Airbnbs are more expensive this summer, as are Ubers

(NewsNation) — As Americans head out of town to celebrate the Fourth of July, the cost of getting from point A to point B is high, and this year travelers shouldn’t expect prices to go down when they arrive at their destination.

A record 42 million Americans are expected to take a road trip of over 50 miles this Fourth of July weekend, according to AAA. The organization forecasts another 3.5 million people will travel by air.

The record-breaking travel numbers are yet another indication that consumer demand remains high even as prices continue to rise. That means travelers can expect lodging and ground transportation costs to be higher even after the first leg of their journey.

Lodging

Those looking for a place to stay should expect to pay more for hotels and short-term rentals, both of which have become more expensive this summer.

In part, the price increase is being driven by surging demand as Americans stretch their legs following a pandemic-induced vacation hiatus.

Demand for short-term rentals on Airbnb and Vrbo is up nearly 14% compared to the previous Fourth of July, according to data from AirDNA. Overall, short-term rental demand is up 22% from summer 2019.

The average nightly rate for a short-term rental booked this summer is $351, up 8% from last year, AirDNA found, though some cities have seen Airbnb and Vrbo rental prices rise much faster than the national average. In Chicago, average nightly rates are up 34% from 2021. Gainesville, Florida, has seen prices rise 29% and nightly rates in New Orleans are up 27%.

That means in many places, short-term rentals may be more expensive than those of a hotel, although those prices have risen as well.

Last month, the average nightly rate for a standard double room in Las Vegas was $218, a 37% increase from the year before, according to Trivago. In Chicago and New York, average hotel prices are up more than 90% from the year prior, hitting $361 and $390, respectively.

transportation

Travelers who have become accustomed to affordable transportation through ride-share services such as Uber and Lyft have probably noticed trips are more expensive than they used to be.

“In general, the fares have gone up anywhere between 40% and 100% from the pre-pandemic days,” said Sergio Avedian, a ride-share driver and senior contributor at The Ride Share Guy.

Both Uber and Lyft were hit hard by driver shortages immediately following the pandemic but Avedian said that issue has largely been resolved, although there are some indications rising gas prices may be a factor going forward.

According to a survey conducted in March by The Ride Share Guy, more than 50% of ride-share drivers say they are driving less or quit entirely due to high fuel costs. But even then, Avedian doesn’t think gas prices are the biggest factor when it comes to rising Uber costs.

Instead, Avedian says the new prices reflect a change in Uber and Lyft’s strategies, which are now focused on profitability rather than rapidly acquiring market share.

For years, the ride share giants lost money by providing discounts in order to attract customers. Now, Avedian says passengers will have to get used to paying more.

“I called it subsidized fantasyland. Those days are over. It’s never going to come back,” Avedian said.

Last month, Uber announced the return of shared rides in select cities across the U.S. after suspending the service during the pandemic. Lyft has also brought back its shared service to a number of cities.

The carpool options are intended to be more affordable, albeit slightly less convenient, services for riders.

Avedian said the best thing consumers can do is download both apps and monitor prices; even waiting a few minutes can result in significantly lower fares.