Metrics
What Is a Good Occupancy Rate for a Short-Term Rental?
3 min read
"What is a good occupancy rate?" is one of the first questions new hosts ask, and the honest answer surprises people: it is not the highest number you can hit. A good occupancy rate is the one that produces the most profit, and that is often lower than you would guess.
What occupancy actually measures
Occupancy is the share of your available nights that get booked. Twenty booked nights in a thirty-night month is about 67% occupancy. Simple enough. The trap is treating it as a score to maximise, as if 100% were the goal.
It is not, for one reason: you control occupancy with price. Drop your rate low enough and you can fill almost every night. That does not mean you are winning. It means you might be busy and broke.
What is realistic
Occupancy varies enormously by market, property type, and season, so any single benchmark is rough. As a broad guide, many short-term rentals land somewhere in the 50% to 70% range across a full year, with strong listings in high-demand markets running higher and seasonal or rural places running lower in the off months.
If you are far below that, price or listing quality may be the issue. If you are near 100% year-round, there is a good chance you are underpriced and leaving money on the table.
Why chasing 100% costs money
Every booked night carries cost: cleaning, consumables, wear, and platform commission. Push occupancy up by cutting your rate, and you add all those costs while shrinking the margin on each stay. Past a certain point, the next booking earns less than it costs to service.
This is why rate and occupancy only mean something together. The metric that combines them is revenue per available night, your rate multiplied by your occupancy. A place at $180 a night at 55% occupancy can out-earn the same place at $120 at 80%, with fewer turnovers, less wear, and less commission paid. Fuller is not automatically better.
The number to optimise instead
Stop optimising occupancy on its own and optimise profit per available night: what you actually keep, per night, after all costs. That single figure tells you whether a price change helped or hurt, in a way that raw occupancy never can.
If you are sizing up a property or a price change, the deal calculator lets you test rate and occupancy combinations against your real costs and see which one profits, rather than guessing at a "good" percentage.
Where commission fits in
Occupancy also decides how much commission you pay, because commission scales with bookings. The busier you are, the more you hand to the platforms across a year. To see that yearly figure for your own rate and occupancy, use the OTA commission calculator.
That link runs both ways. If a slice of your bookings came direct instead of through a platform, you would keep the commission on every one of those nights, which raises profit per available night without changing your occupancy at all. It is the same calendar, more margin. That is the case for building repeat direct bookings, covered in how to get direct bookings.
The short version
A good occupancy rate is not 90% or 100%. It is the level, usually somewhere in the 50% to 70% band for a full year, where your profit per available night is highest. Read it alongside your rate, never alone. Then make each booked night worth more by keeping the commission on the ones you can win directly.