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Why you need to watch out for one-night stays in 2021

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Longer stays have become an increasingly popular trend in hospitality during the COVID-19 pandemic. The start of 2021 has seen bookings in the U.S. average 6.6 days and bookings in the UK average 9.1 days, according to Guesty. With so many hurdles to jump through for the sake of a vacation, one- to two-night getaways aren’t enough anymore. Plus, some regional safety measures force people to settle in longer-term to prevent the virus from spreading.

Keeping this in mind, you’d expect to see a drastic decrease in one-night stays. COVID-19, after all, has restricted travel, limited attendees at sporting events and cancelled concerts, leaving less and less reasons for someone to book a rental for one night. Yet, according to data from Autohost, one-night stays have only decreased by 7%. They still account for more than 10% of reservations.

So what gives?

One-night stays: risk vs. reward

In the short-term rental business, nothing strikes up the risk vs. reward debate like one-night stays. On one hand, they can be incredibly lucrative, offering high ADRs for low commitment. Before the pandemic, one-night listings earned an average 17% more revenue throughout the year (excluding August) than listings with two-or more night minimums, according to AirDNA.

But on the other hand, without proper review, one-night stays can pose a serious risk to property management companies. There is a much higher chance that a one-night stay (especially over a weekend) will result in a party, crime, or, currently, guests dismissing COVID-19 protocols. To manage the uncertainty, some operators avoid these “risky” reservations altogether, opting to attach minimum stay requirements to their listings.

Instead, these operators focus on longer bookings—a potentially less lucrative source of revenue, but certainly a safer and more reliable option.

One-night stays may come with greater risks

Depending on your region, accepting a one-night stay during the pandemic can be significantly riskier than it was pre-pandemic.

In the U.S., travel varies dramatically based on location. While some cities are experiencing lockdowns, others have no travel restrictions in place at all. Knowing what's going on in your region will help you to better assess the current risks to your business.

In heavily restricted areas, the typical bookings for one-night stays are off the table. These are your business travellers, your couples out for a fun night in the city—your target groups. The ones who are abiding by travel restrictions, following health measures and not gathering in large groups.

With legitimate bookings out of the question, the pool of one-night reservations becomes a serious threat to your business. If you accept them without proper screening, you run the risk of having your property contaminated, your team’s health endangered and being fined for breaking bylaws around parties and social gatherings.

If you operate in an area without COVID restrictions, you might feel unaffected. However, travel advisories still come into play, limiting both international and out-of-town travel. With domestic travel taking over, you need to be on high alert for guests booking to throw a party. Given the current climate, the repercussions of a large event could be detrimental to your reputation.

So what can you do?

The only solution is to Know Your Guest. With the COVID-19 vaccines rolling out, travel will rebound and we'll see shorter stays in greater numbers. But in the meantime, take this opportunity to establish a proper process for guest screening.

One-night stays are too lucrative to avoid altogether, especially as big events and holiday travel restart. To capitalize on the good reservations, here are Autohost’s top guest screening tips:

Tips for guest screening

  1. Collect personal information from the guest, including reason for travelling.

  2. Verify the guest’s ID to confirm they are who they say they are.

  3. Look out for any suspicious behaviour that could point to a fraudulent transaction. 

  4. Have the guest sign a rental agreement, acknowledging your house rules and terms of service.

  5. Check out Autohost’s Ultimate Guide to Guest Screening.

Unfortunately, manual guest screening leaves room for error and discrimination. That's why Autohost automates the process. By being methodical, you can derisk the safe guests and flag those with bad intentions. Rather than barricading your property listings with booking restrictions, allow riskier reservation types like one-night stays to increase listing visibility and maximize bookings.

With a proactive approach to security, you don’t have to leave revenue on the table by avoiding risky reservations. A thorough guest-screening process ensures you book more guests while keeping your properties safe.