Predict the Success of Your Airbnb Business with Key Economic Indicators

Jan 19, 2023

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Today we're back with Mariah Kamei and Jamie Lane, and they’re diving into the latest economic report and what it means for the future. As we all know, inflation has been a hot topic in the past year, and the latest report shows that it went down by 0.1% MoM. This is the first time we've seen a negative read in a long time, but it's still up 6.5% YoY. The Federal Reserve is closely watching inflation, and this report is a positive sign. If we continue to see this trend, it means inflation will be right where the Fed wants it to be, which could lead to a pause in the rising of interest rates.

The short-term rental market is thriving, with STRs earning over $62 billion in the US, an increase of 25% YoY. Globally, the industry exceeded all expectations with $141 billion earned. We also saw strong demand for nights booked, up 24% YoY, and a 20% increase in the number of nights stayed in December. Additionally, December saw the most new listings added, with a 23% increase. Occupancy only declined by 1.2%. However, it's important to note that ADRs (average daily rates) were only up 3.5%, and we expect that trend to continue to decline.

Lastly, it's important to note the difference between recovered and unrecovered areas. Recovered areas are those where demand has gotten back to 2019 levels, while unrecovered areas are those where demand has not yet returned to pre-pandemic levels.

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Jamie’s Favorite Indicators of U.S. Economic Health:

Bureau of Labor Statistics: https://www.bls.gov/bls/newsrels.htm#major

Housing Reports: