Some call it “bleisure travel,” “laptop lugging,” “workations” or simply “blended travel.” The gist is the same: Remote and hybrid employees extend work trips to include leisure activities or work during their leisure trips. Whatever it’s called, it could upend the traditional divide between leisure and business travel.

The travel lodging industry is already seeing the trend’s impact. Because bleisure travellers’ needs differ from those of traditional vacationers or work trippers, existing lodging options – particularly hotels – can fall short. This has created an opportunity and appears to be fuelling a boom among short-term vacation rentals such as Airbnb.

Quarterly demand growth for short-term rentals has outpaced that for hotels since the first quarter of 2022, when travel began to fully rebound from the pandemic, according to a 2023 report from AirDNA and STR/CoStar, hospitality industry analytic services. This shift reflects changing traveller preferences and the ability of short-term rental hosts to react swiftly to these changes.

“We saw more and more people looking to convert their homes to short-term rentals,” says Jamie Lane, chief economist at AirDNA. “So, supply could be added in an instant. It takes 10 minutes to create a listing, while building a hotel can take years.”

Indeed, the year-over-year growth in supply of short-term rentals has exceeded 15% in every quarter from the first quarter of 2022 through the second quarter of 2023, compared with below 5% growth for hotels, according to the report.

More short-term rentals are available and more travellers are choosing them. How does “bleisure” travel factor in?

A new kind of travel – and traveller

Vacations used to be something that employees squeezed between long periods of work. That’s no longer the paradigm for many office workers with more flexible schedules.

Far from being a pandemic-only trend, the popularity of bleisure travel is increasing. For instance, more than a third of workers plan to do some work on holiday season trips this year (up from 26% during the 2022 holiday season), according to a fall 2023 survey by consulting firm Deloitte.

Importantly, remote employees who planned to work during their holiday trips expected to extend their trips by nine days due to increased schedule flexibility. That is, bleisure travellers are taking much longer trips than they would have if they had to rush back to the office.

This has profound implications for the lodging industry.

“Half of nights booked are now over a week,” Lane says, referring to short-term rental booking data. “And when people are looking to stay longer, there’s a higher propensity for them to book a short-term rental.”

Many short-term rentals offer discounts for extended stays, which is attractive for bleisure travellers. And they provide home-like conditions that make them more comfortable for longer stays.

“They want those amenities – a kitchen, workspace, etc.,” explains Lane.

We can always (not) go downtown

Combining work and play has shifted what amenities travellers seek, and where they’re travelling. While business travel and business hotels are traditionally centred in dense urban cores, bleisure travellers appear to be looking elsewhere.

“The vast majority of hotel supply is in large cities and along the (highway),” says Lane. “The vast majority of short-term rental supply is in the mountains and beaches.”

Indeed, small city and rural destinations saw the largest supply uptick in the first part of 2023, followed by suburban areas, according to the AirDNA and STR/CoStar report.

This has led to another change in lodging preferences.

“We’re not seeing a recovery on shared rooms or studios, they’re still below 2019 demand,” says Lane. “We’re seeing all that demand growth in larger homes.”

Travellers combining work and play are looking for larger accommodations out of major cities that they can rent for longer. All of these changes favour short-term rentals over traditional hotels.

According to Lane, these dynamics are unlikely to shift in the near future as economic headwinds stunt new hotel development, leaving room for the number of homeowners who list their properties on Airbnb to meet demand and fill the supply gaps.

The bleisure travel trend, and its industry-shaking implications, could just be getting started.