Short-term Rental Apartment Market Size and Share Analysis - Growth Trends and Forecasts (2025-2032)

Market Size and Trends

The Short-term Rental Apartment Market is estimated to be valued at USD 105 billion in 2025 and is expected to reach USD 190 billion by 2032, growing at a compound annual growth rate (CAGR) of 9.1% from 2024 to 2031. This robust growth underscores the increasing popularity and widespread adoption of flexible, short-term living solutions driven by evolving traveler preferences and the expanding digital platforms facilitating such rentals.

Key market trends indicate a surge in demand for personalized and tech-enabled rental experiences, with emphasis on seamless booking, contactless check-ins, and enhanced safety protocols. Additionally, the rise of remote work culture continues to fuel demand for longer stays, influencing property owners to optimize units for both leisure and business travelers. Integration of smart home technologies and sustainability practices also emerge as significant drivers shaping the market landscape.

Segmental Analysis:

By Property Type: Dominance of Furnished Apartments Driven by Convenience and Comfort

In terms of By Property Type, Furnished Apartments contributes the highest share of the market owing to their unparalleled blend of convenience, comfort, and immediate usability. Travelers increasingly prefer furnished apartments because they offer a fully equipped living space that negates the need for additional purchases or arrangements, allowing for a hassle-free stay. These apartments cater to a broad spectrum of users, from families on short vacations to remote workers needing longer-term accommodations. The appeal of having essential amenities such as kitchen facilities, laundry options, and comfortable living areas fully furnished enhances the guest experience, blending the comfort of home with the flexibility of short-term rentals.

Serviced apartments also play a significant role but are often positioned for those seeking hotel-like services combined with residential privacy. However, the flexibility and cost-effectiveness of furnished apartments make them more attractive for extended stays or families who prioritize a more homely environment. Vacation rentals, shared apartments, and other categories cater to niche demands but do not match the universal appeal and adaptability that furnished apartments currently provide. The modern traveler's inclination toward spaces that provide a high degree of autonomy, coupled with well-equipped living conditions, makes furnished apartments the preferred choice. Additionally, technological advancements in property furnishing and the rise of property management companies specializing in short-term rentals have further optimized the upkeep and turnaround of these units, reinforcing their market dominance.

By Booking Type: Online Platforms Reign Due to Accessibility and User Experience

In terms of By Booking Type, Online Platforms contribute the highest share of the short-term rental apartment market because they have revolutionized how consumers search, evaluate, and finalize their stays. The digital transformation in travel has positioned online booking platforms as the go-to intermediary, offering seamless, transparent, and efficient booking experiences. These platforms provide vast inventories, up-to-date availability, and competitive pricing, enabling users to make well-informed choices. Additionally, integrated reviews, photos, and customer feedback increase trust and reduce uncertainty, which has appealed strongly to the modern traveler who values ease and reliability.

Online platforms also offer dynamic features such as instant booking, secure payment gateways, and customer support, all of which enhance user confidence. Another significant factor driving growth in this segment is the widespread adoption of mobile apps, allowing travelers to book on the go. The rise of personalized recommendations powered by artificial intelligence and machine learning further refines the user experience, helping users discover accommodations tailored specifically to their preferences and budgets. While direct bookings and travel agents continue to maintain segments of the market, particularly in corporate travel or concierge services, the sheer scale and accessibility of online platforms have disrupted traditional booking patterns.

Moreover, online platforms serve as a critical marketing channel for property owners and managers, expanding their reach globally without the constraints and costs of conventional marketing. The ability to interface with a broad audience worldwide rapidly accelerates transaction volumes, making these platforms indispensable to the short-term rental ecosystem.

By End User: Leisure Travelers Lead Owing to Growing Demand for Experiential Travel

In terms of By End User, Leisure Travelers contribute the highest share of the market driven primarily by the increasing demand for experiential and customizable travel that short-term rental apartments uniquely fulfill. This segment includes families, tourists, and vacationers seeking more authentic, flexible, and often more affordable accommodations than traditional hotels can offer. Short-term rental apartments provide a localized living experience, often situated in residential neighborhoods rather than tourist-heavy areas, which appeals to travelers looking for a deeper cultural connection and a sense of "living like a local."

Leisure travelers benefit from the ability to choose apartments that suit various group sizes and travel styles, from solo trips to large family vacations. The availability of kitchen facilities, privacy, and more living space makes these apartments attractive for longer stays and repeat visits, adding to customer loyalty in this segment. Furthermore, the growth of international and domestic tourism, especially post-pandemic, has led to an increase in short getaways and vacation-focused travel, propelling demand from leisure travelers.

While business travelers and digital nomads also represent important end-user segments, each with specific requirements such as proximity to business districts or reliable internet connectivity, the leisure segment remains dominant due to broader volume. The leisure segment's increase in discretionary spending on travel and preference for personalized and independent travel arrangements further emphasize why this group drives substantial market demand. The evolving lifestyle trends, inclusive of remote working vacations and multi-generational family travel, amplify this segment's preference for short-term rental apartments that offer both flexibility and a home-like environment.

Regional Insights:

Dominating Region: North America

In North America, the dominance in the Short-term Rental Apartment Market stems from a mature and well-established market ecosystem characterized by a robust hospitality industry and a highly developed digital infrastructure. The presence of major online platforms such as Airbnb, Vrbo, and Sonder has revolutionized the way short-term rentals are marketed, booked, and managed, contributing significantly to market traction. Furthermore, favorable government policies in key countries like the United States and Canada — particularly in major urban and tourist hubs — have facilitated business growth while implementing regulatory frameworks that balance the interests of hosts, guests, and local communities. Trade dynamics, including high international tourist inflow and strong domestic travel demand, further boost this region. Notable companies such as Airbnb, Vacasa, and Sonder have significantly shaped market trends by offering innovative property management solutions and expanding portfolio diversity, strengthening North America's leadership position.

Fastest-Growing Region: Asia Pacific

Meanwhile, the Asia Pacific exhibits the fastest growth in the Short-term Rental Apartment Market due to a convergence of rising disposable incomes, rapid urbanization, and increasing travel and tourism activities in emerging economies such as India, China, Japan, and Southeast Asian countries. A nascent but rapidly evolving market ecosystem benefits from investments in digital platforms, with local players like OYO Rooms and Xiaozhu complementing global giants. Regional governments are progressively adapting regulatory frameworks to promote tourism and accommodation innovation, though some markets still face challenges related to policy enforcement and standardization. The swift expansion of the middle class, growing preference for experiential travel, and enhanced infrastructure — including transportation and connectivity — propel the adoption of short-term rental apartments. Key trade dynamics involve increased intra-regional travel and strong ties with Western tourists, encouraging both supply and demand growth. Companies like OYO, Agoda Homes, and Trip.com have played pivotal roles by scaling market access and integrating technology-driven solutions.

Short-term Rental Apartment Market Outlook for Key Countries

United States

The United States' market is dominated by extensive adoption of short-term rental platforms such as Airbnb, Vrbo, and Vacasa, supported by a broad network of urban and vacation rental destinations. Regulatory environments vary by city and state, influencing supply and operational strategies. The presence of well-established travel hubs and a strong culture of domestic tourism sustains high rental demand. Companies leverage advanced analytics and dynamic pricing tools to optimize occupancy and revenue management.

China

China's market continues to lead the Asia Pacific region, fueled by a burgeoning domestic tourism sector and increasing digital penetration. Local companies like Xiaozhu and Tujia compete alongside global rivals by focusing on technology integration and consumer trust-building. Government initiatives aimed at promoting the tourism sector and urban redevelopment have enhanced the infrastructure supporting short-term rentals. The evolving regulatory landscape is gradually becoming more structured to ensure quality and safety.

Germany

Germany's market showcases steady growth, underpinned by strong regulatory clarity and consumer protection policies. The presence of major metropolitan areas and popular tourist destinations supports sustained demand, with platforms such as Wimdu and 9flats, alongside Airbnb, actively operating. Industry players emphasize compliance and sustainable tourism practices, contributing to a responsible market expansion. Germany's efficient transportation network and robust economy further strengthen market resilience.

India

India's market is rapidly evolving, benefiting from demographic shifts and increased internet accessibility driving online booking adoption. Homegrown companies like OYO Rooms have disrupted the short-term rental landscape by offering standardized apartment accommodations across urban and tier-2 cities. Government support for digital initiatives and infrastructure development, linked to the booming tourism sector, enhances market prospects. Challenges remain around regulatory standardization and quality assurance.

United Kingdom

The United Kingdom's market thrives on a combination of historic tourism appeal and a burgeoning business travel segment. Companies such as Airbnb and Tribute Apartments have capitalized on London's global connectivity and cultural attraction. The government promotes tourism while enforcing robust short-term rental regulations to address housing affordability and community impact. The mature ecosystem fosters innovation in property management and guest experience enhancement.

Market Report Scope

Market Segmentation

Property Type Insights (Revenue, USD, 2020 - 2032)

• Furnished Apartments
• Serviced Apartments
• Vacation Rentals
• Shared Apartments
• Others

Booking Type Insights (Revenue, USD, 2020 - 2032)

• Online Platforms
• Direct Bookings
• Travel Agents
• Others

End User Insights (Revenue, USD, 2020 - 2032)

• Leisure Travelers
• Business Travelers
• Digital Nomads
• Others

Regional Insights (Revenue, USD, 2020 - 2032)

• North America
• U.S.
• Canada
• Latin America
• Brazil
• Argentina
• Mexico
• Rest of Latin America
• Europe
• Germany
• U.K.
• Spain
• France
• Italy
• Russia
• Rest of Europe
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• ASEAN
• Rest of Asia Pacific
• Middle East
• GCC Countries
• Israel
• Rest of Middle East
• Africa
• South Africa
• North Africa
• Central Africa

Key Players Insights

• Airbnb
• Vacasa
• Sonder
• Expedia Group
• Booking Holdings
• OYO Rooms
• Agoda
• TripAdvisor
• RedAwning
• The Ascott Limited
• VacayHero
• Blueground
• ZeStay
• StayAlfred
• The Plum Guide
• Domio
• Lyric
• WanderJaunt
• Nestpick
• StayOne