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Research Update: Short-Term Rental Recap & Market Predictions

Thursday, February 13, 2025 Research

Key Insights into the Short-Term Rental Market and Future Forecasts

During the 3rd Annual Rebook Conference held on Saturday, February 1st, 2025, Discover Puerto Rico shared the latest industry metrics from the Short-Term Rental Industry. According to industry partner AirDNA, 5.7 million nights were available to book in 2024, an increase of 10% from the same time last year. The Metro area accounts for 38% of the total nights available, while the East region accounts for 19%, and the West region, which includes Rincón, Cabo Rojo, and La Parguera, accounts for 26% of the total listing nights.

The regions with the highest year-over-year growth in listing nights were the North region with 26% and the Central region of the Island with 24% growth. The Metro area, which includes San Juan and the nearby suburbs, only grew by 2%, while listing nights in the San Juan municipality grew by 18%.

Over 3 million rental listing nights were booked in 2024. Nights booked in the Metro region grew 20% year-over-year and accounted for 45% of the total booked listing nights in 2024, while the West totaled 21%.

Similarly to the supply trends, booked listing nights in the Central region of the Island grew by 24% and 27% in the North.

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PR regions graphics

AirDNA’s 2025 U.S. Short-Term Rental Outlook Report provides an optimistic forecast for the short-term rental (STR) market. Supported by rising real incomes and steady economic conditions, demand is expected to grow by 4.9% in 2025, driving RevPAR gains of 2.9% and outpacing supply growth, projected to slow further to 4.7%.

After a strong end in 2024, AirDNA’s Puerto Rico future pace report, as of January 27, confirms more listing nights booked for the next six months compared to the same time last year.

While January final data will be available soon, the remainder of the first quarter shows strong monthly growth of 12% and 15% Island-wide. The second quarter currently has 32% more listing nights booked than the same time last year.

The San Juan rental market six-month forward outlook has 24% more listing nights booked at this time than last year. The Metro area market, which includes San Juan and surrounding suburbs, accounted for 41% of the revenue share of the total rental market last year, an increase of 27% and the largest share among all of the regions.

Research update graphics

According to year-end data from STR, the hotel group segment accounted for 12.7% of hotel occupancy, a decrease of -6.7%. Group average rates in 2024 increased by 5%, reaching $272, which was 14% lower than average transient rates around the Island.

Discover Puerto Rico is responsible for the marketing and sales efforts of the meetings, incentives, and events market. In 2024, 416 bookings totaling 208,000 room nights were confirmed, resulting in a flat growth in the number of bookings and room nights booked.

As of the beginning of this year, over 147,000 room nights have been sold for 2025 and 77,000 for 2026, including important programs such as the 2025 AJ Convention, Caribbean Volleyball Championship, and Parents as Teachers Annual Conference, among others.

As of January 1st, 2025, the Discover Puerto Rico sales pipeline boasts 814 open leads, 623,000 room nights, and a potential economic impact of $549 million.

GRAPHICS

According to STR, 2024 U.S. group demand increased by 2.9%, ahead of transient demand of 1%, with significant peaks in demand for group business in March, January, and February.

With an expected GDP growth of 2.6% this year, STR does provide some 2025 travel assumptions for the following travel segments:

Leisure Market

Price sensitivity into 2025, slow improvement in 2026
Bifurcation or division of consumers continues in 2025, especially by income
Experiential travel increases — favors Next Top 25 markets and out-of-the-way locations
Events, events, and more events
Increased competition from cruising, port markets may benefit
Proposed tariff and immigration policies have potential to increase inflation

Business Market

“Return to Office” will help increase business travel
First half of 2025 will be stronger due to storm/fire recovery — a primary driver of Q4 2024
Booking windows gradually lengthen but remain short, increasing volatility in group rate growth
New administration is seen as more “business friendly” and is expected to help lift corporate travel
Flip side is proposed tariffs at percentages that could dampen corporate travel as costs increase

2024 us GROUP HOTEL SEGMENT GRAPHIC