As summer approaches, we’ve reviewed the latest trends in the Cape & Islands vacation rental market. Each year, demand for last-minute bookings increases in late spring, and this year is no exception. In May alone, vacationer traffic to our site was up 18% compared to the same period in 2024, signaling strong interest.
With the school year nearing its end, we anticipate a continued uptick in summer bookings as vacationers finalize their plans. Rental activity remains robust, with steady inventory levels and signs of rate stabilization after several years of significant growth. Initial asking prices are just 1.0% higher than last year—suggesting the market is adjusting after recent periods of near double-digit increases.
Bookings
Bookings for the May through October 2025 season are tracking positively. Overall, they are up 5% from 2024 and 1.2% above 2023.
Regionally, all areas across the Cape & Islands are outperforming last year’s pace, reflecting broad-based demand across the market.
What’s driving this strong vacation rental market? After a few slower months due to economic uncertainty, booking activity rebounded in May and remains strong into June. A key factor is the large number of loyal vacationers who return to the Cape and Islands year after year, providing a dependable foundation for demand.
Inventory and Occupancy
Following several years of post-pandemic growth, short-term rental inventory has leveled off in 2025, remaining consistent with last year’s supply.
A review of occupancy rates for peak summer weeks shows performance ranging from -1% to +3% compared to the same weeks last year. Notably, the final two weeks of August—which are historically the most challenging to fill and tend to book later—are seeing the most significant gains, with occupancy up 4–5%. This uptick may be driven by the relative affordability of late-summer stays, as travelers seek value toward the end of the season.
Some summer weeks are more popular than others, highlighting the need for tiered pricing. On Cape Cod, late July to mid-August is most in demand, while on the Islands, August is generally more popular than July. The last week of August is the hardest to rent due to earlier school start dates and should be priced lower from the start to avoid last-minute price reductions or vacancies.
Shoulder season pricing should reflect lower demand and higher supply, especially in the fall when vacation conditions are ideal but fewer families can travel. Smaller homes tend to rent better during this time, while larger homes (4+ bedrooms) are harder to fill.
To attract bookings, consider:
- Offer lower rates—potentially up to 50% less than peak season rates.
- Allow shorter stays with a higher daily rate to make them profitable.
- Be flexible with pricing and minimum stay requirements, especially for larger homes.
Demand
The chart below illustrates 2025 vacation demand, capturing bookings made from last fall through Memorial Day. While the pandemic years saw an exceptional surge, current demand remains stronger than pre-pandemic levels.
As we move into June, last-minute bookings are expected to rise. Historically, June, July, and August consistently see higher booking activity compared to the spring months.
Pricing Trends
At the start of the year, initial rental rates were just 1% higher than in 2024—signaling growing market resistance after several years of near double-digit increases.
However, as the season progressed, prices began to soften earlier and more substantially than usual. Some properties saw rate reductions as early as January, and by late spring, discounts of 10% or more were common. This shift reflects a broader trend toward price stabilization as the market adapts to evolving traveler demand.