Naya Homes
Homeowners     17 Apr 2024

Short-Term Rental Market Landscape | Mexico City | Q1 2024

Mexico City, with its rich history, cultural offerings, and growing economy, remains a magnet for travelers from around the globe. Like any market, its short-term rental landscape is subject to fluctuations and changes. Keep reading for an analysis of the first quarter of the current year, exploring the trends shaping the market and the outlook for the next quarter.

Condo at Icon Cibeles in Mexico City, by Naya Homes

The Numbers: What’s Happening in Cabo?

Mexico City continues to exhibit an upward trend in the number of reserved nights, with an annual growth of 7%. However, the number of available listings continues to increase each year, by 19%.

This imbalance of supply surpassing demand has led to a decrease in year-on-year occupancy (-8%) and prices (-11%), adversely affecting unit incomes in the market, decreasing by -22% year-over-year.

Market Factors: Supply and Demand

Supply: Despite an ongoing increase in available nights (+11%), the growth rate in the first quarter has decreased compared to the previous year.

Demand: Although there is a year-on-year increase in the number of reserved nights, it has not been able to keep up with the growth of new listings, resulting in a continued decline in occupancy rates. This trend has contributed to a decrease in rates (-11%).

Sources: Internal data, Transparent, Wheelhouse, AirDNA

Forecast for Q2 2024

  • Mexico City continues to attract the highest annual number of travelers in Mexico, a trend expected to persist in 2024. This is especially true for business travelers, where numbers are anticipated to return to pre-COVID levels.

  • The decline in occupancy rates is slowing down due to a trend toward transitioning to the long-term rental model or selling by property owners. This change is expected to help stabilize both occupancy and daily rates in the market.

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