To measure the upcoming potential oversupply risks, the short-term rental accommodation market (STRA), ie. Airbnb etc, needs to be taken into account. Surprisingly, the STRA market is shrinking during FY22 with all capital cities shrinking in supply. This is due to the skyrocketing long term rental yields and explosion in residential demand, with owners opting to flip their short term rentals and locking in with stable long term rentals with increasing yield.
As an example, Sydney saw a 28.59% drop in STRA supply, Perth saw a 20.58% drop, Brisbane saw a 14.39% drop. Respectively, as % of hotel room supply this saw Sydney’s STRA supply as % of Hotel inventory drop from 29.84% to 21.31%, Perth from 7.75% to 6.86%, Brisbane from 11.94% to 10.23%. Darwin is the only city that saw an increase of 22.42% in STRA supply, however, that only accounts for 14.43% of hotel room inventory. The risk in oversupply is in the city of Melbourne, where STRA is 47.34% of hotel inventory, even with a 9.37% drop in supply from 21-22. To conclude, the heavy decline in STRA supply is positive for the hotels sector and mitigates any potential oversupply risks of upcoming hotel developments in ’23-’26.
All Research and Charts by Charles Man. Please ask for permission if re-use. All raw data sourced from STA, STR, corelogic and inidividual states' official tourism statistics website.
Comentarios