Representative ImageThe US vacation rental market is entering 2026 with cautious optimism, as operators hold firm on pricing despite weak early demand. According to Key Data's Q1 2026 Index, early indicators show a 6% drop in paid occupancy for January and a 5% decline in February compared to last year. However, operators are not discounting rates, anticipating a late surge in bookings.
Forward-looking data reveals that occupancy rates improve as arrival dates approach, narrowing the gap to 3% below last year by March. This trend reflects a shift in booking behaviour, with travellers opting for shorter booking windows and stays. Melanie Brown, VP of Data Analytics and Insights at Key Data, noted, "Operators are pricing for late pickup and protecting rate integrity."
Despite the early softness, average daily rates (ADR) are up 2% in January, increasing to 4% in February and March. Revenue per available room (RevPAR) is tracking 4% lower in January but stabilises to flat in February and turns slightly positive by March. This suggests that operators are prioritising margin protection over early volume growth.
Regional performance varies, with the Mid-Atlantic and New England regions seeing an 18% increase in RevPAR due to occupancy gains and disciplined pricing. In contrast, the Western US experienced an 8% rise in RevPAR, driven by strategic pricing despite flat occupancy.
As booking windows compress, platforms like Airbnb are benefiting, capturing 54% of reservations and 45% of total revenue in Q4 2025. Direct bookings, whilst accounting for 28% of revenue, face challenges in capturing last-minute demand without strong visibility and conversion capabilities.
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