Urban Flights: Rural Short-Term Rental Markets Outperform In The Coronavirus Crisis

As we observed in our previous coverage on the impact of COVID-19 on short-term rental (STR) markets in countries around the world, things are not looking too good. In our previous reports, we covered countries and states as a whole to show how STR markets overall were reacting to the pandemic. In this report, we want to highlight specific cities that have managed to remain resilient in the face of the coronavirus crisis or have even benefited in one way or another from the pandemic that has been devastating the majority of STR markets around the world. In this piece, we use our short-term rental analytics to assess different areas who have shown growth during this time of such uncertainty in the travel industry. What we found from this data was that the majority of STR markets which grew during this time of instability were smaller, non-urban areas which could provide a getaway from COVID-19 hotspots in urban cities.

Top Performing Cities Based on Occupancy Rate

In order to assess which cities were performing well during this crisis, we compared average occupancy rates in the first half of 2020 (Weeks 1-6) with the second half of 2020 (Weeks 7-12). We chose cities which had at least 20 available listings per day and sorted the cities by growth rate during this time (Figure 1). As we see below, these are the 50 top-performing cities across the US with respect to growth in STR occupancy rates this year.

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CITY	STATE	Avg. OCC Week 1-6	Avg. OCC Week 7-12	% Growth
Concan	Texas	7	21	208
Geyserville	California	8	21	162
Hunt	Texas	4	10	131
Bridgehampton	New York	3	7	123
Peaks Island	Maine	5	11	115
Valdez	Alaska	12	25	110
Placida	Florida	15	31	109
North Redington Beach	Florida	14	29	107
Spring Branch	Texas	14	28	103
Spicewood	Texas	14	28	102
Westmont	Illinois	14	29	101
Rodanthe	North Carolina	3	7	101
Ingram	Texas	6	11	99
Lakeville	Connecticut	8	16	97
Lockhart	Texas	18	36	96
Santa Rosa Beach	Florida	12	23	95
Steinhatchee	Florida	7	14	90
Surfside Beach	Texas	15	28	89
Shelter Island Heights	New York	6	12	86
Indian Wells	California	12	21	85
Fairburn	Georgia	13	24	79
Boca Grande	Florida	10	17	78
Larkspur	California	25	44	74
Kent	Connecticut	24	41	74
Lexington	Massachusetts	19	33	74
Ogunquit	Maine	7	11	71
Franklin	Maine	8	13	71
Ocean View	Delaware	4	6	69
Springville	Utah	20	33	69
Florence	Massachusetts	28	47	69
Port Aransas	Texas	11	18	68
Branford	Connecticut	16	27	68
Beaumont	California	17	29	66
Terlingua	Texas	33	54	66
East Quogue	New York	8	13	65
Burnet	Texas	13	21	63
Waveland	Mississippi	31	50	63
Greenbank	Washington	19	31	62
League City	Texas	32	51	59
Palisade	Colorado	10	16	58
Bay St Louis	Mississippi	25	39	58
Deer Harbor	Washington	4	7	57
Nice	California	7	12	56
Kodiak	Alaska	10	15	55
Farmington	Utah	28	43	55
Newport Coast	California	7	11	54
Miramar Beach	Florida	15	23	54
Uvalde	Texas	21	32	54
Hull	Massachusetts	7	11	52
Aransas Pass	Texas	20	30	52

Figure 1: 50 Top-performing cities in the US by occupancy rate.

In Figure 1 above, we see how the top 5 US cities in the above table functioned in terms of OCC over time in 2020. As we see, Concan, Texas, performed extremely well under these conditions. From the first half to the second half of 2020, the occupancy rate for Concan’s STR market grew by 208%. During this time, supply for the STR market dropped by 22%, while both demand and gross revenue increased significantly. Demand grew by 125% and gross revenue rose by a whopping 231% in the second half of 2020. Our second highest performer, Geyserville, California, saw a growth of 162% in OCC from the first half to the second half of 2020. Geyserville actually saw a 6% decrease in STR supply during this time, but had an increase of demand of 147% and thus saw an overall increase of 80% in gross revenues. Hunt, Texas was the third highest performer in terms of short-term rental occupancy rates. From the first half to the second half of 2020, OCC rose by 131%. Supply remained relatively stable during this time, while demand and gross revenues increased significantly. Demand for STRs in Hunt grew by 130% and gross revenue increased by 181% in the second half of 2020.

Top 10 Performing Cities Within Top 10 Performing States

We also looked at the entire list of top-performing cities and analyzed at all cities which had a growth of over 50% from the first half to the second half of 2020 with respect to occupancy rates. Within this data, we grouped the cities by states and came up with a list of 8 top-performing states, and the 5 top-performing cities within each of these states. This data is visualized below. 

California

In California, we see that the top cities with the highest growth in OCC were mostly non-urban cities (Figure 2 ). This data suggests that Californians are leaving urban centers in lieu of more rural hideouts during this crisis. This tells us that there are specific emerging STR markets with the potential to grow immensely despite the coronavirus crisis. Geyserville, a small rural city in Northern California, was the top-performing city in California and had the second highest growth of STR OCC in the US. Geyserville, California, had a growth of 162% in OCC from the first half to the second half of 2020. Geyserville actually saw a 6% decrease in supply during this time, but had an increase of demand of 147% and thus saw an overall increase of 80% in gross revenues. The second highest performing city in California was Indian Wells, with an 85% increase in STR OCC from the first to the second half of 2020. While supply remained constant throughout this time, demand rose by 84% and gross revenues increased 161%. Overall, these non-urban STR markets within California flourished in a time of pandemic-related economic crisis. 

Figure 2: Top 5 performing cities in California with respect to percent growth in occupancy rates in 2020.

Connecticut

Short-term rental markets in rural cities around Connecticut saw massive gains in the second half of 2020. These cities in Connecticut add to the narrative of mostly rural STR markets outperforming urban STR markets in this current climate. Lakeville saw the highest growth in OCC in the second half of 2020, with an increase of 97%. Supply of STRs in Lakeville dropped by 10% during this time, but demand grew by 81% and gross revenue by 115%. The city of Kent saw the second highest growth in OCC in Connecticut, with a 74% increase in the second half of 2020. Supply did not change during this time period, but demand increased by 72% and gross revenue grew by 27%. Branford had the third highest growth in OCC in Connecticut with a 68% in STR occupancy rates from the first half to the second half of 2020. Supply dropped 8% during this time, but demand grew by 56% and gross revenue increased 111%. The key performance indicators (KPIs) in the STR market of these cities not only managed to stay afloat during a situation which has managed to devastate STR markets around the world, but have actually benefited massively from the situation. 

Figure 3: Top 5 performing cities in Connecticut with respect to percent growth in occupancy rates in 2020.

Florida

Unsurprisingly, smaller waterfront cities in Florida rose to the top in the middle of the coronavirus pandemic. As we can see from Figure 4 below, all of the top 5 performing cities with respect to STR markets are cities by the water. As measures become stricter and the pandemic plagues urban cities, the data shows that Floridians are seeking shelter in smaller cities by the water and away from population dense areas. Placida had the highest growth rate of OCC in the vacation rental market, with a 109% increase in the second half of 2020. Surprisingly, supply of STRs in Placida dropped by 33% during this time period, but demand grew by 49% and gross revenues increased by 52%. North Redington Beach had the second highest growth of STR occupancy rates in Florida, with a 107% increase in the second half of 2020. While supply in North Redington Beach dropped by 32% from the first half to the second half of 2020, demand for the city’s STR market grew by 40% and gross revenue by 37%. Santa Rosa Beach, Florida also did exceptionally well, with a 95% increase in OCC in the second half of 2020. Supply of STRs dropped by 11% during this time period, but demand rose by 71% and gross revenue grew by 104%. Here, the data clearly shows that vacation rental guests have been flocking to Florida’s waterfront cities to escape the coronavirus pandemic. 

Figure 4: Top 10 performing cities in Florida with respect to percent growth in occupancy rates in 2020.

Georgia

The short-term rental market in Georgia also saw massive growth in occupancy rates in smaller cities. The city of Fairburn had the highest growth in short-term rental OCC in all of Georgia. From the first half to the second half of 2020, Fairburn’s STR OCC increased by 79%. During this time, supply of vacation rentals increased by 4%, demand by 85% and gross revenue by 53%. St. Simons Island, an island off the coast of Georgia, came in second within the state, with a growth of 50% in vacation rental occupancy rates in the second half of 2020. Supply of STRs dropped by 19% during this time period, but demand grew by 23% and gross revenues increased by 33%. Pooler, Georgia also saw immense growth in the STR market in the second half of 2020. With an increase of 42% in occupancy rates in their STR market, Pooler saw the third highest growth in all of Georgia in 2020. STR supply increased by 9% during this time period, and demand grew by 62%. Due to growth in the other KPIs this year, gross revenues for the STR market in Pooler increased by a whopping 108%, the second highest increase in gross revenue observed in the US. Georgia was an anomaly in our data, since the highest growth in STR occupancy rates were seen in areas that weren’t strictly rural. Both Fairburn and Pooler, for example, are mostly urban cities. While the majority of growth we have observed so far in the STR market have been in non-urban areas, it is important to note that there are exceptions to this and Georgia is a prime example of that. 

Figure 5: Top 5 performing cities in Georgia with respect to percent growth in occupancy rates in 2020.

Massachusetts

The Massachusetts STR market follows the same narrative we’ve seen in most of the previous states above. In Figure 6 below, we again observe high growth in STR markets in smaller cities around Massachusetts. In Lexington, a suburban city, there was a 74% growth of OCC in vacation rentals in the second half of 2020. During this time, there was a 7% increase in STR supply in Lexington. Demand grew by a staggering 84% and gross revenue by 30%. In Florence, Massachusetts, STR occupancy rates increased 69% from the first half of 2020 to the second half. During this time period, supply dropped by 11%, while was up 49% and gross revenues grew by 15%. Hull, a waterfront city, had the third highest growth of STR occupancy rates in Massachusetts in the second half of 2020. Occupancy rates for the STR market grew by 52% from the first half to the second half of 2020. During this time period, supply was down by 2%, but demand grew by 48% and gross revenues increased by 50%. Overall, these smaller, non-urban STR markets within Massachusetts flourished in a time of economic downfall and crisis. 

Figure 6: Top 5 performing cities in Massachusetts with respect to percent growth in occupancy rates in 2020.

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Mississippi

Mississippi’s STR market also saw massive growth in occupancy rates in smaller non-urban cities. Waveland, a coastal city, had the highest growth of STR occupancy rate in all of Mississippi. From the first half to the second half of 2020, Waveland saw a growth of 63% in short-term rental OCC. Although supply of STRs in the beach front city dropped by 14%, both demand and gross revenues had significant growth. Demand for STRs during this time grew by 41% and overall gross revenue increased by 33%. Bay St. Louis, a quaint seaside city, came in second with a OCC growth of 58% in the second half of 2020. From the first half to the second half of 2020, STR supply dropped by 8% in Bay St. Louis, while there was growth in both demand and gross revenue. During this time, demand for STRs grew by 46% and gross revenue increased a whopping 55%. Natchez, a city set on the Mississippi River also had high growth with respect to KPIs in the short-term rental market. There was a 47% increase in STR occupancy rates in Natchez in the second half of 2020. Surprisingly, while demand also grew by 46%, supply remained almost constant and revenues dropped slightly from the first to the second half of 2020. During this time gross revenues in the STR market of Natchez dropped by 6%. As we see from these numbers above, the Mississippi STR market has flourished in areas by the water and away from bigger cities. 

Figure 7: Top 5 performing cities in Mississippi with respect to percent growth in occupancy rates in 2020.

New York

From Figure 8 below, we see that smaller cities in New York have seen massive growth in STR occupancy rates in the second half of 2020. Bridgehampton, a small hamlet in the state of New York, saw the greatest growth from the first half of 2020 to the second half, with an increase of 123% in STR occupancy rates. During this time, STR supply in Bridgehampton remained stable, while demand increased by 117%. Bridgeampton had an increase of 132% in gross revenues in the second half of 2020. Shelter Island Heights also saw a huge growth spurt in STR occupancy rates in 2020. There was a 86% increase in vacation rental occupancy rates from the first half of 2020 to the second half. During this time in Shelter Island Heights, New York, STR supply grew by 6% while demand grew by 103% and gross revenues increased a whopping 157%. In third place was East Quogue, a small waterfront hamlet in New York state, which saw a growth of 65% in STR occupancy rates from the first half to the second half of 2020. During this time, STR supply in East Quogue saw a growth of 9% while demand grew by 84% and gross revenues increased by 63%. These numbers above suggest that New Yorkers, in times of crisis, are opting for getaways in smaller hamlets far from bigger cities.

Figure 8: Top 5 performing cities in New York with respect to percent growth in occupancy rates in 2020.

Texas

The short-term rental market in Texas also saw massive growth in occupancy rates in rural cities. Concan is a small city by the Frio River in Texas and saw the highest growth of STR occupancy rates in the second half of 2020. From the first half to the second half of this year, OCC grew by 208% – the highest growth of OCC in the entire United States STR market. During this time, supply for the STR market dropped by 22%, while both demand and gross revenue increased significantly. Demand grew by 125% and gross revenue rose by a whopping 231% in the second half of 2020. Hunt, a small city along the Guadalupe River, came in second within the state of Texas and third within the entire US. From the first half to the second half of 2020, OCC rose by 131%. Supply remained relatively stable during this time, while demand and gross revenues increased significantly. Demand for STRs in Hunt grew by 130% and gross revenue increased by 181% in the second half of 2020. Spring Branch, another waterfront city, was the third highest growing city in Texas, with an increase of 103% in STR occupancy rates in the second half of 2020. From the first half to the second half of 2020, supply of STRs in Spring Branch grew by 8%. During this time, demand rose a whopping 116% and gross revenues saw an increase of 90%. Non-urban, waterfront STRs in Texas flourished in the second half of 2020, demonstrating resilience of specific markets through times of widespread devastation. 

Figure 9: Top 5 performing cities in Texas with respect to percent growth in occupancy rates in 2020.

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Conclusion

Our KPI data on top-performing US cities showed that, for the most part, non-urban short-term rental markets have been booming during this crisis. The majority of cities showing growth of KPIs of STR markets were in smaller, non-urban cities. This data shows that people are fleeing urban cities in favor of hideouts in hamlets, smaller cities or waterfront towns. The spread of coronavirus has essentially caused urban flight to small, rural STR markets. We will continue to monitor STR markets in cities and regions that show resilience in the face of the coronavirus pandemic. If you have any inquiries on how STR markets have been responding to the spread of COVID-19, please feel free to reach out to us.