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Oxford Square. Photo courtesy of Visit Oxford

Cash cow on a cul de sac — Oxford homes getting top rental rates for Ole Miss football weekends

Hotel market inventory finally meeting demand

 

 

By TED CARTER

KINNEY FERRIS

Home is where the heart is, but it’s also where the money is for Oxford residents willing to rent out their pads on Ole Miss football weekends.

Accommodating the lodging needs of out-of-town game-goers is so popular, in fact, that the short-term rental Web-based operator Vrbo has designated the municipal home of the University of Mississippi Number Seven among its top 10 U.S. college towns. Vrbo based the selection on average nightly rates and vacation rental demand.

The top spot went to South Bend, Ind., home of the University of Norte Dame, followed by Ann Arbor, Mich., home of the University of Michigan.

Tuscaloosa, Ala., home of the University of Alabama, received a third-place ranking. Tuscaloosa was one of four Southeastern Conference towns to make the Top 10. It joined Oxford, Number Five Auburn, Ala., home of Auburn University, and Number 10 Fayetteville, Ark., home of the University of Arkansas, on the list.

Oxford at Number Seven is sandwiched between Blacksburg, Va., home of Virginia Tech University, and College Station, Texas, home of Texas A&M University.

In terms of house money, Oxford vacation home rentals last season spiked to an average nightly rate of $675 during Ole Miss home game weekends, Vrbo reports. On those weekends, vacation rental demand increased by over 750 percent over non-football weekend rentals, according to Vrbo, a member of the Expedia Group and formerly HomeAway, a pioneer in Internet-based short-term vacation rentals.

Residents can rent out their dwellings for 14 nights a year before Lafayette County’s 2 percent bed tax kicks in.

Vrbo competitor Airbnb has listings for Oxford houses and condominiums ranging from the low $300s to around $650 nightly. “You’re checking out Lafayette County at a popular time,” a spokesman said in an email. He added that searches for Ole Miss home game weekends have increased 94 percent over the average searches over the last year.

Airbnb, the spokesman said, “has a diversity of housing options available in Oxford for football fans. Football weekends are a great example of the economic opportunity Airbnb unlocks for hosts and neighborhoods in Lafayette County, in addition to giving guests the opportunity to stay, and experience new parts of the area,” he said.

Both of the short-term vacation rental brokers charge a fee, which they say is typically covered by the nightly rate.

The dwelling owner sets cleaning fees and security deposit amounts, said Nola Lu, spokeswoman for Vrbo.

Even with the cleaning fee, Lu said she thinks out-of-town visitors get “more bang for your buck” with the weekend home rentals than with conventional hotel lodging.

Vrbo helps the lister set a realistic rate based on rentals of similar properties in Oxford. “All homeowners who list have access to a lot of different tools,” Lu said. “They can set a price competitively based on what the market looks like as far as supply and demand and what others are charging.”

Photo advice and help writing a description of the home are part of Vrbo’s service offerings, Lu noted.

Nick Minerd of the Tennessee-based lodging research firm STR said he took one look at the spread sheet on hotel occupancy and rates for Oxford last football season and could tell the home games instantly. “Without matching up against the Rebels’ schedule, I think it’s pretty obvious which weekends were home games,” he said of 2018.

Last year’s 5-8 Ole Miss team hosted such cupcakes ss Southern Illinois, Kent State and Louisiana-Monroe as well as multiple National Championship winner Alabama, in addition to other SEC rivals Auburn, South Carolina and Mississippi State.

STR tracking for the Sept. 7-8 home game weekend with Southern Illinois brought hotel occupancy of 64.3 percent for the Friday and 78.9 percent for Saturday.

Revenue per available room the Friday before the game fell 10.3 percent compared to the same date a year ago, to $135.67. For the Saturday game day, RevPar rebounded to $164, a 10.8 percent increase over the same day a year ago, STR reports. RevPar, a performance metric used in the hotel industry, is calculated by multiplying a hotel’s average daily room rate by its occupancy rate.

By contrast to Southern Illinois, Alabama’s Sept. 15 visit nearly maxed out the Oxford hotel market, with 92.1 percent occupancy on the Friday before the game and 94.1 percent on game day.  Those two days represented occupancy increases of 52 percent and 54 percent, respectively, over the same dates in 2017.

RevPar figures show how profitable a weekend visit from Alabama can be. RevPar climbed to $384.51 for the Friday d $406 for the Saturday.

Auburn on Oct. 20 drew even stronger occupancy, with 94.4 percent of rooms filled on the Friday and 95.2 percent for the Saturday.

Are the likes of Vrbo and Airbnb cutting into bookings of Oxford’s slightly more than 1,000 hotel rooms?

STR analyst Jan Freitag said he has not seen evidence of this in Oxford, or elsewhere in the country. “Your mileage may vary,” Freitag cautioned in an interview. “But on the national level we have not observed that,” he added of vacation rentals pirating business from the commercial lodging sector.

He said he has seen some “wild swings” in occupancy but doesn’t have the data to tie occupancy falloff to short-term vacation rentals.

Meanwhile, nothing brightens up Oxford’s tourism-development tax ledger like Ole Miss football weekends, said Kinney Ferris, deputy director of Visit Oxford, the city’s visitor promotion arm.

“We do a lot of marketing to the away teams,” Ferris said. “They become ambassadors” for Oxford visits back in their hometowns, she added.

Big draw Alabama won’t visit this year. But, Ferris noted, “This year the Cal game is kind of shaping up to be one of our bigger ones. A lot of people (from the Cal fan base) are choosing to have an experience in the Southeast. We’ve had a big spike in hotel reservations for that weekend.

Ole Miss hosts the University of California-Berkley on Sept. 21.

“The Texas A&M fan base travels well,” and they will come to Oxford on Oct. 19. “LSU is here in late November,” Ferris said. “I expect that will be a pretty good game.”

Ferris said she is unsure how big a bite Vrbo and Airbnb take out of Oxford’s commercial lodging market. “I think the hoteliers would say it certainly isn’t helping their business,” she said in an interview.

Some of the drop off could be from demand falling short of a supply that has increased by 550 new rooms in the past four years.

Here’s a breakdown on Oxford’s lodging inventory and the changes in the last few years:

» Hotel Inventory before 2015: about 800 rooms;

» 2015 — Graduate Oxford added (first boutique hotel) bringing room count to 925;

» 2016 — Courtyard Marriott added, bringing room count to 1,050;

» 2017 —  Chancellor’s House (2nd boutique hotel) and Home2Suites (extended stay by the new Baptist Hospital) bring the room count to 1,177

» 2019 — Oxford will see the opening of Tru by Hilton and LaQuinta, which will add another 185 or so rooms, increasing the total to around 1,361.

With all these new rooms, said Ferris, “There’s no longer the standard answer of ‘no availability’ for home games.”

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About Ted Carter