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Using Data to See if the AirbnBUST is Really Happening Braydon Ross | Episode 4 | STR Data Lab™ by AirDNA

We’re here to answer the question everyone is asking, is the AirbnBUST really happening? Are bookings down? What about occupancy? How do hotels and STRs size up to each other? Is revenue management actually important? This month, VP of Research, Jamie Lane joins VP of Marketing, Mariah Kamei to provide data-driven answers to these questions and more. 

With 26.6% more nights stayed than in the same month in 2019. September was the strongest month for demand growth compared to 2019 levels since the start of the pandemic. Average daily rates also continued to grow, 5.6% YoY. Occupancy only declined 1.2% YoY to 58.1% but is up +11.1% vs. 2019. And available listings reached 1.38 million – up 23.2% YoY and +8.7% vs. 2019. 

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Read the Full US Market Review: 

https://www.airdna.co/blog/airdna-market-review-us-september-2022

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Read the Europe Market Review: 

https://www.airdna.co/blog/airdna-market-review-europe-september-2022

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Read “How to Finance Your Vacation Rental: A Step-by-Step Guide”: 

https://www.airdna.co/blog/how-to-finance-your-vacation-rental

Listen On:

Transcript

00:00:12:17 - 00:00:32:12

Speaker 1

Guys. We're going to run through the monthly numbers today. We're going to show you what the trends are over time. Jamie, before we get started again, just acknowledging that I look like I'm ready for a red carpet event. Big shout out to Matt Landau. We are super excited to see you next week at your premiere of Home Runners.

00:00:32:15 - 00:00:55:27

Speaker 1

So shout out to Matt. And then before we get into those September numbers, I just want to say, like it's been it's been a hell of a week to be an Airbnb host. We're all over the news, man. It's like everywhere. Hashtag. Airbnb bust. I love this. I love this. So I think you I think you're a pretty avid Twitter tweeter.

00:00:55:27 - 00:01:30:10

Speaker 1

Tweeter. Is that a thing? It is now. But loved this from Texas runner DFW. The Airbnb bust is upon us. I was like, Oh, yes, we've reached the cultural zeitgeist. That was shortly followed up with a lovely BuzzFeed article that had, you know, made some made some bold claims. Jamie And part of what our business is on this podcast is to take a look at bold claims and uncover the truth behind them, dispel some myths.

00:01:30:20 - 00:01:44:04

Speaker 1

So I thought it would be fun to start the podcast by talking a little bit about some of the statements this piece made and get your hot take on them. Maybe do a little myth busting as they say. What do you think?

00:01:44:26 - 00:01:46:00

Speaker 2

Sounds great. Let's do it.

00:01:46:00 - 00:02:07:23

Speaker 1

Let's do it. I love it. So for folks who maybe didn't read the article, there was a lot of banter around things like, is the rent too damn high? Are your rates too high? Are your fees too high? Shout out to Airbnb cleaning fees. That was in the article, of course, as well. But it really started off with this very bold statement.

00:02:07:23 - 00:02:23:19

Speaker 1

It actually came from Insider, Business Insider, that is. That said, bookings were down for the summer. So Jamie Lane we talk a lot about bookings here on this podcast and elsewhere. Are they down? Is it true? What's what's happening with bookings?

00:02:24:19 - 00:02:53:12

Speaker 2

Yeah, I mean, generally bookings are not down. But if you looked at it and let's call it bookings per available listing or occupancy, occupancy was down and we were down pretty strongly off of the 2021 highs. We've talked about that extensively and together we talked through it on our review and their supply’s up and we've got roughly 23% more listings in the US today than we had last year.

00:02:53:23 - 00:03:43:28

Speaker 2

Right. You know, actual bookings are significantly higher than last year as well. So in September, demand was up 24%. Throughout the summer it was up well north of 20% year over year. And we're well above 2019 levels as well. So are bookings down? No. Is occupancy down? Absolutely. And I think that's a key point when we look at sort of the anecdotal evidence that that tweet sort of pulled from if you go out and pull in the thousand Airbnb hosts, each one of them is going to say, yeah, my occupancy was down, bookings were down this summer, but if you take them all in aggregate and then compare them and to

00:03:43:28 - 00:04:13:03

Speaker 2

the same group from or a different group or every host from last year, we're going to see there's way more hosts out there. Right. But I think the the key takeaway for people is demand is not down. There's more interest than ever in staying in short term rentals today. And we've seen no pullback, whether it's in historical demand, what's happened this summer or what we're looking at out into the future.

00:04:13:11 - 00:04:52:24

Speaker 2

In September, this month, or last month, we saw 19% more nights booked for future travel than we saw in September of 2021. So a lot of momentum as we head into the fall. And then we also and we track Airbnb globally for a lot of our financial services clients. Yes. And our expectations for this quarter, Airbnb is going to report their numbers in about a week and a half is that there is 104 million nights booked in the third quarter and that's up 31% year over year.

00:04:52:25 - 00:05:06:06

Speaker 2

So I do think it's going to be a blockbuster reporting quarterly earnings for Airbnb. This quarter. Note that that is not financial advice and you should.

00:05:07:13 - 00:05:07:21

Speaker 1

Talk to your

00:05:07:21 - 00:05:10:06

Speaker 2

Financial advisor before making any decisions there.

00:05:10:13 - 00:05:30:14

Speaker 1

Thank you. Thank you. Yes, our lawyer. Thanks you as well. Thanks, Mark. That was for you. We're not giving financial advice on this podcast. Good call. Yeah, I think it's wonderful. I think. Yeah. You know, we'll circle back in about ten days and Airbnb has an opportunity to sort of set the record straight on a lot of these things.

00:05:31:23 - 00:05:44:21

Speaker 1

And Jamie, I think you hinted at this a couple of different places, but a lot can impact bookings, as you just mentioned. And hey, I think, you know, the big thing to note here is, right, like we are in a seasonal business, there are highs and there are lows.

00:05:45:15 - 00:06:26:23

Speaker 2

Yeah. So we track obviously every booking, every listing around the country and and we're tracking 1.38 million listings in the US there is 150,000 of those that didn't get a booking in September. So not everyone gets a booking every month. And then also to note there that that's actually a really good number comparably. If we look back through history and that sort of points to the sort of highs and occupancies that we're at, yes, occupancy is down, but it's 11% higher than it was in 2019.

00:06:26:23 - 00:06:54:02

Speaker 2

So comparatively, the industry is still doing really well. But to your point about seasonality, so in September, overall demand was down 20% from the highs in July. So if you're thinking about like from the summer to today, like it looks like bookings are down. I think you've got to look at it in terms of seasonality. And and yes, that that's going to happen.

00:06:54:08 - 00:07:23:04

Speaker 2

We expected that to happen and it's going to drop even further. Right. So if you're in and in looking at a lot of those comments and thinking through and some of the strategies that could maybe change those booking trends for those hosts, it's one you've got to be revenue managing. If you're keeping your rates at the high levels that you had gotten in July, you're not going to get any bookings.

00:07:23:04 - 00:07:49:28

Speaker 2

That's a clear way that you're going to go from 100% occupancy down to 0% really quickly. As demand adjusts, guests are going to expect to pay less. And you've got to sort of meet those guests expectations there and adjust your rates down. And I've been an Airbnb host and I know and if you adjust your rate to the right price, you're going to start getting bookings again.

00:07:50:24 - 00:08:07:18

Speaker 1

I love that. That's such great advice. And yeah, I think that's why it's so important to contextualize where you were a year ago back in 2019. I think we'll talk a little bit about why you think that's a really great place to sort of index off of in terms of performance just because of the outliers of 2020 and 21.

00:08:08:26 - 00:08:34:06

Speaker 1

But to your point, yeah, like folks like it's not you can't necessarily blame macro trends all the time for slow bookings or occupancy being below your standard. You really have to run your own race here, but also be very conscious of what that might be and how it impacts your ADR. And then also what was great about this article because it was obviously one of my favorite topics is they brought up the cleaning fees, the service fees.

00:08:34:06 - 00:08:52:24

Speaker 1

There were some really great not going to lie to you guys. There were some really great zingers out there on Twitter that I was like, Ooh, good zinger. On the cleaning fees. I know you and I were both most recently. I'm just going to shout out other podcast guys. It's just going to happen. We're both listening to you On with Kara Swisher today.

00:08:52:24 - 00:09:12:23

Speaker 1

She had Bryan, Bryan from Airbnb on the show and they also talked about cleaning fees. So Jamie, I think let's bust some myths here. Obviously, we've talked about this in previous content, but what sort of yeah, what does it mean to like all these fees? What's going on there, Sir?

00:09:12:23 - 00:09:33:28

Speaker 2

Yeah, and one, I think it's important to break down what those fees are. And one are you paying those fees whether you book at a hotel or a short term rental? Yes. So occupancy, taxes and those call it out a lot like whether, you know it or not, you're paying those at a hotel. You're paying in the short term rental.

00:09:34:18 - 00:10:06:04

Speaker 2

It wasn't always that short term rentals were collecting occupancy taxes. The fact that and it's pretty much automatic now that Airbnb is going to collect it on behalf of the host and remit it to the cities, is great. It sort of puts hotels and short term rentals on a much more fair playing field and making sure everyone's sort of paying for paying the taxes that it should when they travel to a destination, given all the destinations do to support travelers coming to their cities.

00:10:07:02 - 00:10:41:05

Speaker 2

The other is service fees. So Airbnb pays or charges like 12%-13% whether the guests paying that or the let's say the other OTA is or the hotel is and whether it's being rolled into the nightly rate or you're paying it through the fees to Expedia or Booking or are any of the others. And if you're booking through an OTA, you're more than likely paying a 10 to 20% OTA service fee, whether you know it or not.

00:10:41:25 - 00:11:06:17

Speaker 2

And that's sort of the take that any booking platform is going to take when you book through. Now, if you want to avoid those fees and this is what I do, sort of hot take hot, hot take from Jamie Lane. Find those listings and book them directly. So whether you do that at a hotel, find it on Expedia and book it on Hilton, or you find a short term rental.

00:11:07:04 - 00:11:29:22

Speaker 2

Google their name, find away. A lot of them now have ways to book. Direct a shout out to the Book Direct Show down in Miami this week. And that's a way that you can avoid that Airbnb service fee or really any service fees associated with that booking and make sure that all that money is going directly to the host.

00:11:30:22 - 00:11:53:00

Speaker 1

I love that. Yeah, that's a really good point. And Airbnb did just release an update on their city portal and I think that they mentioned that they collected 1.5 billion in local tourism taxes in 2021. So yeah, I think it's sort of that standardization of our business, of the industry. Those taxes do go back into governments and are super important for us.

00:11:53:27 - 00:12:28:21

Speaker 2

And the other way around cleaning fees. And yes, I'm listening to Bryan and Kara talk on the podcast. Right. It looks like there's a big update coming. I suspect it's in there. They're their winter update that they they'd sort of do two big updates on their platform of rolling out a way for all prices to look inclusive or at least show up inclusive of cleaning fees so that guests aren't surprised when they go to check out and see the $100/$200 cleaning fee as they're checking out.

00:12:29:01 - 00:13:01:03

Speaker 2

So with Airbnb doing a better job of making those fees apparent upfront and when they're searching dates, when they're searching properties, they're going to see a nightly rate inclusive of all the fees. I think that's going to be a big take, a huge step towards sort of changing the perception that it may be I'm Airbnb trying to hide those fees, get people for the bait and switch of, oh, this is $150 a night property, and then you go to check out.

00:13:01:03 - 00:13:11:05

Speaker 2

I'm like, How am I paying $300 a night? Which I think leads to a lot of a lot of sort of negative reaction that we see out there in the press and in the media.

00:13:11:17 - 00:13:25:26

Speaker 1

I love it. I love it. Yeah. Well, and I think there is an element of the people have spoken, right. So, yes, there are the fees, I think, you know, let's talk about in a minute. Just sort of dispel that myth that, you know, hotels may or may not be cheaper than short term rentals because I think you have some good data there.

00:13:26:14 - 00:13:42:09

Speaker 1

But one of the things that just strikes me right is that like, you know, it is important as hosts, I'm going to use my line. Jamie I know it's cheesy, but you got to keep the hospitable and hospitality folks, right? So like at the end of the BuzzFeed article, one woman said, you know what, I don't charge cleaning fees.

00:13:42:10 - 00:13:58:00

Speaker 1

Right? It's not worth it to me. It is a major differentiator for me. It gets me more bookings. It's part of her revenue management strategy not to do it. And so there is I think, an element of just like if if people are complaining about this, let's address it. Right. As hosts, yeah.

00:13:58:19 - 00:14:24:18

Speaker 2

That's actually an option that I'm many are taking up now and I think Airbnb is actually using if people are doing this sort of moving them up higher in the search. So there's the option you can include your cleaning fee and your rate. Yeah. And but also include service fees in your rate. So when the guest goes to check out, there may still be the occupancy tax at the end.

00:14:24:21 - 00:14:48:18

Speaker 2

Right. But they're essentially paying the rate that they saw and it's essentially including all the fees in that rate. So right now it's an option and I think they're just going to make it much clearer and a lot I've seen a lot of I'm talking to hosts that they're making that change and they're seeing a significant uptick in bookings after they make that change.

00:14:49:02 - 00:15:06:19

Speaker 1

I love it. Yeah, because you may just not be able to avoid now that it's in the cultural zeitgeist, it's on BuzzFeed people. It's officially jumped the shark, I guess is the word that I'll use the phrase that I'll use. Abby is going to have so much work with these show notes, Jamie. She's going to have to define everything for people.

00:15:08:10 - 00:15:11:04

Speaker 1

All right. So hotel costs versus short term rental costs.

00:15:11:12 - 00:15:51:14

Speaker 2

Oh, yeah. So that one. What’s happening there? So we just did a big study with STR, Smith Travel Research, confusingly. Yeah. And we’re the STR data lab, they are STR the company they track hotel performance. But one thing we did in this study was looking at like for like pricing for hotels and short term rentals. And we looked at a bunch of different consumer surveys and time after time on when people are asked why they choose short term rentals compared to hotels.

00:15:51:14 - 00:16:18:15

Speaker 2

Yeah, the top two reasons are location and price. So location obviously. I mean, if you're going to maybe the beach or the mountains and there's just not hotel options, you sort of move towards the short term rental option. That's in a lot of different places. That's your only option to stay. And then on price and objectively short term rentals are still cheaper than hotels.

00:16:19:06 - 00:16:50:00

Speaker 2

And how we sort of looked at that is looked at comparable cities and then comparable properties. So so for short term rentals, just looking at one bedroom studios and then comparing that to the average hotel room. And in urban areas today, the average short term rental is still 20% cheaper than the average hotel. And that really holds across all location types.

00:16:50:00 - 00:17:32:04

Speaker 2

Most cities, there are some sort of destinations you get to some remote mountain areas where getting a one bedroom home is, I think for all justifiably going to cost more than a one bedroom hotel room. Yeah. Given all the additional things you're going to get with that home, kitchen, living room, additional space, things like that. So I think on average we can dispel it as a myth busted, but there are going to be sort of certain caveats out there where, yeah, the hotel option might be cheaper, but comparably you're still getting more from that short term rental listing.

00:17:33:00 - 00:18:00:16

Speaker 1

Love it. All right, guys. Well, you heard it here. Some myths busted. Always it's always nice to kind of take some of the craziness in the media and bring us back down to earth. Thank you, Jamie. I'm full of mom jokes. I'm just going to keep going with them, speaking of some buzz getting created, you yourself again avid tweeter that you are posted a tweet earlier this week as well.

00:18:00:26 - 00:18:24:07

Speaker 1

It was about listing growth. I really love this. I think the feedback was tremendous. I think it was great to see people, you know, and just a good reminder for all of us, right? Like a good visual, a good graph can make a big difference for people in terms of their understanding of a problem. So it's great to get some some AirDNA love there, but also sparked a lot of healthy conversation.

00:18:24:07 - 00:18:29:20

Speaker 1

Right. So yeah. Jamie, talk to me about like what was what was your biggest surprise in the comments?

00:18:30:26 - 00:19:12:07

Speaker 2

Yeah, I know there is there is lots of comments. Admittedly, my first semi-viral tweet. Yes. So that was interesting to see sort of the fallout from that. A lot of media attention, a lot of media interest to sort of dove into what's happening there. But I think there's a few things to call out. And one is churn and sort of what that chart calls out is there is significant churn in the short term rental industry of people that bring listings on, pull them out for various reasons.

00:19:12:07 - 00:19:40:20

Speaker 2

Headline there was I think it was like 50%, 54% of listings on Airbnb today had been added since 2020, so added over the past two and a half years and maybe too long to sort of draw out into that tweet. But if you go back and look through like prior years, like, is that abnormal? Right. And it's actually some of the lowest levels it's ever been.

00:19:40:20 - 00:20:04:09

Speaker 2

And that's a combination of growth. So in 2012 to, let's say, 2018, 2019 and Airbnb was growing massively and from 2012 to 2016, they're essentially doubling their listings every year. So obviously a huge percent of their listings are going to be added in the past two and a half years. Yup,

00:20:04:18 - 00:20:05:05

Speaker 1

Good point.

00:20:05:27 - 00:20:42:18

Speaker 2

And churn today is not anywhere near or anywhere near what it's been in the past. We don't see significantly higher churn in the US. You do see it a bit globally, but that's all because of Airbnb pulling out of China and the impact there. Roughly 500,000 listings removed when they when they pulled out of that market. So the other sort of point there and I think a lot of people pulled out and it's interesting on this point, people called it out as a good thing and a bad thing.

00:20:42:18 - 00:21:19:03

Speaker 2

Even though the same numbers, sort of each person's individual take on the same trend is just how much listings have grown over the past few years. Yep. And, and if you go from today, maybe back to 2019, pre-pandemic supply has only grown about 20%. If you and put that as a headline, it can maybe sound alarming, right, that Airbnb supply has grown 20% or maybe put it in the context of that it was growing and 30, 40, 100% in prior years.

00:21:19:03 - 00:21:42:21

Speaker 2

It's like, oh, a three year period and they've only grown 20%. That's that's, that's not very scary. And a key point there is I think that and we are as an industry undersupplied right now I'm only adding 20% of listings given how much the industry has really grown. And we've sort of grown in the eyes of the consumer.

00:21:44:08 - 00:22:19:10

Speaker 2

And sort of points to a clear undersupply, especially in most popular destinations, and being able to accommodate people when they want to come. And you can point to our still almost record high occupancy levels and we were only down 1.2% off of our 2021 high in the US. So and overall like hosts are doing pretty well when you sort of compare this to past years as I said, up 11% versus 2019.

00:22:19:24 - 00:22:42:00

Speaker 1

It's just it's like it's I know I say it way too often, but you really just have to have context to these numbers in order to make sense of them. So that was incredibly helpful. And and also maybe facts before feelings, right? It feels like things were up. Facts before feelings. Your T-shirts are in the mail, everybody. Your t-shirts in the mail.

00:22:42:00 - 00:23:01:14

Speaker 1

Well, I thought I thought this was one this tweet was very interesting and something that we could definitely I know you addressed a lot of people's comments in in that Twitter feed, but but some individual said, one individual said, “half of the listings are always new. Within the last two years, volume is up, but the pattern is the same.

00:23:01:14 - 00:23:21:13

Speaker 1

It is meaningless without relationship to demand.” So, Jamie, you just kind of you talked a little bit about this in context to supply and occupancy, but just where are we at from your perspective, having just wrapped the numbers for September on travel demand How’s travel demand these days.

00:23:22:11 - 00:23:57:20

Speaker 2

Overall travel demand is great. So I mentioned an earlier Airbnb reporting will probably report around 1.4 million nights booked in the quarter. Yep, that's up over 30% year over year and up 22% compared to 2019. So listings are up 20%, demand's up over 20%. We're seeing more bookings per listing than we had seen in prior years.

00:23:57:20 - 00:24:20:22

Speaker 2

So and overall, that points to the higher occupancies that we're seeing globally. So sort of great, I think. And yes, his point is valid and I think I'm not saying that it's not it's a clear reading of what that chart says. And I think what we talked about that, yes, there's a lot of churn. There's always a lot of churn.

00:24:20:22 - 00:24:23:17

Speaker 2

But yeah, definitely a valid point there.

00:24:24:06 - 00:24:32:03

Speaker 1

I love it. Yeah. Well and it's I think it's just great to sort of because I know we talk a lot about travel demand being up. So just to contextualize that with a few numbers. Yeah.

00:24:32:18 - 00:25:08:08

Speaker 2

And, and we just saw from STR today that's the hotel company not the industry that hotel demand exceeded 2019 levels for the first month ever here in the US still up a percent and a half over 2019 levels. I think that sort of in combination with our data and sort of points to real strength of still the traveler out there, TSA checkpoints.

00:25:09:00 - 00:25:42:24

Speaker 2

So the TSA throughput reached a new post-pandemic high or post start of the pandemic high. Highest level since February 2020. So more people getting on airplanes, even more people this fall than getting on the plane during the summer. So great to see so many people now getting back to travel. Yeah. And then on the economic side, I still know slowdown and job growth are no significant sort of pull back in job growth.

00:25:42:24 - 00:26:26:17

Speaker 2

263,000 new jobs added. Yes, that's down from prior months, but it's still maybe a bit too high for for the Fed and I think we've talked about this in the past, but it's like a we're in this moment where we kind of want bad news and good news is actually bad news and bad news is good news. So if we would have only gotten 100,000 jobs or 50,000 jobs or flat jobs are like, yeah, the stock market would have gone up like jobs, growth is going down, like we're slowing the economy with, which is what the Fed's trying to do right.

00:26:26:17 - 00:26:58:03

Speaker 2

And we've got an absolutely horrible inflation report, I think, that came out last week. So headline inflation of 8.2%. Core inflation up 6.6%. Actually number ticking up from prior months. So I think it was like three or four months ago was like pay attention to this number. Yeah, if we start to see it come down, that's our sort of indication that we might be able to avoid a recession.

00:26:58:12 - 00:27:18:01

Speaker 2

If it keeps ticking up. That means the Fed's going to keep pressing on the gas and raising interest rates and creating further destruction in the economy. So and all things right now are pointing to the Fed continuing to raise interest rates and and the chance of recession keeps getting higher and higher.

00:27:18:16 - 00:27:45:14

Speaker 1

I know we might have to start doing like a barometer read for people, but yeah, we don’t want to depress anyone too much. Although, you know, I think it's just it's helpful to be prepared. And you said try to find sort of the way the way through it. And we've talked a lot in our first podcast about sort of understanding what type of recession we might might be encountering in the future and how that may be quite different from recessions we've had in the past.

00:27:45:14 - 00:28:12:23

Speaker 1

I think a lot of us have sort of the 08’ one in our heads and that one may look very differently than future ones. Potentially. Potentially. Well, Jamie, I want to like just really quick and then we can absolutely wrap up unpack. So you said you actually occupancy was only 1.2%, I think lower year over year for September. Is that true?

00:28:12:23 - 00:28:19:00

Speaker 1

And that was crazy because like August had a completely different story. Right? I think it was 4.4% lower occupancy. Yeah.

00:28:19:03 - 00:28:51:02

Speaker 2

No, that that is true. And it's in and still down, obviously, but not nearly as down as much as we'd seen during the summer. I think something that a trend that we called out last year that's still playing out today is the extended seasonality that a lot of the destinations are seeing. They're not seeing maybe the highs of July and August, but it's definitely extending out.

00:28:51:19 - 00:29:29:03

Speaker 2

Demand's extending out in a lot of these destinations are much further out than in previous years. And and I think it's it's being driven by two things. The most obvious one is the increased flexibility we still all have. And both of us are working from home right now, still trying to get to the office occasionally, but with the flexibility, we're not sort of and sort of restricted to the times when just the summer to get out and vacation.

00:29:29:03 - 00:29:59:17

Speaker 2

So we're still seeing the benefit of that. And I suspect that probably is going to be a more permanent shift in seasonality. And given that work from home isn't going away. And then the other is just how high occupancy continues to be during the summer, right? People having to push out their vacations to the shoulder season because they can't get get to the destinations they want to travel to in the way they want to.

00:29:59:21 - 00:30:25:23

Speaker 2

They're entirely sold out. So, I mean, it's sort of a function of how strong these markets are and how far in advance they're getting booked up, which that may be a great reminder. I'm not sure if we have a lot of guests listening or it's just hosts. But if you haven't started to plan your Thanksgiving and winter trips, things are booking up quickly.

00:30:25:23 - 00:30:33:25

Speaker 2

And we're we're seeing really strong demand as we look out into Thanksgiving Christmas travel.

00:30:34:06 - 00:31:04:11

Speaker 1

Thank you for calling this out, because, you know, I did this all wrong. I was thinking about spring break before our ski trips. Okay. All right. All right, guys. Homework for me. I wanted to end on one other really bright spot that I loved in the September review. So you actually called out that September marked the first month since April where ADR average daily rate growth exceeded the rate of the Consumer Price Index, otherwise known as the CPI.

00:31:04:11 - 00:31:15:05

Speaker 1

So anything to unpack there. I just thought that was kind of a lovely note. It sounds like that may be getting harder for us, right? Like short term looking pretty good for us long term, maybe a slightly different story.

00:31:15:27 - 00:31:53:14

Speaker 2

Yeah. And we had seen rate growth get pretty weak this summer and I think that was and in part and you're going to see the economists come out with me, come out, come out like the relationship between occupancy declines and sort of and pulling back on rates if as a host if you're not getting occupancy that you expect or you've seen in prior years, you're going to pull back on rate or you should be pulling back on rate to sort of drive occupancy to your property.

00:31:53:14 - 00:32:21:10

Speaker 2

So during the summer when occupancy was dropping a bit more, rate growth was much weaker with sort of a not as big of declines in occupancy as we head into fall. We're now seeing occupancy growth a bit stronger than we'd seen during the summer, helping offset maybe some of those increased expenses given the inflationary environment that we're in.

00:32:22:17 - 00:32:29:15

Speaker 2

Yeah. So and I'd love to see ADR sort of stay above that 5%.

00:32:29:15 - 00:32:29:24

Speaker 1

Right.

00:32:30:01 - 00:33:03:09

Speaker 2

Is sort of helping hosts sort of cover all the additional costs that go along with with hosting with the labor associated with it. We are seeing an uptick a bit more than ADR’s on cleaning fees. So cleaning fee increases running 8%-9%. So a bit higher than ADR growth. But that's and as we've talked about in the past, a whole lot more associated with the labor and really the lack of available labor for cleaning properties.

00:33:04:00 - 00:33:34:24

Speaker 1

Yeah. Well, thank you so much, Jamie. I have as always enjoyed talking to you. I've also really enjoyed seeing Airbnb get in the news a little bit more. Obviously, what's at the forefront of both of our minds is VRMA, V-R-M-A we’re super stoked to get down there and talk to people, since we're in the we're doing a love fest for other podcast, I think today just shout out to Sara and T they did a really great podcast on sessions that they thought were the best to catch.

00:33:35:03 - 00:33:48:08

Speaker 1

So for anyone that is going down there or just wants to know what's going on, highly recommend it. But otherwise I got to I got to go book some winter travel, Jamie I don't know about you, but I got to get busy over here.

00:33:48:08 - 00:33:55:19

Speaker 2

I actually just put my trip out to focus right in Phoenix. Looking forward to that one in November. So that should be a good one.

00:33:56:07 - 00:34:02:25

Speaker 1

Yeah, that'll be like from Denver, which you aren’t. But if you were, you'd be like, oh, Phoenix in November. Yes.

00:34:03:04 - 00:34:11:00

Speaker 2

I only say that to brag a bit that I booked all my Christmas and Thanksgiving travel about two months ago.

00:34:11:02 - 00:34:27:04

Speaker 1

Yeah, that's. Well, that's because you're smarter than me. Generally speaking. But yeah, this is again, just next time let me know. Be like Mariah. You're looking too far into the future. Alrighty, Sir. So let's call that a wrap. What do you think?

00:34:27:22 - 00:34:29:17

Speaker 2

Yeah, great podcast. I love it.

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