Short-term rental supply in key hotel markets is up 24%
Across the key hotel markets we've mapped, short-term rental supply is up 24% at the end of 2023 versus 2022. Riyadh, London, Mumbai, Sydney and Delhi have shown the greatest growth, each exceeding 40% increase in short-term rental properties.
Regionally, supply has increased most in EMEA markets (31%), followed by Asia Pacific (19%) and Latin America (18%), with North American destinations seeing least growth on average (9%). As short-term rental supply grows, so does its competitive relevance. It's important to have visibility over your complete competitive landscape, and reflect it in your strategy.
Short-term rental prices are growing faster than hotels
While the average change in rates for Q4 year over year was +16% across all of the markets we looked at, hotels averaged at 11% growth compared with 21% in 1 bedroom short-term rentals. This indicates that the gap in price points between hotel and STR is closing*.
On average, hospitality rates in Asia Pacific have grown the most (+32%). However, the growth rates in Europe, the Middle East and Africa (+13%), Latin America (+11%) and North America (+8%) were slightly lower, but nonetheless positive.
Tokyo and Singapore represent the highest increase in pricing, whilst San Diego, Istanbul and Honolulu were the only markets we explored that saw a decline, albeit relatively marginal. *note that you shouldn't directly compare sector rates due to the way that they are collated.
...but occupancy on the books has grown more in hotels
Occupancy on the books for Q1 2024 is 17% higher than it was for Q1 2023 in hotels. In short-term rentals meanwhile, it was 6% lower. It shouldn't be overlooked that in line with its longer booking window, the short-term rental sector still shows more occupancy on the books at 28% on average compared with 17% for hotels, and also that short-term rentals saw a large increase in occupancy in 2023.
Looking at destinations as a whole, Singapore and New York have grown the most in occupancy on the books for Q1 versus 2023, while Phuket and Sydney are enjoying the greatest absolute occupancy on the books.
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