Hybrid hospitality, shifting regulations and the ‘White Lotus effect’ are changing the way owners deal with their rental properties
Unlike more uniform markets, APAC’s short-term rental (STR) industry is highly localised, requiring a flexible approach to regulation, distribution, and guest experience. “One of the biggest challenges in the region is navigating local regulations, which can vary significantly from one country – or even one city – to the next,” says Yoav Tourel, Managing Director of Guesty APAC. Guesty is aproperty management software (PMS) specifically tailored for short-term rentals, Guesty aims to automate and streamline all operational aspects, including marketing, accounting, payments, bookings, and listings on platforms like Airbnb and Booking.com.
Between evolving traveller demographics and Thailand’s newfound tourism surge thanks to the wildly popular HBO show, White Lotus, businesses in APAC are having to rethink their approach to hospitality and more specifically, short-term rentals. Another key challenge is platform distribution. “OTA dominance varies significantly across APAC, with platforms like Ctrip, Rakuten, and Agoda playing a major role alongside global giants like Airbnb,” says Tourel.
“According to Statista, APAC’s STR market is expected to reach $20 billion by 2025, with significant growth in China, Japan, and Southeast Asia. The ability to scale while adapting to local needs is critical for sustained success,” Tourel emphasises.
Regulatory challenges and the push for compliance
As the short-term rental market matures, governments across APAC are tightening regulations to balance tourism expansion with housing affordability and tax compliance. “Regulation is an inevitable part of the STR industry’s evolution,” Tourel says. “Guesty supports country-specific tax regulations, invoicing, and compliance requirements, ensuring that property managers can remain compliant while scaling their operations,” adds Tourel.
Tourel sees these regulations as an opportunity rather than a setback. “A more stable and professionalised industry fosters trust among travellers, neighbours, and hosts,” he explains. “While the specifics of regulation will vary by market, the long-term trend points toward increased oversight as governments seek to integrate STRs into the broader housing and tourism ecosystem.”
It’s not TV, it’s HBO: Capitalising on Thailand’s ‘White Lotus’ boom
Guesty’s data suggests that demand for luxury and experience-driven stays in Thailand is on a steady upward trajectory.
The concept of “set-jetting” – where travellers visit locations featured in films and television shows – has brought destinations like Phuket and Koh Samui into the global spotlight. “The ‘White Lotus effect’ has undeniably boosted high-end and boutique tourism, making luxury stays more accessible and desirable,” Tourel explains. “The bigger question is whether this is just a short-term trend or a sustainable shift in traveller behavior. If anything, this moment presents a major opportunity for property managers to capitalise on what is essentially free publicity for the region.”
“We expect this momentum to last for at least the next two to three years, driven by demand for curated, highly localised experiences,” Tourel adds. “Additionally, digital nomad policies are making long-term stays more attractive, drawing remote workers who are looking for extended accommodations in culturally rich destinations.”
Property managers looking to capitalise on this trend need to adapt to evolving guest expectations. “Flexible inventory management is becoming essential, as more travellers seek extended stays in destinations like Chiang Mai and Koh Samui,” says Tourel. “The ability to leverage automation to tailor guest experiences, from personalised recommendations to seamless communication, is helping property managers stand out in a competitive market.”
He adds, “high-end hospitality brands are investing more in alternative accommodations, creating a bridge between traditional hotels and short-term rentals. According to CBRE Thailand, the luxury vacation rental market has grown by 40% year-over-year, with occupancy rates in high-end properties maintaining strong performance outside of peak seasons. Property managers who optimise for high-touch experiences now will be well-positioned to retain guests as trends evolve.”
AI-Driven automation is about enhancing efficiency, not replacing hospitality
Artificial intelligence and automation are also transforming property management, but according to Tourel, the key is to enhance – not replace – the human touch.
“The property managers who will benefit the most from automation are those who use it to elevate hospitality, not just streamline operations,” he says. “Guest communication is another area where automation will move beyond chatbots. While AI-driven messaging is already reducing manual work, the future of automation will be adaptive, context-aware, and proactive. Instead of generic responses, AI will work as a co-pilot for property managers, analysing past guest preferences and behaviors to anticipate needs before they arise. This kind of hospitality intelligence ensures that guests feel seen and valued, rather than just processed through a system.”
Revenue management is also evolving. “Instead of just adjusting rates based on seasonality, AI will surface recommendations tailored to specific property types and traveler segments, ensuring pricing strategies align with regional market dynamics,” he explains. “This gives managers the power to make more informed and strategic pricing decisions rather than relying purely on algorithmic changes.”
“According to McKinsey, automation in hospitality can increase efficiency by up to 30%, leading to higher profit margins and improved guest satisfaction. Ultimately, automation is not about removing the human element but rather giving property managers the tools to be more present, responsive, and strategic in their operations,” says Tourel.
The rise of mid-term and corporate housing
A growing trend in APAC’s rental landscape is the increasing demand for mid-term stays. According to Tourel, Guesty has expanded its capabilities to accommodate this shift. “Extended stays of 30 days or more have increased by 42% compared to pre-pandemic levels,” Tourel reveals. “This shift is reshaping how property managers approach pricing, guest engagement, and operational workflows.”
“We’ve introduced flexible rate structures, automated guest communication for extended stays, and partnerships with corporate housing platforms,” he explains. “According to AirDNA, extended stays now make up 20% of total bookings in APAC.” Tourel also emphasises that as flexible travel lifestyles continue to grow, property managers who adapt to this demand will be in a strong position to capitalize on a more stable revenue stream.
The push and pull of OTAs and direct bookings
With OTA commission fees eating into profits, many property managers are now pushing for direct bookings. Tourel says that Guesty is supporting this shift while recognising the continued value of OTAs. “The push for direct bookings has gained momentum as property managers seek to reduce reliance on OTAs and take greater control over their revenue streams,” Tourel explains. “Guesty fully supports this trend by offering tools that help property managers build their own booking channels, including direct booking websites, integrated payment solutions, and dynamic pricing strategies.”
However, he acknowledges the necessity of OTAs. “While direct bookings provide more control, OTAs like Airbnb and Booking.com remain essential for visibility and lead generation,” he says. “The best strategy is a balanced one, leveraging OTAs to attract new guests while nurturing direct relationships to drive repeat bookings.”
“Phocuswright reports that direct bookings now account for 35% of total short-term rental reservations, up from 25% in 2019, and this number is expected to grow. The key is to use technology to optimise distribution, ensuring that property managers benefit from both OTA exposure and a strong, independent booking strategy,” Tourel notes.
The professionalisation of short-term rentals
It’s no secret that the professionalisation of the short-term rental industry has blurred the lines between hotels and vacation rentals; it’s not uncommon these days to walk into a serviced accommodation that’s managed exactly like a hotel.
Tourel highlights that this trend will only accelerate in the coming years.
“More property managers are moving toward standardised guest experiences, adopting hospitality-driven models that offer hotel-like services within rental properties. At the same time, hotel brands are entering the alternative accommodation space, offering extended-stay apartments and flexible inventory models,” adds Tourel.
He explains, “The future of hospitality isn’t about choosing between hotels and short-term rentals – it’s about hybrid hospitality, where the best elements of both models come together to meet evolving guest expectations. Property managers who embrace this shift and leverage technology to deliver seamless, high-quality stays will be well-positioned to lead in the evolving hospitality landscape.”
New trends and newer opportunities in the region
As Guesty continues expanding across APAC, its focus remains on localisation, personalization, and automation.
“One of the most notable trends in APAC, from our own data, has been the 75% YoY increase in listings and reservations in Japan,” Tourel reveals. “Platforms like Airbnb and Expedia have reported strong growth in the region, reinforcing APAC as a key strategic area for expansion.”
As Western cities tighten regulations, Tourel sees companies shifting focus to Japan, Korea, and China. “With demand rising but regulatory challenges remaining, property managers need solutions that provide both operational efficiency and compliance support,” he says.
“Many OTAs have emphasised redistribution, addressing overtourism by driving travellers to alternative destinations and we’re seeing this play out in APAC, where demand is shifting beyond major cities to secondary and rural markets,” Tourel continued. “At the same time, compliance is becoming a critical factor, particularly in Japan and Korea, where regulations require licensing, tax automation, and operational transparency.
“We’re also noticing an uptick in alternative stay models across APAC, including extended stays, co-living spaces, and hybrid hospitality models that combine short- and mid-term rentals. With housing affordability being a key issue in markets like Australia and Japan, property managers are increasingly diversifying their portfolios to capture both leisure and long-stay travellers,” explains Tourel.
