What Airbnb Occupancy Rate Can You Expect in 2022?

Published in

Mashvisor

11 min readJan 28, 2022

Investors who are planning to buy or already have an Airbnb rental are likely wondering what the Airbnb occupancy rate would be like in 2022.

After what was the toughest year for the travel and hospitality industries, things seemed to be looking up in 2021. People were getting vaccinated and thus were starting to feel comfortable with traveling again. By summer, towns and cities that offer outdoor activities were welcoming visitors and so did Airbnb properties in the area.

Meanwhile, those who were allowed to work remotely were taking advantage of their newfound freedom by booking Airbnbs and working from there for at least one month. These two trends were the driving forces behind Airbnb demand bouncing back to, and even exceeding pre-pandemic levels.

But then, before the year was over, a new COVID-19 variant spread throughout the world, causing staffing shortages and full hospitals in the US alone. According to Destination Analysts, 65% of Americans were concerned that they would contract the virus, which led to 41% of them canceling or postponing their trip.

So as another year begins, investors who want to invest or are currently investing in an Airbnb income property are wondering:

Will they have trouble getting bookings as they did in 2020; or,
Will Airbnb statistics 2022 be better than they were last year?

In this blog post, we will share what occupancy rates Airbnb investors should expect in the US in 2022 based on the latest Airbnb data from Mashvisor. We will also discuss the following:

What is a good occupancy rate in the US?
What do occupancy rates by city mean?
Why are occupancy rates at the neighborhood and property levels important?
What can Airbnb investors do to increase their occupancy rate?

Expected Airbnb Occupancy Rate in 2022

To get a good sense of the occupancy rate of Airbnb properties in the US this coming year, we looked at the Airbnb data that Mashvisor gathered from the website itself. Here are the occupancy rates for the 50 biggest US cities:

Note: The cities mentioned below may have varying regulations for short-term rentals. We encourage you to contact the appropriate local government about their ordinances before committing to your purchase.

New York, NY: 68.39%
Los Angeles, CA: 67.21%
Chicago, IL: 56.96%
Houston, TX: 47.49%
Phoenix, AZ: 64.87%
Philadelphia, PA: 60.02%
San Antonio, TX: 54.57%
San Diego, CA: 63.18%
Dallas, TX: 55.27%
San Jose, CA: 57.76%
Austin, TX: 74.50%
Jacksonville, FL: 51.51%
Fort Worth, TX: 56.00%
Columbus, OH: 57.01%
Indianapolis, IN: 56.20%
Charlotte, NC: 57.31%
San Francisco, CA: 71.40%
Seattle, WA: 66.63%
Denver, CO: 71.42%
Washington, DC: 64.04%
Nashville, TN: 57.71%
Oklahoma City, OK: 72.24%
El Paso, TX: 56.25%
Boston, MA: 60.11%
Portland, OR: 73.63%
Las Vegas, NV: 60.21%
Detroit, MI: 50.94%
Memphis, TN: 64.96%
Louisville, KY: 61.17%
Baltimore, MD: 66.23%
Milwaukee, WI: 63.13%
Albuquerque, NM: 62.09%
Tucson, AZ: 67.19%
Fresno, CA: 64.86%
Sacramento, CA: 69.47%
Kansas City, MO: 66.11%
Mesa, AZ: 61.37%
Atlanta, GA: 45.69%
Omaha, NE: 68.22%
Colorado Springs, CO: 64.53%
Raleigh, NC: 62.13%
Long Beach, CA: 72.43%
Virginia Beach, VA: 58.09%
Miami, FL: 59.63%
Oakland, CA: 67.13%
Minneapolis, MN: 67.20%
Tulsa, OK: 63.31%
Bakersfield, CA: 69.19%
Wichita, KS: 55.83%
Arlington, TX: 80.38%

What Does Airbnb Occupancy Rate by City Mean?

Airbnb occupancy rate by the city is the average demand for short-term rentals in each municipality. These depend on several factors like:

Population and number of listings: Big cities tend to have a more stable demand throughout the year compared to smaller towns that tend to fluctuate depending on the season. They also have more Airbnb listings compared to other cities.
Seasonality: Ski towns tend to get more bookings during the winter months, while those by a beach see an increase in demand during summer.
Events: The influx of visitors-and in turn, Airbnb bookings-also happens when there is a local event happening in the area. These may be local festivals, concerts, or conventions.

Occupancy Rates in Major US Cities From 2019 to 2022

In the previous section, we listed the average occupancy rate of each of the 50 biggest cities in the US. Because they tend to have a more stable demand for Airbnb properties throughout the year, they are great indicators for what we can expect in 2022. The list shows that demand can vary from 45% (as seen in Atlanta, GA) to 75% (as seen in Austin, TX). Some cities not mentioned in this list may experience a higher occupancy rate but tend to fluctuate.

Before the pandemic, the 2019 occupancy rate in major cities ranged from 21% to 75%. The following year, our original Airbnb forecast was that the 2020 occupancy rate by the city would range from 27% to 71%. Of course, in the end, the actual numbers turned out to be different. By March 2020, occupancy rates dropped to a low range of 40% to 59% before recovering by an average of 13 points in October.

Then by March 2021, things were looking up. The occupancy rate for the biggest US cities ranged from 42% to 75%, which is close to our figures for this year.

Airbnb Occupancy Rate 2022 at the Neighborhood Level

Knowing the average occupancy rate for each city is a great starting point when deciding which market to explore. However, it may still be a broad area to search for an investment property, especially when you are looking into a big city like Los Angeles.

Not all neighborhoods are created equal. Some have easy access to tourist attractions and amenities, while others are isolated from the city center. There are also neighborhoods with a higher crime rate, making them unsafe for tourists to stay in. Some communities, particularly ones that are part of an HOA, heavily regulate or have banned short-term rentals.

Thus, it is crucial for you to get the average occupancy rate in each neighborhood or zip code to further narrow down where you will look for a rental home for sale. The classic way to do this is through rental market analysis, in which you look up active Airbnb listings in the area-usually on the Airbnb website itself-and check how many days are already booked in the next six to 12 months.

The main disadvantage of doing this is you are only seeing the upcoming bookings and not the past ones. This means you are not getting a full picture of the occupancy rate in a property. Thankfully, with the advancement of technology in the real estate industry, there are tools and platforms that allow you to get this information in a more efficient manner.

How to Find a Neighborhood’s Occupancy Rate Using Mashvisor

One great example of a platform that helps real estate investors find lucrative markets is Mashvisor. The fastest way to find a neighborhood with high-performing short-term rentals is by using our heatmap feature. First, go to our Property Search page, then type in the city you wish to explore. Select the Heat Map Dataset hovering over the map section to see a dropdown of what you want the heatmap to highlight.

For the purposes of this article, select “Airbnb Occupancy Rate”. The map will then highlight the neighborhoods with the highest occupancy rate in green, the lowest in red, and the ones in between in different shades of orange, yellow, and green. It will also display pins where there are homes for sale. You can then decide which neighborhoods to look into based on their color and the number of property listings. You may also zoom in on the map to see more details.

Once you have identified a neighborhood, click on the link containing the neighborhood’s name on the list of search results on the right side of your screen to open the neighborhood analytics. This page contains crucial Airbnb rental stats to help you learn more about the area.

2022 Airbnb Occupancy Rate at the Property Level

Using the tips above, you may have already found one or two neighborhoods with high Airbnb demand. You can narrow your property search in these communities, but do not just choose the cheapest house on the market without analyzing it further. The property type that is optimal for Airbnb depends on the type of visitors that go to that neighborhood.

Going back to the neighborhood analytics page, you will find a table that charts the average occupancy rate in the area in the last 12 months. You can configure the data shown by selecting a property type (house, apartment, loft, flat) or the number of bedrooms (one to four). You can also compare the data with another neighborhood in the same city.

Doing this will help you determine what property type or the number of bedrooms is in demand among Airbnb guests who visit this location. You could also select the Insights tab to learn what is the optimal property type, number of bedrooms, and rental strategy in the area.

Feel free to use these insights by filtering your search to only display the property type and the number of bedrooms deemed optimal by our AI. You could also analyze a property further by opening its listing page to find the Airbnb stats 2022 for that particular residential unit as well as an Airbnb calculator. Feel free to use this tool to estimate your monthly rental income, expenses, cash on cash return, cash flow, and investment payback.

By default, our AI has already estimated these based on the figures from comparable Airbnb properties and standard costs in the area. But you can edit some of these figures to tailor-fit your projections to your situation.

What Is a Good Airbnb Occupancy Rate in the US?

In general, a good occupancy rate is 50% or higher. But this is not always the case. Airbnb properties in Creve Coeur in Illinois, for example, have an average occupancy rate of 47%, but their cash on cash return is at a high level of 9.11%.

“The higher, the better” does not always work for occupancy rate, either. If your property consistently gets fully booked, it likely means that your average daily rate is too low and you are leaving money on the table.

A good occupancy rate for Airbnb properties in the US, then, is whichever leads to a positive cash flow and solid returns. This may sound abstract, but that is because this metric is not the only part of the equation that determines a short-term rental’s profitability. You also have to consider your average daily rate, running expenses, and mortgage payments. In the end, you want to maximize your profit even if you cannot get a booking every night.

10 Tips to Improve Your Airbnb Occupancy Rate

Just because the occupancy rate isn’t everything does not mean you should ignore it entirely. If you are just starting out, for example, getting bookings should be your biggest priority in order to get reviews and gain credibility. Here are 10 tips to help increase your Airbnb property’s occupancy rate:

#1: Set the Right Price

Your Airbnb’s rate is one of the most important factors that guests consider when finding a short-term rental to book. If your property is new to the platform and has not received any reviews yet, you would want to lower your rates compared to other listings similar to yours. This way, guests will choose your property, and you can get reviews and establish a good reputation.

Once you are booking 90% of the month, you can start raising your rates to generate profit.

#2: Activate Instant Book

Setting your listing to Instant Book does not just make hosting more convenient since you will not have to respond to guests’ requests before accepting their reservations. It also attracts more guests who do not want to talk to someone in order to book an Airbnb. These types of people tend to filter their search to only show Airbnb listings that allow instant booking.

#3: Take Good-Quality Photos and Compose a Professional Write-Up

The photos of your Airbnb property can make or break potential guests’ decision to book, so it is crucial to make sure that the pictures you upload to your online listing are of great quality. Because even if you set a low rate and activated instant booking, guests may still not book your property if they did not like the photos. You should also make an effort to write your listing description as well. Make sure it is informative and grammatically correct.

#4: Change Up Your Space and Amenities

Studies showed that interior design accounts for 35% of guests’ decisions on whether to book a property. The challenge in doing this, however, is that you want it to make guests feel at home while catering to their preferred aesthetics. If you already have good photos on your listing page but are still having trouble getting booked, you might have to revamp your decor and add or change your amenities.

#5: Leave and Encourage Reviews

Reviews are a way for you to establish trust and credibility on the Airbnb platform, whether as a host or a guest. You can take advantage of the timing of when to leave a review to increase the likelihood of getting a positive review from your guest. Airbnb gives both you and your guest 14 days to review each other. If you know that your guest had a great stay, leave them a review as soon as they check out so they would remember to review your listing as well.

#6: Offer an Enjoyable Experience

Whether you want to increase your occupancy rate or want to maintain your business’s good performance, offering an enjoyable experience to your guests helps your bottom line. One way to do this is to build trust with them. Do not leave a long list of house rules or drop by unannounced. You should also adapt your hosting style to suit your guests’ needs and respect their personal boundaries.

#7: Understand Your Target Market

First, you should already know who your target market is when you decided to buy the property and list it on Airbnb. But in case you haven’t done so already or if you sense a shift in the market, then you should take time to understand who is likely to book your property. This usually depends on the location and property type. If your rental is a studio unit located in a commercial district, for example, you are likely to attract business travelers.

Once you know whom you should be promoting your listing to, you can adjust your space and amenities to suit their needs. Revising your write-up to communicate to this specific market would help, too.

#8: Consider Hiring a Property Manager

If you think your occupancy rate is not increasing because you cannot keep up with the inquiries, it is time to have someone assist you with your hosting duties. While this is an additional cost to you, it may help free up your time to focus your attention on something else-perhaps even an additional investment. Just make sure that the person or company you hire will do a better job than you have.

#9: Use a Property Management Software

While an additional person would help offset many of your hosting duties, property management software might cost less. Depending on the tool you avail, it can help you organize your Airbnb properties, bookings, and messages. This way, you can manage your multiple listings on different short-term rental platforms from one centralized dashboard.

#10: Become an Airbnb Superhost

Getting the coveted Superhost badge on Airbnb allows your listing to gain more prominence on the platform, establish trust and credibility, and set yourself apart from competitors. To obtain this status, though, you have to meet the following criteria:

Complete at least 10 bookings.
Maintain a 90% or higher response rate. Activating Instant Book would help.
Preserve a 1% or lower cancellation rate.
Have a 4.8 overall rating and maintain it.

Airbnb evaluates this status four times a year, so it is important to maintain these requirements to keep your badge.

Find Your Next Airbnb Investment Property Using Mashvisor

Airbnb occupancy rate is an important metric for short term rental strategy as it indicates whether demand exists in the area. However, it is not the only Airbnb market data to look into when finding a profitable property. You must also consider your monthly rental income, expenses, cash flow, and cash on cash returns. The most efficient way to analyze a property is by using a real estate investment platform like Mashvisor.

To get access to our real estate investment tools, click here to sign up for a 7-day free trial of Mashvisor today, followed by 15% off for life.

Originally published at https://www.mashvisor.com on January 28, 2022.