperate to get the heck out of (quarantine) dodge despite the coronavirus pandemic.
"We needed to vacation somewhere," Malin, 28, told USA TODAY.
But they didn't want to go just anywhere over July 4 weekend. They were looking for safety and seclusion, but also weren't willing to drive more than two or three hours away.
The group of five crammed into a Toyota Camry and wound through narrow uphill roads to reach their Airbnb in Sugarloaf, California, outside of Big Bear. Perhaps it was too secluded, considering they had no WiFi signal there and were given an incorrect address.
Still, Malin managed to enjoy himself given the circumstances.
"It wasn't paradise unfortunately, but we enjoyed the company and the natural surroundings were beautiful," Malin, of Canyon Country, California, told USA TODAY. "It sufficed."
Their choice mirrors a common trend in the industry as travelers have sought out socially-distanced excursions within half a day's drive from home. Some are also opting to stay in private homes where they can prepare their own food and won't come into contact with strangers from outside their quarantine bubble.
And traditional hotels have paid the price, literally. For the week ending Aug. 15, U.S. weekly hotel occupancy occupancy was down 30% from the same period in 2019, according to data firm STR.
The news is not all bad for hotels: occupancy hit above 50% for the first time since March and occupancy has ticked up for 17 of the last 18 weeks, though growth in demand for rooms has slowed.
Still, short-term rentals have bounced back faster since the coronavirus pandemic decimated travel interest in March. They have also benefited from a weakened business travel environment and shift in travel preferences to more rural and remote areas where guests can opt for longer stays.
Which is safer: A hotel or short-term rental?
Both hotels and short-term rentals have announced extensive cleaning measures and social distancing procedures to reassure cautious travelers it's safe to stay there during COVID-19.
Augusto Amorim, 41, always stays at hotels when he travels.
"Especially under the current circumstances, I'd expect a hotel to be cleaner," the market researcher of Detroit said. "I think that chains like Hilton, Accor, SPG etc. have more strict rules in place and that they're holding each property accountable."
Still, when he stayed at the Swissotel in Chicago over the July 4 weekend, he bought his own supplies and cleaned the entire room anyway.
James Alexander, 32, rented a car with his boyfriend and drove from New York to the Berkshires the week after July 4. They stayed at boutique hotel Seven Hills Inn in Lenox, Massachusetts, in an effort to support small businesses and also because they weren't sure if they'd get refunds on anything if they pre-paid.
"We were very impressed with the social distancing and cleanliness measures they had in place," Alexander told USA TODAY.
But Dr. Keith Armitage, a professor at the Case Western School of Medicine in Cleveland, told the USA TODAY Network earlier this summer that a a home rental might actually be safer. "The ideal situation would be an Airbnb or a rental that had been empty for a couple of days," he said.
Regardless of which is safer, the data is clear. Short-term rentals are more popular right now.
'An unequal impact on hotel occupancy'
Hotels have traditionally had higher occupancy rates than short-term rentals, according to a global analysis of 27 markets around the world from January 2019 through June 2020. Data firms STR and AirDNA, which analyzes short-term rental trends, worked together on the analysis.
But then the pandemic struck. Hotel occupancy fell 77.3% at the end of March 2020 compared to the year prior. Rental occupancy fared better, dipping 45.1% for studio and one-bedroom rentals and 46.2% for two- or more bedroom rentals.
The crisis for hotels was two-fold. "First, as quarantine restrictions, social distancing and economic troubles took hold, many business meetings, conferences, and other events were canceled," authors Will Sanford, research analyst at STR, and Dillon DuBois, product marketing manager at AirDNA, wrote. "Given the hotel sector’s reliance on demand from group and business travel, this had an unequal impact on hotel occupancy."
Short-term rentals initially saw a dip in bookings, plummeting 47% from more than 2.3 million in January 2020 to 1.2 million by April. Bookings crept up in the following months, which researchers attribute to several factors:
- Short-term rentals could make social distancing more feasible, with multiple bedroom-units and whole homes to rent
- More homes are located in rural and/or remote vacation markets, a boon for travelers seeking to leave urban areas amid spiking COVID-19 cases
- Most have full-service amenities, including kitchens, making longer-term stays more convenient
An average length of guest stay has ticked up 58% during the pandemic.
This thinking played out earlier in the pandemic. Omer Rabin, property management software company Guesty's managing director of the Americas, told USA TODAY earlier this year about the increasing length of stay trend. Historically, the average length of stay was consistent around 3.6 to 4.2 days. That average shot up to an unprecedented eight days at the end of March.
From June 1 to Aug. 24, the average length of stay in the U.S. was 4.24 days, a 19% increase from the same time last year. The average length of stay peaked the last week of July at 7.5 days.
When will hotels recover?
U.S. hotel demand likely won’t see a full recovery until 2023, according to a forecast from STR and consultant Tourism Economics. The industry is also facing a historic wave of foreclosures, according to a report from trade group American Hotel & Lodging Association, which also noted that the number of delinquent hotel loans is higher now than even during the Great Recession of 2007-2009. AHLA is pushing for legislation in Congress to further aid in the ailing industry.
STR and Tourism Economics recently said they expect average hotel occupancy of 40% this year, slowly climbing to 52% in 2021. That’s down from a healthy 66% in 2019.
Hilton CEO Chris Nassetta said during the company's second-quarter earnings call earlier this month that he expected Hilton hotels to be in the 45% to 50% occupancy range, and that summer leisure travel will bleed into fall given that kids won't be going back to school or will be doing so virtually. Marriott CEO Arne Sorenson said he was "optimistic" about travel's recovery.
The coronavirus will weigh heavily on travel through at least the first quarter of 2021, said Adam Sacks, the president of Tourism Economics. Sacks expects a cautious recovery in the first half of next year, with stronger growth in travel the second half.
Hotel revenue will take even longer to recover, returning to normal levels in 2024, Tourism Economics and STR said. Travelers want deals, and mid-range hotels are recovering more quickly than luxury brands.
But for now, it's up to guests to decide if they can stomach potentially uncomfortable encounters with fellow travelers.
Vacationer Mike Naypauer and his family mostly ordered food through DoorDash and ate in their room at the Hilton Oceanfront in Virginia Beach, Virginia, earlier this summer, but also did some outdoor dining. They went to the beach and pool when it wasn't crowded; elevators were a spot where they encountered close contact with others, and they had to avoid the rooftop pool.
“It looked like one of those viral videos you see with way too many people," Naypauer said.
The elevators made the family feel particularly uneasy. "The hotel had rules of a max of four people and we were a family of four so in theory we should have never shared an elevator with anyone but were rarely alone," Naypauer said. "We didn't mind so much if it was one or two extras and they were wearing a mask, but at times it got a bit crowded and you had some folks not wearing masks even though it was the rule. When we were coming on and noticed crowds, we actually took the stairs up 17 flights."
Beach towns have been busier
U.S. hotels have been busier this summer in beach locations like Norfolk, Virginia.
According to STR data, the only area to hit more than a 60% occupancy level the week ending Aug. 15 was Norfolk/Virginia Beach, Virginia, at 65.3%. Some of the lowest occupancy levels occurred in Orlando, Florida (29.9%) and Oahu Island, Hawaii (22.8%), where Gov. David Ige recently extended the ban on out-of-state tourists through September and reinstated the inter-island quarantine rule.
Naypauer, along with his wife and 20-year-old and 14-year-old children of Broadview Heights, Ohio, intended to go to Montreal but still wanted to do a family trip but began to run out of options before settling on Virginia Beach.
“We were going to go out West but risked going through too many states,” the 49-year-old accounting manager said. “We were going to go to Florida and South Carolina but as those states became hotspots, decided not to. We then had picked Lake Placid, New York, but when New York placed a ban on people from states with rising cases, [we] had to pivot once again.”
Even despite their advance planning, the Naypauers couldn't completely escape crowds. "We did definitely observe large groups of people hanging out very close together," Naypauer said. "I can't imagine in each case it was just one bubble family."
Contributing: The Associated Press
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