How Investors Can Profit From 2017’s Record-Setting Foreign Tourism Spending

by | BiggerPockets.com

Given the current political climate, I was surprised to learn that inbound international tourism to the United States isn’t just growing; it’s skyrocketing. According to a recent Skift article citing a National Travel & Tourism Office report, “International travelers spent $20.8 billion on travel to and within the United States in April, more than a three percent increase over April 2016” and, “The first four months of 2017 are the highest for foreign tourism spending on record.”

That’s great news for anybody who works in hospitality, and it opens the door to an emerging market for anyone lucky enough to have a few truly premium vacation rentals in their portfolio.

travel-for-free

Related: 4 Tips to Balance Out the Highly Seasonal Nature of Vacation Rentals

High Income Travelers Opt for Vacation Rentals Over Hotels

According to a 2017 YouGov Affluent Perspective report on the vacation rental industry, an increasing number of high-income international travelers are opting for vacation rentals over hotels. Nearly 60% of affluent travelers from the Middle East, where Millennials make up 50% of the wealthiest individuals, have stayed in a vacation rental in the past year. Coming in a close second, 50% of Europe’s wealthiest travelers reported staying in a vacation rental in the past year—with a whopping average stay of 12 nights.

As more international travelers pour into the United States, it’s not surprising to learn that the younger and wealthier among them are avoiding hotels. In YouGov’s study, nearly three quarters of the world’s global affluent reported that they find premium hotel experiences to be more similar than different. The world’s wealthiest travelers don’t want to be bored. In addition, respondents reported that they prefer vacation rentals because they offer more space (44%), more privacy (37%), and better location (31%).

airbnb-tips

Related: 4 Must-Ask Questions to Answer Before Purchasing a Vacation Rental

An Increase in Medical Tourism

The global elite travel whenever they want, for whatever reasons they want. One of those reasons is medical tourism, when patients travel for operations and procedures they don’t want performed by doctors in their native country. In April of this year, spending related to medical tourism in the United States shot up more than 9 percent year-over-year. If you’re a wealthy patient recovering from an appendectomy, would you rather rest up in some hotel room or in the comfort of a vacation home, where your caretakers can cook in a private kitchen while you enjoy a view of the beach?

Regardless where in the world you operate, make sure your marketing strategy considers international guests. You might just hook a big fish who falls in love with your property and gives it the golden Instagram share.

What’s your plan to profit from increased foreign tourism?

Leave your thoughts below!

About Author

Shaun Greer

Shaun Greer currently serves as the senior director of real estate at Vacasa and is responsible for the in-house real estate activity and broker/agent partnerships for the company. He brings more than 12 years of experience in mergers and acquisitions, joint ventures and public and private partnerships to this role.

A licensed real estate agent, Shaun leads Vacasa Real Estate, a program launched within the parent company in 2018. Vacasa Real Estate is a network connecting leading real estate agents with buyers and sellers of vacation properties. Vacasa Real Estate currently partners with agents from over 80 leading real estate companies such as Berkshire Hathaway, Century21, Coldwell Banker, Keller Williams, RE/MAX and Sotheby’s.

Shaun has been with Vacasa since 2015 and has held several positions including director of corporate development and mergers and acquisitions manager. When not cultivating relationships within the vacation rental industry or using data to support decisions, he is enjoying time with his family and outdoor sports.

2 Comments

  1. Alex R.

    The political climate is a actually helping this record setting foreign tourism spending a swell as better quality health care offered in the US compared to the rest of the world.
    Seems Tourist feels safer in the USA than other parts of the world considering all the recent terror attacks. So they would rather visit and spend in a safer and more stable country.

  2. James Wilson

    Nice article! It really gets you thinking about vacation rentals as a profitable investment strategy, especially with the rise of sites like Airbnb that make it easy to market. I would be interested to learn more.

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