Updated : Feb 7, 2025
A Statista study predicts a CAGR (Compound Annual Growth Rate) of 4.62% for the short-term rental industry, with a projected market size of USD 125.60bn and 1.07bn users by 2029. This expansion opens revenue opportunities and even increases competition for STR businesses. Thus, property managers must pay attention to the comp set data to stay ahead. So, what is a comp set?
Whether it’s deciding on home renovations, marketing strategies, or pricing adjustments, comp sets ensure your STR business remains competitive. This regular benchmarking syncs your property with market conditions, which leads to increased occupancy and revenue.
Let’s first briefly understand what is a comp set.
What is a Comp Set for STR Businesses?
A comp set means competitive set. It’s a benchmark for performance analysis of your vacation rental property against its direct competitors in the market. Typically, a comp set includes 5-10 STR properties similar to yours in terms of bedroom count, amenities, luxuriousness and area.
If you don’t know who you’re competing against, you’re leaving money on the table. Having a comp set helps you regularly benchmark your properties against the competition. By analyzing your competitors, you stay on top of market trends like increases or decreases in demand and adjust your pricing accordingly. They also help you understand how to formulate your cancellation policies, which amenities to add, and how much Airbnb cleaning fees to charge. The comp set lets you know your vacation rental’s strengths and weaknesses. Moreover, it helps you plan better marketing and revenue management strategies to improve your overall market positioning.
How to Use a Competitive Set to Make Informed Property Management Decisions?
Understanding and outselling the competition is integral in improving your Airbnb business plan. Consider these four variables to accurately benchmark your vacation rental against your competitor in the target market segment.
1. Identify Target Guest Preferences
Comparing your 6-bedroom luxury short-term rental with a 1-bedroom apartment won’t align with your target guest types and marketing strategies. You’ll always struggle with benchmarking if you apply “apples-to-oranges” comparisons.
Instead, your comp set selection must include a similar location, property type, size, bathroom/bedroom count, services/amenities, and proximity to attractions. Identifying your direct Airbnb competition in your local area lets you know top-performing factors and guest preferences.
Moreover, the correct benchmarking allows property managers to promote similar amenities in their marketing initiatives and attract more guests. Let’s say your comp set shows increased demand for STRs with festive decor during the holiday season. So, consider adding a Christmas tree to make your vacation rental home more appealing and outperform competitors.
Using tools like PriceLabs Market Dashboard, you can create custom comp-sets and analyze how listings similar to yours are performing in your area. You can also analyze which amenities are preferred in your market and add those to your listings.
2. Track Occupancy Rate & Booking Windows
Comparing your occupancy rate with competitors’ properties will help you spot areas for improvement and better allocate resources. Additionally, understanding booking windows allows property managers to predict cash flow and manage inventory more effectively.
Thus, analyzing booking activity and guest behaviours on similar listings is a strategic metric to streamline your occupancy and nightly rates using a dynamic pricing tool. This benchmarking allows you to boost your Airbnb occupancy rate by adjusting your marketing initiatives during low and high-demand periods in your market.
For instance, your competitors begin receiving bookings 45 days ahead of your STR property in peak season. Regularly monitoring your property management KPIs against competitors will allow you to refine your marketing strategies for vacation rental, such as releasing early-bird discounts, to capture this booking window faster.
Create Custom-Comp Sets For Your STR
Without comparing your listing with competition, you would never know if you are making the right revenue management decisions. With PriceLabs Market Dashboards, you don't have to worry about that
Try For Free3. Compare Average Daily Rate & Seasonal Pricing
High per-night costs might lead to lower bookings, while too low rates mean missing potential revenue opportunities. Thus, comparing and optimizing your average rental income per booked night is essential to improve Airbnb rental income.
Analyze how your nightly rates compare with average Airbnb prices during peak tourism, off-peak periods, and local event weekends. Further, consider competitive positioning to identify if your pricing is below or above market value. Closely analyzing ADR for your target competitors enables you to adjust and match competitive pricing as vacation rental seasonality trends shift.
Let’s say your current ADR is $400 while your competitor’s is $418. Since your competitive positioning is slightly below the market average, there’s a potential for increasing rates.
4. Analyze RevPar to Measure Overall Performance
RevPAR (Revenue per Available Room) is another critical variable that reflects the balance between ADR and occupancy. You’ll learn how effectively you’re filling and monetizing available inventory against your direct competitors. Benchmarking your property’s financial performance with similar listings allows you to align your revenue management strategy.
A vacation rental owner shared in a Reddit thread that balancing occupancy with daily rates is an ideal way to maximize income.
This comp set metric also helps you gauge your potential ROI by assessing vacation rental investment costs and financial performance. Hence, you’ll get a detailed insight into your property’s overall profitability.
5. Identify Cancellation Policies and Airbnb Cleaning Fees
Sometimes, a guest may not book your rental because they may not find your cancellation policies suitable. There is also a possibility that you may charging the high Airbnb cleaning fees. Analyzing your comp-set not only helps you with understanding vacation rental KPIs but also helps you formulate suitable cancellation policies and charge the proper Airbnb cleaning fees.
With PriceLabs Market Dashboard, you can see your guest preferences regarding cancellation policies and Airbnb cleaning fees. This will help you ensure you offer a flexible yet secure cancellation policy that can help attract more bookings while setting a reasonable cleaning fee ensures guests feel they’re getting good value without overpaying.
Track And Customize Your Comp Set For Benchmarking with PriceLabs
PriceLabs Market Dashboard is a one-stop solution for identifying your vacation rental’s comp set, improving bookings, and maximizing profits. Its advanced custom Comp Sets feature helps property managers monitor competitor prices and fine-tune their own revenue optimization approach accordingly.
The comprehensive report on PriceLabs data reporting tools covers various metrics to benchmark your performance against competitors’ vacation rental KPIs, including occupancy, booking window, seasonality, ADR, and RevPAR. Data-based insights into your property’s market positioning help understand whether your seasonality pricing for Airbnb is too high, too low, or just right.
Customizing Your Comp Set with PriceLabs
PriceLabs makes this process simple by allowing you to create and modify comp sets based on:
- Property Type (Apartments, condos, villas, cabins, etc.)
- Location (Within the same neighborhood or city radius)
- Amenities (Pool, pet-friendly, parking, etc.)
- Pricing Strategy (Luxury, budget-friendly, mid-range)
- Booking Trends (Peak season demand, last-minute bookings, etc.)
For example, suppose your vacation rental is a 3-bedroom villa with a private pool in Miami. In that case, your comp set should include other 3-bedroom villas with pools in similar neighbourhoods—not studio apartments or high-rise condos.
Frequently Asked Questions
1. How do you identify a competitive set?
Look for vacation rentals that share characteristics with your own, such as location, property size, amenities, target guests, and pricing strategy. Use the PriceLabs Market Dashboard to search for similar listings based on your KPIs.
2. When can a comp set be created?
You must update your comp set every 3-6 months to get the latest market insights.
3. What does RevPAR mean?
RevPAR stands for Revenue Per Available Room, which provides a comprehensive view of a property’s revenue-generating potential. To calculate RevPAR, multiply your vacation rental’s average daily rate by the occupancy rate.
