Puerto Rico tourism sees profitable times with short-term rentals

Friday, November 8, 2019

The latest industry report by the Puerto Rico DMO brings promising news to the tourism industry. Demand for lodging and the total revenue made by the lodging sector has gone up. Interestingly, short-term rentals have increased their share of the lodging industry from 15 percent in 2017 to 26 percent this year.

Hotel sector revenues have remained almost unchanged during the same time period. The report says how the market dynamics of the conventional tourism industry have been disrupted with the advent of short-term rental platforms.

Today, with the spreading of short-term rentals, the way the tourism industry responds to an increment in demand has substantially changed. Now, for catching up with new demand, supply is being increased with the help of new short-term rental units. In any case, it is easier to convert existing properties into short-term rental units than constructing new hotels.

The new supply brings prices back to equilibrium. This new market trend is great news for the tourism industry, because it makes staying in Puerto Rico much reasonable and also attractive for a larger pool of tourists. It also diversifies lodging alternatives and experiences. Understanding these trends will be important for both hotels and short-term rentals owners. Hotels will need to emphasize on what makes them different from short-term rentals.

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