COVID-19 Report

Airbnb takes flight: The short-term rental company’s surprising (relative) success during the COVID-19 pandemic

Thursday, October 1, 2020 • 3:00 PM EST

Key Takeaways:

1. Airbnb is outperforming the rest of the lodging industry in the face of the pandemic, which may bode well for the company’s imminent IPO. Current Airbnb spending is comparable to the summer of 2019, whereas the lodging industry is down approximately 50% compared to prior year.
2. Airbnb has seen an increase in average booking sizes during the pandemic, coupled with a decline in frequency. Suggesting that consumers are booking either more expensive homes, staying longer or requiring additional amenities, such as high speed internet or more fulsome kitchens to cook from home.
3. Given these numbers, it is not surprising that Airbnb’s share of the lodging industry has grown significantly since the beginning of the year from 29% to over 57%.
4. Perhaps this interest in Airbnb rentals is due to a plurality of travelers’ belief that they are less likely to contract the coronavirus from a rental property than a hotel.

The ongoing COVID-19 pandemic has kept many Americans in homes for the last several months, but not necessarily in their own homes. Airbnb, the now 12-year-old short-term vacation rental platform, has long been a competitor to more traditional vacation lodging options like motels, hotels, and resorts, but in the time of the coronavirus, has gained new ground on the rest of the industry. 

In order to better understand the effects of the COVID-19 pandemic on both Airbnb and the lodging industry, we examined customer spend at rental properties and hotels. We also surveyed Airbnb customers to learn how their travel habits and mentalities had changed as a result of the pandemic.

One is not like the others

Whereas the lodging industry as a whole has experienced a steep drop-off in business as a result of the decline in travel prompted by the global pandemic, Airbnb has managed to weather the storm better than other players in the space.

At the height of the pandemic in April, the lodging industry was down by between 80% and 90% when compared to the beginning of the year. Airbnb, however, was never hit quite as hard; at worst, the company experienced a drop-off of between 70% and 80% when compared to January. 

Today, Airbnb’s weekly GMV has recovered, with spending comparable to levels seen during the summer months of 2019. In contrast, the lodging sector is approximately 50% below the summer months of 2019.

Gaining on the competition

Given Airbnb’s ability to outperform traditional lodging options during the height of the pandemic and recover to 2019 levels, it’s not surprising that the company’s share of the market has grown since the beginning of the year. In January, Airbnb sales comprised 29% of the industry; today, that number has nearly doubled to over 57% market share. Given the company’s upcoming IPO, this seems to be an encouraging sign for investors.

The growth in Airbnb’s market share is mainly due to its ability to maintain its existing customer base, while the remainder of the lodging industry has shrunk. Taking a look at newly acquired users, one might think that Airbnb has been able to gain share by converting historical hotel goers at a faster rate than previously. However volume of newly acquired users has declined significantly since the beginning of 2019, with its current volume of new additions 50% of what it was back in 2019 and consistent with Fall 2019 volumes.

Hey Big Spenders

Whereas transaction frequency (the number of bookings made on Airbnb) have experienced a decline since the beginning of the year, average booking value has increased by 40%. Suggesting that consumers are booking Airbnbs less frequently but staying for longer or booking more expensive rentals, perhaps requiring additional amenities like high-speed internet or more fulsome kitchens as they eat out less.

Since the height of the pandemic, there is a slight shift towards folks in higher income brackets who have booked Airbnb rentals. Whereas before the pandemic, 49% of Airbnb bookings came from those making more than $50,000 per year, today, 53% of bookings come from these earners. It is also worth noting here that half of survey respondents told us their budget for vacation remained constant throughout the pandemic.

More last minute bookings

This is a distinct departure from pre-COVID booking habits, where 64% of travelers booked their homes two to six months in advance, and only 26% booked their travel less than four weeks in advance. Our survey found that nearly 38% of customers labelled their booking during the pandemic as a “last minute vacation”, with a majority (59%) booking their rentals less than four weeks in advance.

Pleasure, not work

Majority (75%) of respondents told us that their most recent Airbnb booking involved absolutely no work, and was purely vacation. Only 11% of respondents said that they used their booking to self-quarantine, unsurprising given that 45% of respondents said that they traveled with friends to their most recent booking.

Cleanliness is key

Perhaps Airbnb’s relative success during the COVID-19 pandemic is due in part to the fact that customers believe rental homes to be less dangerous or no more dangerous than hotel rooms in terms of the virus. 43% of our survey respondents said that they believed they were less likely to contract COVID-19 from an Airbnb rental property than a hotel, and 45% said that the risk was the same.


The travel and lodging industries at large will continue to face an uphill battle as uncertainty surrounding the COVID-19 pandemic wears on. But it seems that Airbnb should be able to continue to weather the storm better than most due to its ability to provide greater flexibility than traditional lodging options.