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According to Statista, the vacation rentals market is expected to grow 7.5 percent annually over the next five years. That's because accommodations like a vacation rental or vacation home offer amenities, such as kitchens and multiple rooms at a lower per-night cost than hotels.

Before you book your holiday accommodations, consider which choice would be best for your trip — and your wallet.


Best for: Travelers who can book ahead and are visiting family or friends for only a couple of nights.

Pros: With many hotels offering 24-hour staff, there's convenience for travelers who don't know when they're going to arrive or what they may need during their stay. On-site restaurants and bars, housekeeping, concierge and in-room dining services help a vacation feel like a vacation. Plus, hotel cancellation policies are often friendlier than those of vacation rentals. Sometimes there are even extras like parking and breakfast.

Cons: During the holidays, hotels tend to book up fast and can get expensive, especially for long-term stays.


Best for: Families visiting a relative's house that doesn't have enough guest rooms, as well as travelers who intend to use accommodations primarily for sleeping.

Pros: Hostels aren't just for college students anymore, budget-friendly hostels exist for adults, too. Many hostels offer private rooms in addition to shared living spaces like kitchens and laundry. Typically speaking, they encourage interaction between guests from around the world.

Cons: You'll want to compare costs against a hotel; sometimes a private room at a hostel costs just as much as a hotel and you may still end up sharing a bathroom. If you opt for dormitory accommodations, consider the security of you and your belongings. The staff are also less like concierges and more like a building coordinators.

Vacation Rentals

Best for: Families, including multi-generation families and multiple families, who need more space and want a kitchen to save on food costs. During the holidays, rentals allow extended families to come from all corners of the world to one, middle-ground home.

Pros: Vacation rental sites like Airbnb, FlipKey, HomeAway and VRBO list individual rooms (perfect for solo travelers who want a little extra space from family during the holidays), as well as entire houses and apartments. Some hosts interact with you, offering tips on how to live like a local. You can often find rentals that offer laundry and parking, as well as other extras like a pool, hot tub, sauna or bikes that you don't have to share with a gazillion hotel guests.

Cons: Many rentals require a minimum-night stay. Sometimes, owners cancel right before you're supposed to arrive. Check reviews — Airbnb automatically shows when a host cancels a reservation. It can also be a pain to find a time that works for you and your host to exchange house keys and may be stressful if your host isn't reliable.

Vacation Home

Best for: Families that visit the same destination every holiday season. Add up the costs of your annual trips and see how that cost compares to a vacation home mortgage.

Pros: You know what to expect, as your home is always waiting for you — no need to worry about booking far enough in advance to secure your travel dates. You can also pack less, knowing what items are already in your home. Plus, you can list the property on a site like Airbnb to offset monthly mortgage payments.

Cons: If you list the property on a vacation rental site, you need to find someone to manage it. The upkeep headaches may offset the point of a relaxing vacation home.

No matter what option you think makes the most sense for your holiday travels, be sure to compare costs. You may find a hotel deal for a long-term stay or a low price on a last-minute, short-term vacation rental.

This information and recommendations contained herein is compiled from sources deemed reliable, but is not represented to be accurate or complete. In providing this information, neither KeyBank nor its affiliates are acting as your agent or is offering any tax, accounting, or legal advice.

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