Summary

The global vacation rental market faced a major challenge due to the COVID-19 crisis, which heavily affected the tourism sector in 2020 with an estimated loss of €30-40 billion in revenues for France alone and a loss of $320 billion internationally according to the World Tourism Organization. Despite this setback, the market, which had been dominated by Europe and the United States, was previously on a growth trajectory, with the sector expected to grow at a CAGR of 3.4% between 2020 and 2027 to reach nearly $114 billion, propelled by demand from millennials, who are expected to make up 75% of international travelers by 2025.

France, Europe's second-largest market for vacation rentals, is seeing its market driven by individuals, with online platforms such as Airbnb and Booking.com leading the way in bookings. The regulatory environment is crucial, as evidenced by France's Elan law, which limits the number of rental nights per year to 120 in order to control accommodation prices in tourist towns. Despite the crisis, French domestic tourism has shown resilience with domestic consumption preferences, as French tourists turned to local destinations during the pandemic period in 2020.

The dynamics of the French vacation rental market in the face of changing demand

In recent years, the French vacation rental market has experienced significant growth, driven mainly by local customers and complemented by international visitors. The market, with a global value of over $87 billion, has enabled France to consolidate its position as Europe's second-largest vacation rental market. This growth trajectory suggests an influential shift in tourist accommodation preferences, particularly among millennial travellers who are expected to make up three quarters of international tourists by 2025.

France, in particular, has been at the forefront of this evolution, with between 80 and 90 million tourists visiting the country, the highest number in the world. Domestic tourism consumption also showed robust growth, with spending fluctuating between $170 and $175 billion in the same year. Demand within the market is remarkable, with French customers accounting for almost two-thirds (around 66%) of the clientele on private rental platforms. It's interesting to note the steady rise in overnight stays by local and foreign tourists in market accommodations - a figure that has held steady at between 350 and 400 million overnight stays in recent years.

French tourists prefer to rent apartments or houses for their vacations, with almost 45% expressing this preference. This penchant for vacation rentals is in line with the propensity of French people to spend their vacations within the country, with over 50% choosing to stay in the country.

In addition, the average vacation budget has risen by 10% to over $2,200. The decision-making process when choosing a vacation rental revolves around three main factors: location, price and cleanliness. Location remains the top criterion, influencing around 70% of renters, followed by cost at around 50%, and cleanliness at almost 50%.

Key market players

The vacation rental market has evolved with the proliferation of digital platforms that are redefining the way travelers search for accommodation. This reshaping of the market is mainly orchestrated by a small number of key players with an influential presence, both nationally in France and globally.

  • Airbnb is the paragon of the peer-to-peer accommodation sharing model, having modestly disrupted the traditional rental market, starting out by offering personal living spaces to travelers seeking unique and convivial experiences. It has evolved into a community platform where owners can offer their properties and connect with potential hosts from all over the world. The platform's staggering growth is evidenced by its impressive market presence, and it has become synonymous with vacation rentals for a wide range of customers.
  • Booking.com has carved out a niche as a travel-rate aggregator, where customers can not only rent vacation homes, but also book flights, airport cabs and restaurants. Booking.com is not limited to private residential properties, but offers a wide range of accommodation types, catering for different preferences and price points. Booking.com's wide range of choices has positioned it as an industry leader, enabling users to plan their entire vacation from a single portal.
  • LeBonCoin is similar to a digital marketplace, operating as a generalist classifieds site that has extended its reach into the vacation rental space. Although it offers a range of goods and services, its section dedicated to vacation rentals has attracted considerable interest in France, as it enables owners to advertise their accommodation directly to potential tenants, without the intermediation costs often associated with specialized platforms.
  • SeLoger.com is a recognized name in the real estate and rental industry. As a specialist classifieds portal, it offers a multitude of options to those specifically looking to find properties to rent, including vacation homes, throughout France. It is a niche platform for property seekers, making it a targeted choice for rental transactions.
  • Gîtes de France and Clévacances are networks that are the guardians of authentic French vacations, offering a range of bed & breakfasts and holiday homes. They preserve the very essence of traditional French hospitality and offer tourists the assurance of certified quality accommodation.
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  • Number of pages : 30 pages
  • Format : Digital and PDF versions
  • Last update : 18/06/2023
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Summary and extracts

1 Market overview

1.1 Presentation and definition of the market

French legislation defines seasonal rental as " a lease of a building entered into for a maximum non-renewable term of ninety consecutive days; and "

The market brings together the different platforms allowing to rent a dwelling for a short period of time, most often between private individuals and concerns different types of housing : houses, villas, apartments, rooms or even bungalows and caravans.

The global market is growing and catching up with the revenue levels generated by the hotel industry

France is the second largest European market for seasonal rentals and this type of accommodation is attracting more and more French people. Very touristic country, the French market is particularly dynamic, also drawn by a local clientele

The stiff competition between professional players in the hotel industry and private individuals using a platform to rent out their property. The legislative frame and also crucial for the future growth of the sector.

 

1.2 A fast-growing global market dominated by Europe and the United States

In the world the seasonal rental market will overtake the hotel market by **** in the words of VRMB . The global vacation rental market was estimated at over $** billion in ****, and is expected to grow at a CAGR of *.*% over the period ****-*** to reach nearly $*** billion in **** . The millenials represent the ...

1.3 The dynamic French market

France is following the global trend with growth in the holiday rental market driven by individuals. Seasonal rentals in France are mostly composed of rentals between individuals both professional players renting accommodation (***) have recently lost weight compared to specialised players targeting private individuals. The seasonal rental market is characterized by a ...

1.4 The impact of the Covid-19 crisis

However, the crisis linked to Covid-** will hit the tourism sector hard in ****, particularly in connection with the sharp drop in foreign tourist arrivals over the year. In August ****, estimates announced that the impact on the tourism sector should amount to ** or ** billion euros in lost revenue. In the first half ...

2 Demand Analysis

2.1 A significant and growing demand for tourism

The France was the most visited country in the world in **** with ** million tourists ahead of Spain and the United States according to the Enterprise Directorate-General According to the same source total domestic tourism consumption in France has been growing since **** to settle in ***.* billion in **** [***]

  Annual arrivals of foreign ...

2.2 Demand driven by French customers

According to Les Echos the french customers of holiday rentals between individuals grew by **% in **** against **% for foreign customers . French customers also account for **% of the total clientele of the private rental platforms .

In general, the foreign customers still increased the number of nights spent in France in commercial accommodation which ...

2.3 Le retour des voyageurs internationaux

La crise sanitaire a fortement affecté les dépenses des voyageurs internationaux en France. Cependant, avec le retour des touristes non résidents en France depuis mai ****, les dépenses sont reparties à la hausse.

Évolution des dépenses des touristes internationaux France, ****-****, en milliards d'euros *Pour ****, nous avons fait ...

2.3 Reservation and selection criteria for a vacation rental

Growing average spending

According to the real estate barometer "holiday rentals", the average expenditure per holidaymaker in **** was €*** for a week's rental during the summer months . This amount was up by **% compared to the previous year (***), but it was still below of the average budget from ***€ that the vacationers were fixing ...

2.4 The structure of tourist spending favours accommodation

In ****, the structure of tourist expenditure showed a central place given to expenditure on accommodation: for French visitors, expenditure on accommodation represented **.* billion euros, and this amount could reach **.* billion euros for foreign visitors.

Structure of tourist expenditure, French visitors France, ****, in billions of euros Source: ****

  Structure of tourist expenditure, ...

2.5 Les Jeux Olympiques Paris 2024 : vers une forte hausse de la demande en location saisonnière à Paris ?

Les Jeux Olympiques et Paralympiques seront organisés à Paris en **** et pourraient générer **,* milliards d'euros de retombées économiques. [***] La venue de nombreux touristes étrangers fortunés pourrait également avoir un impact très positif sur les locations premium et de luxe sur cette période à Paris, avec une ...

3 Market structure

3.1 A very large supply, unevenly distributed over the territory

The offer of tourist accommodation, and in particular seasonal rentals, is very important on French territory. Thus, in ****, tourist residences accounted for **.*% of the total number of beds available for tourist accommodation in France, and furnished tourist accommodation accounted for *.*% of the available beds.

The accommodation offer by type of establishment France, ...

3.2 A market characterized by the growth of e-commerce

E-commerce is showing very high growth rates in the holiday rental sector. Overall, according to iNSEE , the use of commercial tourist accommodation offered by private individuals on online platforms specialized companies in France has strongly increased between **** and **** (***) . A Paris, the increase was * % in the fourth quarter of **** compared to the ...

3.3 Booking and AirBnB, the two main booking platforms in France

Seasonal rental players are relying massively on the web and social networks. The new players have succeeded in penetrating the market by offering a innovative delivery system of particular to particular, convivial, a source of encounters, and at more advantageous prices, with new and varied types of accommodation. The growth of ...

4 Analysis of the offer

4.1 Rental prices have been on the rise in recent years

Homeowners increased their rates in **** over **** with a average price increase of *% according to Les Echos . The average rent for a one week rental had a increase of **€ to reach ***€ per week in ****

In **** and always from the same source, **% of the offers were between ***€ and ***€ per week whereas in **** , **% of ...

4.2 The importance of the internet in holiday booking

According to Real Estate Consortium , **% of searches for holiday rentals in France will be done on the internet in **** when only *% of the searches are done via a real estate agency . The new tools used are for example TripAdvisor, Booking but also AirBnB where future customers can know the opinions of ...

4.3 Renting a house or an apartment remains the preferred method of accommodation for the French

According to IPSOS , **% of respondents responded by **** than their preferred hosting method was the renting a house or apartment against **% Hotels . This confirms the boom in private-to-private rentals in France .

Poll: What type of accommodation do you prefer for summer holidays? In % of Ispos /Euro Assistance / Businesscoot Processing

However, few people ...

5 Regulation

5. Regulation

The main challenge for the holiday rental sector remains the regulation particularly sublease restriction . The weak point of the new specialized sites is that they do not offer a guarantee. Faced with this risk, some sites have entered into an agreement with Europe Assistance (***) in order to consolidate their offer. Europ ...

List of charts

  • Estimation du marché mondial de la location saisonnière
  • Répartition des nuitées passées en hébergement marchand par des touristes français
  • Evolution de l'offre et de la demande des appartements dans la location touristique de particuliers à particuliers
  • Annual arrivals of foreign tourists
  • Consommation touristique intérieure
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Latest news

Homanie launches the first corporate seminar observatory - 28/08/2023
  • Homanie employs 12 people
  • Corporate seminars account for nearly 60% of sales
  • . The main perceived benefits of corporate seminars are: strengthening team cohesion (85%), improving communication (54%) and generating new ideas (44%).
  • Homanie has some sixty houses in exceptional geographical locations.
The Collectionist, a luxury vacation rental company, makes acquisitions. - 02/03/2023
  • Specialist in high-end vacation rentals with concierge service
  • Average price of a week's rental around 30,000 euros 1,800 exceptional homes in 30 cities worldwide
  • 60 million euros raised in December from Highland Europe investment fund
  • Medium-term target of 500 million euros by 2026
  • Three acquisitions in 2022 in France, Greece and Ibiza, with a strategic partnership with Insider Villas. The Paris-based SME founded in 2014 will gain access to the 160-home portfolio of the Spanish Insiders Villa group, which operates in Mallorca, Ibiza and Menorca
  • The Collectionist currently employs 250 people
  • In 2022 alone, more than 500 new properties have been added to the company's catalog
  • Le Collectionist joins French Tech 120, a government support program for France's most successful companies
Fiber optics: Circet takes over Scopelec and half its workforce (around 1,000 jobs) - 22/01/2023
  • Scopelec company specialized in the installation and maintenance of fiber optic and copper networks
  • Circet group of 15,000 employees in 14 countries, with sales of 2.42 billion euros in 2021,
CEPSA, a Spanish company, wants to make a name for itself in the hydrogen field. - 09/12/2022
  • Gigantic green hydrogen production hub to run between Cadiz and Huelva
  • Cepsa will invest 3 billion euros to set up the solar fields and wind turbines that will generate the renewable energy needed to power the electrolysis process.
  • The circuit is expected to produce 300,000 tonnes of green hydrogen per year
  • Maersk plans to invest 10 billion euros in Spain to establish two bases for e-methanol production
The Collectionnist, the Airbnb of luxury, wants to cover the world - 02/12/2022
  • The company has just raised 60 million euros
  • Specializing in the seasonal rental of luxury serviced villas, 1800 addresses, mainly in Europe
  • the platform claims to be the leader in its category
  • By 2022, it will have reached the 100 million mark in business volume, representing revenues of 25 million euros
  • Since 2019, business has increased more than sixfold.
  • The Collectionnist employs 250 people (and as many seasonal workers), and will recruit 120 in 2023, to develop its offices in France, Spain, Switzerland, Athens and New York.
  • Has already acquired five competitors, including three this year
  • expected sales of 500 million euros by 2026, a third from acquisitions
  • Profitable since 2020
Liquid sourdough boosts Puratos' Vosges site - 22/11/2022
  • Belgian group (65 plants, 2 in France) present in 81 countries
  • 2021, sales of 2.3 billion euros for 9,000 employees.
  • Inauguration of a liquid sourdough production line at the Charmes Vosges plant (80 employees), specialized in the processing of dried fruit, pralines and the filling of baking powders
  • The 2 French plants total sales of 201 million euros.
  • the sourdough market could grow by 4.2% a year over the next 3 years.

Companies quoted in this study

This study contains a complete overview of the companies in the market, with the latest figures and news for each company. :

Airbnb
Booking.com
SeLoger.com
Gîtes de France
Cléavacances
Le Collectionnist
Abritel (Expedia Group)
Homanie

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