Introduction: The Importance of High Airbnb Occupancy Rates for Property Investors
For property investors in the serviced accommodation sector, identifying properties with high Airbnb occupancy rates is critical to maximising profitability. With the short-term rental market becoming increasingly competitive, knowing how to evaluate potential investments effectively is more important than ever. In this comprehensive guide, we’ll explore the key strategies for identifying properties that promise strong Airbnb occupancy rates. By understanding market trends, analysing local factors, and leveraging expert insights, you can make informed decisions that lead to higher returns on your investments.
1. Analysing Nearby Comparables on OTA Websites
a. The Value of Comparable Listings
One of the most effective ways to gauge the potential occupancy rate of a property is by analysing nearby comparables on Online Travel Agencies (OTAs) like Airbnb, Booking.com, and Vrbo. These platforms offer a wealth of data that can provide insights into how similar properties in the same area are performing. Look for listings that match your property’s size, amenities, and location to get a realistic picture of what you can expect in terms of occupancy.
b. How to Conduct a Thorough Comparison
To conduct a thorough comparison, start by searching for properties in the same neighbourhood as your potential investment. Filter your search to include properties with a similar number of bedrooms, bathrooms, and amenities. Pay close attention to the occupancy calendars of these listings—are they frequently booked or do they have large gaps? High occupancy rates in comparable properties indicate strong demand in the area, which bodes well for your investment.
💡 Pro Tip: Use tools like AirDNA or Mashvisor to analyse occupancy data across multiple OTA platforms. These tools aggregate data from various sources, giving you a comprehensive view of market performance.
2. Leverage Local Insights from Operators and Property Managers
a. The Importance of Local Knowledge
Local operators and property managers often have a deeper understanding of the market dynamics that influence occupancy rates. They can provide invaluable insights into factors like seasonal demand, popular booking trends, and the types of guests that frequent the area. Engaging with these professionals can help you gain a clearer picture of whether a property is likely to achieve high occupancy rates.
b. How to Connect with Local Experts
Start by reaching out to property managers who operate in the area you’re considering. Ask them about their experiences with similar properties, their average occupancy rates, and any challenges they’ve faced. Local serviced accommodation operators are also a great resource—many are willing to share insights in exchange for reciprocal knowledge or partnerships.
💡 Pro Tip: Attend local real estate or serviced accommodation networking events. These gatherings offer a great opportunity to meet and learn from professionals who have first-hand experience in the area.
3. Evaluate Proximity to Key Attractions and Transport Links
a. The Impact of Location on Occupancy Rates
Location is a critical factor in determining the success of a short-term rental property. Properties that are close to key attractions, transport links, and amenities tend to have higher occupancy rates. Travellers often prioritise convenience, so a property that offers easy access to popular destinations is likely to attract more bookings.
b. Key Location Features to Consider
When evaluating a property’s location, consider the following:
- Proximity to Tourist Attractions: Properties near popular tourist sites, parks, or cultural landmarks tend to perform well.
- Access to Transport Links: Locations close to train stations, bus routes, or airports are attractive to both leisure and business travellers.
- Nearby Business Hubs: Properties near business parks, conference centres, or hospitals can benefit from a steady stream of business travellers and professionals attending events or training.
c. Practical Steps for Location Analysis
Use online tools like Google Maps to assess the proximity of your potential property to these key features. Additionally, visit the area at different times of the day and week to get a sense of traffic flow, noise levels, and the general atmosphere.
💡 Pro Tip: Check local development plans through municipal websites. New infrastructure projects or business developments can significantly enhance the desirability of an area, leading to higher future occupancy rates.
4. Monitor Competitor Calendars and Pricing Strategies
a. Understanding Competitor Activity
To identify properties with high Airbnb occupancy rates, it’s essential to monitor what your competitors are doing. By checking the availability calendars of nearby listings, you can gauge how well they are performing in terms of bookings. If a competitor’s calendar shows consistent bookings, this indicates strong demand in the area.
b. Analysing Pricing Strategies
Competitor pricing can also provide valuable insights. Properties with similar characteristics that command higher prices and still maintain high occupancy rates suggest a robust market. Tools like PriceLabs or Beyond Pricing can help you track pricing trends and adjust your strategy accordingly.
c. Practical Steps for Competitor Monitoring
Regularly check the availability of similar listings in your area. Use a spreadsheet to track dates, occupancy levels, and pricing over time. This will allow you to spot trends and make data-driven decisions about your investment.
💡 Pro Tip: Subscribe to newsletters or reports from local tourism boards or travel companies. These often include insights into occupancy trends, which can help you refine your strategy.
5. Speak with Local Serviced Accommodation Cleaning Companies
a. Why Cleaning Companies are a Goldmine of Information
Local serviced accommodation cleaning companies are often overlooked as a source of valuable market data. These companies have direct insight into the activity levels of properties in the area based on their cleaning schedules. Frequent cleaning requests typically correlate with high occupancy rates.
b. How to Approach Cleaning Companies
When speaking with cleaning companies, ask about their busiest periods, the types of properties they service, and any patterns they’ve noticed in the area. They might also offer insights into the operational challenges you might face, such as managing back-to-back bookings or maintaining high standards of cleanliness.
💡 Pro Tip: Consider establishing a relationship with a reliable cleaning company early on. This can ensure that your property is always ready for new guests, even during peak seasons.
6. Test the Waters by Contacting Local Hotels
a. The Hotel Booking Test
One unconventional yet effective method for gauging occupancy rates in an area is to contact local hotels and attempt to book a large number of rooms on the same day. If hotels are fully booked or only have limited availability, it’s a strong indicator that demand in the area is high.
b. Interpreting the Results
If you find that multiple hotels are fully booked, this suggests that there’s significant demand for accommodation, which could translate into high occupancy rates for short-term rentals as well. Conversely, if hotels have ample availability, it might indicate a slower market or off-peak season, which could affect your property’s performance.
💡 Pro Tip: Use online hotel booking platforms to check availability without having to make direct calls. This can be a quicker way to assess demand in the area.
7. Consider Seasonal Trends and Local Events
a. The Influence of Seasons and Events on Occupancy Rates
Seasonal trends and local events can have a significant impact on occupancy rates. For instance, properties in coastal areas may experience higher occupancy during the summer months, while those near ski resorts will peak in winter. Similarly, local events like festivals, conferences, or sporting events can drive short-term spikes in demand.
b. Researching Seasonal and Event-Based Demand
To identify properties with high potential for Airbnb occupancy, research the seasonal patterns in the area. Look at past occupancy data and consider how local events could affect demand. Websites like Eventbrite or local tourism board sites can help you identify major events that draw visitors to the area.
💡 Pro Tip: Adjust your pricing and availability based on these trends. Offering flexible check-in dates or special packages during high-demand periods can help you capture more bookings.
8. Analyse Historical Data and Market Reports
a. The Power of Data-Driven Decision Making
Access to historical data and market reports can provide a comprehensive view of an area’s occupancy trends over time. Data-driven insights help you avoid potential pitfalls and identify the best opportunities for investment.
b. Sources of Market Data
Use tools like AirDNA, STR Global, or local real estate reports to gather historical occupancy data. These platforms offer detailed analytics on occupancy rates, average daily rates (ADR), and revenue per available room (RevPAR), helping you make informed decisions.
c. Interpreting the Data
Look for trends such as year-over-year growth in occupancy rates or consistent performance across different seasons. Areas with stable or increasing demand are likely to offer better long-term investment opportunities.
💡 Pro Tip: Combine historical data with forward-looking projections, such as upcoming infrastructure projects or economic development plans, to gauge future demand.
9. Engage with Local Real Estate Agents
a. The Role of Real Estate Agents in Market Analysis
Local real estate agents are often well-versed in the dynamics of their market. They can provide insights into which neighbourhoods are in demand, upcoming developments that might affect property values, and the types of properties that are most sought after by both buyers and renters.
b. How to Get the Most from Your Agent
When speaking with a real estate agent, ask specific questions about short-term rental demand, historical property performance, and any emerging trends in the area. They may also be able to provide access to off-market deals or properties that haven’t yet hit the broader market.
💡 Pro Tip: Consider working with an agent who specialises in investment properties or serviced accommodation. Their expertise can be particularly valuable in identifying high-performing properties.
Conclusion: Making Informed Decisions for High Airbnb Occupancy Rates
Identifying properties with high Airbnb occupancy rates requires a combination of market research, local insights, and strategic analysis. By leveraging the techniques outlined in this guide—such as comparing nearby listings, engaging with local experts, and analysing market data—you can make informed investment decisions that maximise your returns.
As an experienced property investor, your ability to identify and capitalise on high-demand areas is crucial to your success. By staying informed, leveraging local knowledge, and continuously monitoring market trends, you can position your properties to achieve consistently high occupancy rates, ensuring long-term profitability and growth.
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