World Cup Rental Rates - Knowing how much to charge
I’ve been asked many times to give my opinion on how much extra Vacation Rental owners should charge during the month of the World Cup in South Africa. The answer is a simple case of supply and demand but how do you work out what the supply and demand will be? Here’s some pointers.
1. How many extra visitors will there be?
An estimated 3.5 million people will be traveling to and from the 9 World Cup stadiums during June and July next year. A conservative estimate of 300,000 extra visitors will visit South Africa purely for the World Cup, mainly from Europe and the US. The draw for the finals takes place in Cape Town on December 4, 2009 and this will, in many respects, dictate how many visitors there will be in each of the 9 locations. Look out for England, Germany, Italy and Spain. All of these teams carry a huge following and will create a big demand for bed spaces.
2. How close are you to the stadium?
This is very important. The closer you are the more you can charge. If you are within walking distance then you could possibly charge 100% more than your normal ‘peak’ rate. This rate tails off the further from the ground you are. For example in Kommetjie (35km away) you could be looking at a reasonable 25% increase on your normal rates.
3. How many available beds are there given the time of year?
This is the most interesting factor. For large tourist destinations such as Cape Town and Durban there will be plenty of choice and availability. (Even despite it being popular with visitors from Gauteng at that time). Availability is generally high and depending on the draw, demand for bed nights could be lower than expected, so be sensitive to this factor when selecting your ‘World Cup’ rates. On the flip-side smaller towns like Nelspruit and Rustenburg could be overun with extra visitors, especially if 2 big European teams are drawn to play there. These towns could expect an extra 60,000 visitors for a single game and availability will be scarce. This is actually a concern of the organisors and for the casual renters it could be a great opportunity to make a killing.
And that’s it in a nutshell. Be wary of the draw. Predict the migration of visitors between games and don’t be greedy. It’s best to get an extra 25% than nothing at all. And also fill the beds early. If you decide to leave it to the last minute thinking you can charge a premium then my advice is don’t. It’s a risky strategy and you could be left empty handed particularly in the major towns.
Tags: Cape Town, Nelspruit accommodation, Rustenburg accommodation, World Cup, World Cup Accommodation
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