Developments in Ukraine have thrown into doubt the prospect of a full recovery of the short-term leasing market in 2022, including the departure of online platforms such as Airbnb from Russia. In a new analysis, monitoring company AirDNA reports that these developments are going to brings back uncertainty in the market across Europe.
It may be too early to draw any safe conclusions for now. Up until January, the picture of a rapid recovery in the market had been taken for granted, as 14 out of the 20 countries AirDNA surveys recorded a rise compared to the same month in 2019, that is before the outbreak of the pandemic.
The rise in demand in Greece (based on booking numbers) reached 36.6%, which was the fourth highest in Europe. The highest was Russia with 45.1%, followed by Croatia and Austria. France reported a significant 30.5% rise.
There remains a significant difference in the recovery of holiday destinations with that of major cities, with high-interest spots posting an annual increase of 70%, while cities remained 42.7% below the mark set in January 2019. The biggest decline was in Amsterdam (78%), Dublin (72%) and Prague (69%), but Athens only showed a 20% decline from three years earlier, highlighting its rapid rebound after the pandemic.
In any case, it is clear that a prolonged war in Ukraine will upset global travel and could lead many travelers away from a series of countries close to Ukraine and Russia, or even throughout Europe. Bookings over the next few months are likely to show considerable fluctuations and instability, a trend also recorded during the pandemic.
According to AirDNA, both Russia and Ukraine are relatively small markets for short-term rentals: The Russian market only accounts for 2.9% of demand across Europe and for 1% of revenues, while the Ukrainian one for just 0.6% of European demand. Nevertheless, the survey notes that the unfolding conflict could provoke a significant change in cross-border travel, just as it started to recover from the ebb in the pandemic.
Still, for March and April, bookings remain 4.3% higher in Europe compared to the same period in 2019. Barring a protracted conflict in Ukraine, the sector should beat its 2019 figures.