Eight in ten travelers who have stayed at a B&B, inn, or small hotel would consider choosing a short-term rental if its price were the same or slightly lower. This finding highlights the growing competition that small, independent hospitality businesses face from Airbnb-style accommodations.
According to a survey by PriceLabs, a company that develops revenue management software for the hospitality industry, 82% of respondents who had previously chosen a small hotel, inn, or B&B would be willing to consider an alternative stay in a short-term rental (STR), provided the price was comparable or slightly lower.
In fact, nearly half of respondents, 48%, said they would switch accommodations even if the alternative property were priced exactly the same. By contrast, 18% said they would not consider moving away from their original choice of traditional accommodation.
The survey, titled “Who Do Independent Hotels Really Compete With?”, was conducted among 1,082 travelers from the United States, the United Kingdom, France, Spain, and Portugal. Its findings indicate that small, independent hotels face stronger competition from short-term rentals than major hotel chains do.
Notably, 30% of guests who booked a B&B, inn, or small hotel also considered a short-term rental for the same trip. Among guests staying at large hotels, the corresponding figure was just 16%.
Stronger competition for longer stays
The comparison between hotels and short-term rentals appears to become more pronounced for longer trips or travel that combines different purposes.
Specifically, travelers considered both types of accommodation for 30% of trips combining business and leisure, while the corresponding figure reached 25% for stays lasting one to two weeks.
These findings suggest that travelers do not necessarily limit their search to a single accommodation category. Instead, they compare alternative options based on price and the characteristics of their stay, intensifying competition between different types of hospitality businesses.
The role of booking platforms
Digital platforms also appear to play a significant role in accommodation choices. When travelers search for accommodation through Booking.com, where hotels and short-term rentals are displayed alongside one another, 45% compare both categories.
This figure drops to 29% among travelers who make direct bookings with the property.
This difference highlights the role of bringing different accommodation options together on a single platform, making it easier to compare prices directly and evaluate property features. It also shows that listing a property in an environment where multiple types of accommodation coexist can expose it to a broader range of competitors.
Prices follow similar trends
PriceLabs also examined the relationship between the median daily rates of hotels and short-term rentals in Mallorca and Barcelona over a 12-month period.
In Mallorca, the correlation between prices reached 94%, while in Barcelona it stood at 84%. These figures indicate that prices across the two accommodation categories followed largely similar patterns during the period examined.
This finding reinforces the picture of a market in which hotels and short-term rentals no longer operate as two entirely separate competitive segments but are influenced by common factors shaping demand and pricing strategies.
According to PriceLabs co-founder Anurag Verma, hotels and short-term rentals were treated for years as separate markets serving different groups of customers. However, the survey findings suggest that many travelers no longer make this distinction.
It should be noted, however, that the survey was commissioned by PriceLabs itself and covers five countries. Therefore, its conclusions cannot be considered representative of travelers worldwide, nor can they automatically be applied to every tourism market.
Despite this limitation, the findings highlight a significant trend in the hospitality industry: the choice between hotels and short-term rentals is increasingly becoming a matter of direct comparison, with price, trip duration, and the way travelers search for accommodation influencing their decisions.
