×

Vacation Rentals May Hold A Key To Vacation Savings

Even with a tough economy, is it possible to snag a deal in Palm Springs on Memorial Day weekend?

Kristen Bergevin, a 35-year old Los Angeles resident who works in a marketing communications agency, wasn't sure it would be possible to fulfill her vacation wishes, but with by taking some extra time to research possible vacation spots she found a great deal. The key: opting for a vacation rental with friends rather than staying in a hotel.

Lake Martin, Alabama
Photo by: Adam Chamness
Lake Martin, Alabama

"I would have to spend at least $300 a night in a hotel, and that’s just the room," she says. "By renting a house, it becomes $250 per person and we get our own rooms, a jacuzzi, and privacy."

With consumers uncertain about the economy, many are forgoing vacations, and leaving deals out there for those who are still traveling.

Renting a house or apartment can allow travelers to maximize their budget. Not only are some property owners cutting prices to attract guests, but more people who own second homes are renting them out in order to cope with the economic downturn. As a result, interest in rental properties is growing.

Online vacation rental sites such as HomeAway.comand VillasOfDistinction.comhave seen a big increase in their traffic.

"Business is growing quite aggressively," says Brian Sharples, CEO of HomeAway.com. "People are still traveling and they are looking for more value."

"People are shopping around more," says Maya Offenbach, Manager of Villas of Distinction. "In the past, they weren't worrying about deals as much."

CNBC.com Original Slideshows:

Sharples says that part of the reason for the increase is the fact that people are having a tough time selling their homes and they have started to see the value on vacation rentals.

"The supply for vacation rental homes has increased dramatically," says Stephen Ferrari, who has owned a five-bedroom vacation home in Duck, N.C., for the past 16 years. "You’ll find a place even if you wait until the last minute."

Still, Ferrari insists that even though there is more supply, the industry is not flourishing. "We have seen trouble," he says. "I used to rent my home 25 or 26 weeks in past years. Now I’ve renting only 15 or 16 weeks."

That may be good news for vactioners. As homeowners have started to be wary that the economic downturn might eventually hurt the business, real estate managers have started to act.

"Our rental manager dropped prices by 10 percent this year," says Shari Hindman, who rents a home in Lake Martin, Alabama. "The recession is on people’s minds."

"It’s a great time for the consumer," says Robert Haupt, a lawyer who represents vacation rental owners in the Midwest and in Florida. "Because of the recession we will start seeing prices drop this summer, and you’ll see lots of deals out there."

Duck, North Carolina
Photo by: Keith Bellvay
Duck, North Carolina

For those who don't wish to gamble on snagging a deal at a popular resort area at the very last minute, try locations that are off the beaten path. Here are a few, lesser known destinations, where the deals are already available:

Duck, North Carolina

Located on North Carolina's Outer Banks, the "cottages"—as they are commonly known locally—can be as big as seven rooms. With balmy summer temperatures and the choice to enjoy the ocean or the bay, Duck is a popular destination.

The prices for a week’s stay range from $2000 to $9000 depending on the location and the size of the house.

Lake Martin, Alabama

This traditional Southern town in Alabama has been well regarded for fishing, swimming and boating.

"Anyone with wealth has come to build here," says local owner Aubrey Hornsvy. "But it’s still economically attractive to families."

Most homes in Lake Martin can be rented as low as $200 per night.

Mt. Hood, Oregon
Photo by: Tony
Mt. Hood, Oregon

Mt. Hood, Oregon

Forty minutes away from Portland, Mt. Hood offers an interesting option for groups looking to leave the beach behind this summer.

"The summer is actually busier than the ski season," says Frank Groff, who owns a cabin in the area. "The topography looks like you’re in a fairy tale. The trees are huge and the mountain is amazing."

The peak summer season extends from May 23 through September 11, and cabins at Mount Hood can cost $250 a night per person.