The Economics of Vacation Rentals: 5 Coach Tickets Don't Equal a PJ!

You can't go from coach to private just by buying 5 tickets, but isn't it incredible that for far less than 5 hotel rooms, you can score your own private resort? 

Vacation Rentals are an absolute steal if you know how to play the game right.

If you're here, you're on to something. Let's take Palm Springs as an example:

Right now, the most basic room at The Parker Palm Springs clocks in at $562/night for the weekend of 11/12/15. If I wanted to come in with a group of 10, we're talking $2810/night for 5 basic rooms before hotel taxes and resort fees. There's no guarantee that the rooms would be near one another and everything outside of those rooms is shared with other guests at the hotel.

Palms at Park, Villa 70  5 Hotel-Style Bedrooms with Private Baths

Palms at Park, Villa 70

5 Hotel-Style Bedrooms with Private Baths

Conversely, if I rented one 5-bedroom, 6-bathroom Palms at Park villa for that weekend, we're looking at $1195/night, a whopping 57% less than I would spend at the Parker.

How can this be? There's no compromise on the rooms. Each one has a private bath, hotel style bedding and amenities. Oh, and by keeping $1615 in my pocket each night of my stay, I get a completely gated and private 10,000 square foot resort, massive indoor and outdoor living spaces and my own 40 foot pool, spa and fire pit. 

What's with the dramatic disparity in pricing?

Well, I have no idea. But my best guess is that it's driven by quality risk. When guests book The Parker, they know what they're going to get - it's managed by Starwood and they generally do a great job. It's the Starbucks for the travel weary and coffee deprived. 

Vacation rentals are often a gamble. The pictures look nice but what am I going to get... really? What if it's old? What if it's gross? What if the pillows are like boulders and the sheets are sandpaper?!

We're taking the gamble out of Palm Springs vacation rentals.

We set out to eliminate vacation rental compromise when we designed the architectural plans for Palms at Park in 2013 and our guests have been thrilled since we opened this past March. There's obviously a demand for fine hotel quality and vacation rental privacy and we're thrilled to have exceeded expectations.

I'm not sure how this all nets out. Will more high quality vacation rentals emerge? Maybe. Will hotel management companies start to play a larger role? Probably. Will some owners still put stanky pillows and nasty sheets in their rentals? Oh most definitely.

We're just happy to be a part of something new and exciting. The gap will close but right now we're happy to be able to offer incredible memories and quality for less.