How To Launch An Online Rental Marketplace

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When there wasn’t a rental market, do you recall how people used to meet with brokers to select a home to buy? Or do they reserve a hotel room for a quick trip?

Renting a property was a significant business until the first rental marketplace was created.

Thanks to the rental marketplace industry, consumers can now discover housing in just a few clicks.

Over 36% of millennials now live in rental housing, solely in the USA.

Due to COVID-19, working conditions have also changed at the same time. In 2021, more than 70% of workers began doing so. More people than ever before spend their time at home today. So we’re ready to upgrade their living situation. The need for using marketplaces among businesses will increase as a result.

We’ll go through how to create a rental marketplace, its essential features, potential monetization strategies, key development milestones, and pricing in more detail in this article.

What Is A Rental Marketplace?

An online rental marketplace is a platform where people or businesses may exchange offers to rent various sorts of lodgings.

The most well-known marketplaces include Airbnb, Vrbo, Breather, and WeWork. 

Airbnb

Airbnb is a peer-to-peer vacation rental app from the United States.

Airbnb gives its consumers the option to reserve experiences in addition to real estate accommodations.

Activities like cooking with locals, going on excursions, and taking tours led by locals are all examples of experiences. Along with their lodging, the guests must make reservations for such activities.

Vrbo

Another American peer-to-peer renting marketplace is Vrbo.

The business describes itself as a family marketplace that aids in finding a location to unwind, reconnect, and enjoy time together.

Breather

Breather is an online marketplace where people can rent out workspaces. Flexible time frames allow for the reservation of offices for hours, days, or even months.

Offices, conference rooms, and locations with upscale amenities are all included in the service, which is offered everywhere.

How To Build A Rental Platform?

We advise picking a solution type before beginning the product development process, followed by a discovery phase, and ultimately choosing the best technology stack you may require for subsequent product development.

Selecting A Type of Marketplace Solution: Personalized or Ready-made

Ready-made Solutions:

For the speedy construction of smaller marketplace initiatives, the premade marketplace solutions are ideal.

Use open-source and free construction tools, for instance, when you know the platform you’re building will be modest or will just be required for a free and quick depiction of the product idea.

The ready-made free scripts, however, aren’t appropriate for products that require 

• future customization
• feature expansion.
• scaling capacity
• handling heavy loads

Custom Solutions

Projects involving online marketplaces that require specialized business logic and adaptable marketplace features can benefit from bespoke development.

Generally speaking, while building a marketplace, custom marketplace development may require more time, money, and fees than any ready-made alternative. The time required to develop a rental marketplace MVP is shown in the table below as preliminary estimations.

However, as a consequence, it will be a fully functional marketplace with an architecture and features that are tailored to your company’s requirements.

Discovery Phase Execution

You can start the exploration phase after deciding on the marketplace solution type for the upcoming peer-to-peer rental marketplace.

The discovery phase entails a thorough examination of the product concept, a study of the product specifications, and an assessment of potential obstacles and solutions.

You’ll be able to begin comprehending the after its analysis of the:

• Product’s market
• Core objectives
• Platform architecture
• Technology stack
• Appropriate scope
• Potential difficulties or restrictions
• Product attributes
• User experience
• Wireframes

Choose The Best Technology Stack

It is best for your organization to concentrate on MVP growth first when you are just beginning to establish a rental marketplace.

At first glance, it appears that practically any technology may be used to begin constructing an MVP. Looking more closely reveals that selecting the appropriate tech stack for a marketplace should actually take into account a number of factors.

You will require the following technologies to get started:

Scalable

Make sure your marketplace MVP only has the essential functionality when you design it. 

However, you’ll undoubtedly need to develop more extra features both after launch and in the future.

Prepared For Heavy Loads

Large databases and a lot of users are the foundation of rental marketplaces.

When creating such a platform, it is preferable to select technologies that are reliable and prepared to manage the many users and tons of data you will require for your business.

What Is The Price Of Building A Rental Platform?

The quantity of features and their complexity have a significant impact on how much it costs to construct a rental marketplace platform. The features of a rental platform’s minimal viable product (MVP) are as follows, based on our experience with similar projects:

• Authentification
• Find Properties
• Property 
• Booking 
• Reviews
• Profile
• Admin panel
• Notification
• Integrations

For a rental platform with all of these characteristics, the MVP construction starts at $40,000.

The Business Model Of Rental Marketplace

Make sure you understand how you will need to monetize your marketplace and consider its business model payments before you begin constructing it.

Fees, advertising, and premium features are the three monetization models that are most frequently used.

Fees 

The marketplaces impose transaction fees for payments.

For instance, Airbnb levies fees on both hosts and guests. For each successful booking, Airbnb typically receives a fee payment (normally around 3%).

The renters must additionally pay non-refundable service fees, which are typically 15%.

For instance: Redfin and Airbnb.

Ads 

Advertising is a fantastic way to monetize the business models of rental marketplaces. Nobody, however, enjoys too many advertisements. Consider advertising your future monetization strategy and only implement it once you have a committed following.

It’s excellent to work with other businesses, such vehicle rental agencies or providers of tourist activities, and display their advertisements on the rent platform in exchange for additional payment of money.

For instance: Trulia and Zillow.

High-End Services

Rental markets might make money by charging for premium services that provide more functionality.

For instance, if it is a marketplace for holiday rentals, it is conceivable to generate premium listings of the newest housing or provide members with tourist activities they may need once they lease a house for an additional fee.

For instance: Zillow, Trulia, Housing.com, Redfin.

Final Reflections

These days, there is a significant market demand for rental markets. And even if it could seem like a lengthy path at first, it is still worthwhile to begin.

Furthermore, if your goals are established and you are aware of the measures to take, it is simpler to begin developing a rental marketplace. We suggest:

Select the sort of solution from ready-made software or specialized platform development. Starting at $40K, the customized solution can be developed in 4 months.

Conduct the discovery phase to find out more about the key rivals, the target market, and the marketplace objectives.

For greater platform flexibility, scalability, and quicker development, identify the technological stack.

Make a list of features that will give an MVP rental marketplace platform access to all required website capabilities.