Short-Term Rental KPIs Explained: Occupancy, ADR, and RevPAR

Occupancy rate, ADR, RevPAR — these terms get thrown around constantly in short-term rental circles, but a lot of hosts use them loosely without a clear sense of what each one actually measures, or which one matters most for a given decision.

Occupancy rate

What it is: the percentage of available nights that were actually booked, over a given period.

Formula: Booked Nights ÷ Available Nights × 100

What it tells you: how much of your calendar is filled. High occupancy alone doesn't mean you're maximizing revenue — you could have high occupancy at underpriced rates.

ADR (Average Daily Rate)

What it is: the average rate you're actually collecting per booked night.

Formula: Total Room Revenue ÷ Booked Nights

What it tells you: your pricing power, independent of how full your calendar is. High ADR with low occupancy can mean you're priced too high for demand; low ADR with high occupancy can mean you're leaving money on the table.

RevPAR (Revenue Per Available Night)

What it is: the single number that combines occupancy and rate into one comparable figure.

Formula: Total Room Revenue ÷ Total Available Nights (equivalently, Occupancy Rate × ADR)

What it tells you: RevPAR is why it's the metric most worth watching — a property with 90% occupancy at a low rate and one with 60% occupancy at a high rate can produce the exact same RevPAR, and RevPAR makes that visible where occupancy or ADR alone would hide it.

Other metrics worth tracking

• Booking lead time — how far in advance guests typically book; shrinking lead times can signal pricing or demand issues
• Average length of stay — longer stays generally mean less turnover cost per night of revenue
• Review score trend — a slow decline is an early warning sign worth investigating before it shows up in bookings
• Response rate and time — directly affects visibility on platforms like Airbnb

How often to review these

Weekly is reasonable for occupancy and ADR during active pricing decisions; monthly is enough for RevPAR trends and review scores unless something looks off. Reviewing daily tends to produce reactive pricing decisions based on noise rather than real signal.

Red flags worth acting on

• RevPAR declining month-over-month while competitor rates in your area are stable or rising
• Occupancy dropping sharply with no seasonal explanation
• Booking lead time shrinking significantly, suggesting demand softening