Travel Restrictions Reign Supreme
For most people around the world, traveling to Australia or New Zealand right now is nearly impossible. There are only a few daily international flights into both countries per day and arriving passengers must pay to quarantine in a hotel for at least 2 weeks before being able to explore on their own.
These strict restrictions have prevented travelers from visiting Oceania, and with no clear “reopening” path forward, most people aren’t planning trips down under anytime soon.
While there may not be any international travelers arriving, the recent creation of the “Trans-Tasman Bubble” allows for residents of New Zealand and Australia to visit each country without the need for quarantine. This new easing of restrictions looks promising for the travel industry in the region; however, government officials have warned that any rise in cases could bring back heavy travel limitations.
Domestic Travel Impacts
These restrictions have had a serious hold on the travel industry over the past year, but there's promising data for property managers in both Australia and New Zealand when it comes to domestic travel trends.
As the positive news surrounding vaccinations and low COVID-19 case counts continue to develop, property managers have their sights set on the rest of 2021 and how their market may be impacted.
We’ve compiled data from five markets in Australia and New Zealand to take a look at the latest trends: Adelaide, Auckland, Gold Coast, Perth, and Sydney.
Booking Lead Time
Analyzing bookings by their check-in or arrival date is a great indicator of travel consumer confidence into the future. The below chart examines all bookings that have been made for each market over the past 21 days, measured by their check-in date.
In all five markets, most of the recent bookings that have been made are for stay dates over the next few weeks. There is demand that extends into June and July, but the majority of bookings are for stays in the short term. Tourists are clearly showing here that there is demand for travel over the next few weeks, likely driven by the recent lifting of local travel restrictions and pent-up domestic travel demand.
Making bookings for stay dates beyond June 1st may seem riskier to travelers depending on cancellation policies and the many unknowns and warnings surrounding updated travel restrictions.
For more information on how cancellation policies can impact booking pace, check out our advice on policy optimization.
Pacing Towards a “Normal” Year
Historical data remains a very important part of any revenue management strategy, although some 2020 data may not be as helpful as previous years. In the charts below, we have compiled booking data from both Australia and New Zealand to review how booking lead time for bookings made over the past 21 days compares to the same period in 2019.
This comparison helps provide context to how the rest of 2021 is shaping up compared to a more “normal” year after 2020.
In Australia, bookings made in the short term (arriving over the next few weeks) are slightly outpacing the same time in 2019—a good sign of recovery and the impact of pent-up demand on the travel industry.
Additionally, this chart shows that even at this point in 2019, there were not many bookings coming in after mid-July. Property managers need not worry about booking pace for dates past that point, since the overall country is on pace with 2019.
Similar patterns can be seen in New Zealand, with recent bookings outpacing 2019 by check-in date as pent-up travel demand slowly returns. There are some weeks throughout the next few months where 2019 pace is ahead of 2021, but on average, booking pace is not far off in 2021 compared to 2019.
It will be important for revenue managers to ensure that this booking pace continues as tourists get more clarity on what travel restrictions will look like throughout the rest of the year.
“Normal” Event Demand
We recently posted about Sydney Pride returning with in-person attendance back in March, and the impact of more “normal” events returning to markets around Australia and New Zealand. Major events can be some of the largest demand drivers for short term rental markets, and the loss of such events over the past year has had an enormous impact on business.
Some of these recurring events in Australia and New Zealand have been returning, albeit with restrictions on attendance, travel, and more. Property managers should expect a noticeable increase in demand as events return, although demand will likely stay below previous years due to larger restrictions on international travel to the region.
National and local travel restrictions have had a big impact on the vacation rental industry over the past year, and they are likely to continue to shape travel demand throughout the rest of 2021. Even as travel restrictions ease up, government officials have made it clear that stricter guidelines may return if COVID-19 data shows a need for them.
Be sure to stay up-to-date on what is happening within your local market and also in other markets that tourists may be arriving from. For more information on your property portfolio and local market data, check out our Insights tool today.