2008 Annual Cape Cod & Island Vacation Rental Business Update

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Homeowner prices are up, vacationer demand increases at the start of the Cape Cod & Islands summer rental season.

Now that the Cape Cod & Island vacation rental season for summer 2008 is officially full steam ahead, WeNeedaVacation.com today released for the general public, its 2008 Annual Update on the Cape Cod & Island Vacation Rental Business. In this report, it is shown that Cape & Island homeowners have raised their rental prices 3.0% over 2007, and vacationer demand exceeds that of 2007. From these trends, predictions are cast for the upcoming summer season. A full copy of this report can be obtained by going to http://www.weneedavacation.com/Press/2008-q1.aspx .

How can WeNeedaVacation.com cast predictions so early in the rental season? Vacationer interest spikes so strongly after Christmas that January is the busiest month of the year, with nearly 25% of vacationers making their plans before February 1st. So, seven weeks into the rental season is a great time to look ahead.

As reported in a press release a year ago, "The New Normal," the Cape & Island rental market has stabilized after tumultuous post-9/11 years. But 2008 does show subtle trends: owners show average confidence in the season, as evidenced by a 3.0% average increase in prices. In other words, the average vacation rental will cost $63 more on Cape Cod, and if traveling to Martha's Vineyard or Nantucket, prepare to spend an extra $106 and $130 respectively.

Vacationers launched the 2008 season right after Christmas, as they do every year. Strong early bookings data, showing an increase of 27% (1600 booked weeks), compared to 2007 suggests that the gloomy economic news coming out recently is convincing folks to stay closer to home this summer and to go to Cape Cod and the Islands rather than fly to exotic destinations. Subtle early trends also indicate a preference for larger homes and slightly longer vacations. These bear watching as the season unfolds.

Homeowner Pricing
Homeowner pricing is an indicator of confidence; specifically, how confident homeowners are about renting their homes for the full eleven weeks of the summer season (unofficially, June 21st to August 29th). For the 2008 summer season, homeowners have raised their rental prices 3.0%. This contrasts with a 2.7% increase in 2007 vs. 2006 (see our 2007 report) and 2.3% increase in 2006 over 2005 rates, as stated in WeNeedaVacation.com's 2006 report.

Unlike last year when Outer Cape owners showed the most enthusiasm, all four areas of the Cape show virtually identical increases over 2007. Also, Martha's Vineyard owners, very cautious in 2007, have become more optimistic in 2008.

Whereas homeowner confidence is reflected in relative prices, vacationer demand is reflected in average prices. The data analysis indicates the price diversity on Cape Cod, with a $441 difference between the average price on the Mid Cape and the Upper Cape. The average home on Nantucket is twice as expensive as on Cape Cod!

But how have prices evolved over the years? Since 2004, home prices across the Cape and Islands have steadily increased an average of 4.3% per year, 6.1% on the Islands and 2.7% on Cape Cod.

Vacationer Demand - 2007 Summary & 2008 Forecast
Overall vacationer demand is measured by tracking the number of times the property listings are viewed and the number of emails initiated by vacationers. Looking at the upcoming 2008 rental season, comparing December and January with the same month last year, indicates a 12% increase in visitors. Specifically, property views were up 22% for Cape Cod and a whopping 31% for the Islands; emails were up 10% for Cape Cod and a strong 19% for the Islands. Bookings year-to-date are up 27% overall, with the Islands being the strongest.

About WeNeedaVacation.com
WeNeedaVacation.com is where vacationers go for vacation rentals on Cape Cod, Martha's Vineyard, and Nantucket, and all of Florida. The website's strengths are its state-of-the-art, user-friendly Power Search, which allows vacationers to select homes based on preferred dates, location, price range, and size, and MyVacations, which enables vacationers to save favorite properties and share their vacation with family and friends. Founded in 1997 by Jeff and Joan Talmadge, WeNeedaVacation.com now represents over 4,000 vacation homes, which were viewed more than ten million times in 2007. It is owned and operated by All Seasons Vacation Rentals, LLC of Wellesley, MA.

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Joan Talmadge

John Binder

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