Significant changes in booking patterns are emerging across Europe’s short-term rental market, with travellers increasingly leaving their decisions until the final week before arrival.
According to KeyData, a company specialising in data analytics and benchmarking for the sector, the share of European bookings made in the final week before a stay increased from 18% in 2023 to 26% in 2026. Meanwhile, advance planning became less common, with bookings made two to six months before arrival falling from 30% to 24%.
Stays are also becoming shorter. Bookings for one or two nights accounted for 25% of the European total, up from 18% in 2023. This shift presents new challenges for professional property managers, who need to adapt their strategies to an environment where availability calendars fill later and with shorter stays.
Last-minute bookings do not generate the most revenue
One of the analysis’s key findings is that an increase in last-minute bookings does not translate into a corresponding increase in revenue.
In Europe, 26% of bookings are made in the final week before arrival, yet they generate just 13% of total revenue. Similarly, in the US, the 25% of bookings made within the same window account for only 11% of revenue.
The difference is largely explained by rates. In the US market, guests booking in the final week pay an average of $191 per night, while those booking at least six months in advance pay an average of $536.
In other words, bookings made several months before arrival remain the most important source of revenue. Specifically, the two-to-six-month booking window accounts for 35% of total revenue in the US and 32% in Europe.
These figures suggest that deep last-minute discounts are not necessarily the most effective way to increase revenue. Attracting guests who plan their holidays early may prove more profitable, even when an advance booking discount is offered.
Smaller properties are booked later, larger properties earlier
The variation by property size is particularly noteworthy. The lower average rate recorded for last-minute bookings does not necessarily mean that owners are cutting prices to attract guests. According to KeyData, the main reason is that properties still available in the final week are predominantly small apartments, studios and one-bedroom homes, which have lower nightly rates to begin with.
In the US, more than a third of bookings for studios and one-bedroom properties are made in the final week before arrival, at 36% and 37%, respectively. By contrast, only 15% of bookings for homes with four or more bedrooms are made in the final week, while around a third are secured more than three months in advance.
In Europe, the pattern is even more pronounced. Some 72% of studio bookings are made less than a month before the stay, while around half of bookings for properties with four or more bedrooms are made at least three months in advance.
Comparing rates without accounting for property size and category can therefore lead to misleading conclusions about market performance. In the US, nightly rates increased by 2.9% to 3.5% across almost all property categories, with the exception of studios, where they fell by 1.5%.
Airbnb and Booking.com gain ground over direct bookings
Another important development concerns the channels through which bookings are made. Major online platforms such as Airbnb and Booking.com are strengthening their position not only in last-minute bookings, but also in bookings made several months before arrival that generate the most revenue.
In the US, 75% of stays are now booked through online platforms, compared with 70% in 2024. Airbnb’s share increased from 42% to 48%, while bookings through property managers’ own websites fell from 29% to 24%. Vrbo also recorded a decline, with its share falling from 22% to 20%.
In Europe, direct bookings retain a stronger presence among travellers who plan their holidays well in advance. For example, 69% of bookings made at least six months before arrival are made directly with property managers.
However, the overall trend for direct bookings is also downward in the European market. Platforms now account for the majority of last-minute bookings, with Booking.com representing 48% and Airbnb 34%.
This development has particular financial significance, as property managers are losing share precisely within the two-to-six-month booking window, which contributes around a third of annual revenue.
Expectations for 2027 and the role of artificial intelligence
Despite the challenges, the outlook for revenue growth in 2027 remains positive. According to a KeyData survey of 396 US property management companies overseeing more than 113,000 properties, 77% expect their revenue to increase next year.
However, only 55% expect to be able to raise nightly rates. This means that anticipated growth will need to come mainly from an increase in nights booked and better use of available inventory.
At the same time, businesses are turning increasingly to major platforms. Some 25% of property managers plan to increase their reliance on them in 2027, while only 18% intend to reduce their use.
On the technology front, artificial intelligence has already become part of day-to-day business operations, with 89% of property managers reporting that they use it for at least one task.
However, its role remains primarily supportive. In an exercise held during the Vacation Rental Management Association (VRMA) conference, around 100 professionals assessed the extent to which AI was integrated into their businesses. Most placed their companies at an intermediate level, where AI helps carry out tasks, but human input is still required to initiate and complete them. No business reported having reached a fully automated level of operation.
The challenge for the year ahead
The emerging picture in Europe’s short-term rental market suggests that the sector’s operating model is changing. Travellers are booking later and increasingly choosing shorter stays, while major platforms are strengthening their position relative to direct bookings.
For property managers, the challenge in 2027 will not simply be to raise rates, but primarily to increase nights booked and manage availability more effectively.
The pricing strategy will now need to take account of property size, location, competition and typical booking windows. A small studio still available four days before arrival is not necessarily a sign of poor performance, unlike a large home that remains unbooked just days before the intended stay.
In an increasingly competitive market, making better use of every available night may prove more important than an across-the-board increase in rates.
