With football season back in full swing, Oxford is feeling the pressure incoming tourists put on the city. As the hospitality industry has been expanding to keep up with growing demand, many residents have decided to become part of the industry instead of just a part of the scenery.
Over the past several years, the private home rental market, “weekend rentals,” has transformed the hospitality and tourism industry in the city of Oxford. Not only do private rentals help alleviate the pressure of accommodating mass amounts of tourists, but they also provide locals with a new opportunity to generate extra income.
“There’s a guy in my neighborhood who rents his house out for $5,000 a weekend because these rich people will pay out the nose for somewhere to stay,” said Richard Gentry, chair of management and entrepreneurship at the University of Mississippi. “It subsidizes the Oxford economy, so the townies head out.”
For the last few years, most tourists have preferred booking through agencies like Airbnb or Vrbo over hotel options in the area. Though this directly benefits the local Oxford residents who own the short-term rentals, it has, until recently, had a negative impact on the Oxford economy, according to Nadia Thornton, sales and marketing manager for the tourism agency, Visit Oxford.
“For years, the 2% lodging tax at hotels, as well as the food and beverage 2% tax, wasn’t being charged by Airbnbs here which hurt the hotels and the economy,” said Thornton. “But now, legislation is helping that.”
Short-term rental owners are now required to charge the 7% state sales tax on the listed price as well as local tourism and economic development taxes. This helps both the city’s economy and tourism agency. In the last year, the hotel tax alone generated $416,253 for the city of Oxford. Prior to the Covid-19 pandemic, that tax generated nearly $480,000 a year. The goal is to have the hotel tax applied to private rentals.
The majority of the tax money is generated during the “busy season” in Oxford — football season. The occupancy percentage for the city increases dramatically during prominent home game weekends. According to a Smith Travel Research report from 2021, the city occupancy rose from just under 100% to almost 280% for the weekend of the homecoming football game. While the influx in population can be difficult to accommodate, Visit Oxford Executive Director Kinney Ferris said that the City of Oxford is dependent on these visitors.
“The consistency of having people here week over week is what drives the economy,” Ferris said. “As wonderful as football season is, the economy suffers when that type of consistent visiting isn’t happening.”
Research showed adding more hotels to the area would help, but would not be sustainable year-round. Currently, there are approximately 1,300 hotel rooms in Oxford according to Ferris. The predictable increase in weekend visitors coupled with the scarcity of rental accommodations created a problem. Locals renting out their own homes to visitors on busy weekends became the solution.
In 2016, Oxford local Ashley Freeman decided to start renting out her home during home football game weekends. That decision changed her life.
“I needed to make ends meet,” Freeman said. “Just my daughter and I lived in a 5 bedroom, 3 bath house, so we started renting it out on the weekends. And it did so well.”
Since she decided to open her home for weekend rentals, Freeman has experienced rapid success. In the last year, she has jumped from managing two weekend rental properties to 35. She currently manages six employees and started a company, Velvet Ditch Villas, that specializes in managing short-term rentals in Oxford.
“Everyone jumped on the Airbnb bandwagon,” Freeman said. “If you have a home you can offer to guests and fans while they visit, why not? The market is booming and you have to be ready to play the game.”
Part of the reason why the short-term rental market is “booming” for owners is because of how much they can charge guests. Because weekend housing options in the city of Oxford are scarce, many owners earn significant income by offering their home as a rental option on a sought-after weekend.
And guests will pay heavily for the privilege of an available rental in a good location. The weekend of Nov. 11, when Ole Miss will play Alabama at home, guests can expect to pay $4,500 a night for a two bedroom condo within walking distance to campus and the Square. If they stay three nights, that’s $10,422 total before fees or taxes.
Deciding how much to charge guests each weekend is a consistent problem for rental owners. Rachel West is the publisher of Invitation Oxford Magazine, and works with the Isom Place in Oxford. She says pricing is a hard issue to navigate.
“One of the main challenges is not overcharging or price gouging people for more sought-after games like Alabama or LSU,” West said. “But when most of our booking happens a year or two in advance, it’s really hard to know what the market will even look like.”
The good news is that there is no shortage of people looking to enter the short term rental market as an owner or investor. Freeman says that weekend rentals have gotten so popular, the market is becoming oversaturated. For the future of Oxford, this means more money and a better ability to house tourists, but also a major problem that could make or break the industry: over-tourism.
The concept of over-tourism is when a location is so crowded with tourists that it becomes miserable. While visiting tourists are important to the Oxford economy, keeping from accommodating more people than the city can handle is ultimately the fine line Oxford must continue to walk.
“It’s the last thing we want for tourists and citizens,” said Kinney Ferris of Visit Oxford. “If we can facilitate more people more adequately, let’s do it. The more the merrier, but we need to be able to do it well. It’s a good problem to have, but we have to do it well.”