Falling Gasoline Prices are Good News for off-season Luxury Vacation Rental Occupancy
Oct. 7, 2007. Prices of gasoline have already fallen to a level closer to two dollars that three dollars, as we had quoted an analyst as predicting would happen by Thanksgiving in our Aug. 31 blog.The higher prices that vacationers experienced earlier in the year never did have the impact of vacation travel that some alarmists predicted. It was as though Americans were determined not to give up their cherished summer vacations.
As we go through a period that is the off-season for most vacation rentals, the question is how much lower gasoline prices will go, and how much of an impact it will have on fall, winter, and spring tourism. In some areas, gasoline can already be purchased for two dollars or less. As reported this week by the Wall Street Journal (Subscription only), “Gasoline prices have dropped more than 20% in the past two months, providing relief to consumers and potentially propping up an economy that is showing signs of slowing. Industry experts say further price declines are likely.�
The article by Steve Levine and Christopher Conkey goes on to report that, “The retreat in energy prices cuts across the entire sector. Along with oil and gas, heating-oil-futures prices on the New York Mercantile Exchange are 17% lower than a year ago and natural-gas futures are down 58% in the past year. Crude oil has dropped 5.4% and gasoline futures have fallen 21% over that same period.�
As the article says, gasoline prices are volatile and a number of factors could put them on an upward march again. However, we agree with the industry experts who say that further declines are likely.
For the luxury vacation rental industry, this means that you should plan and market for a strong season. There will be an added incentive for couples and families to take short getaway trips in the fall season. This is the time of the year when romance packages and other packages should be promoted.
