Naya Homes
Homeowners     17 Apr 2024

Short-term Rental Market Landscape | Puerto Vallarta | Q1 2024

Puerto Vallarta, known for its paradisiacal beaches and Mexican charm, is currently undergoing a period of change and adaptation in the short-term rental industry. What exactly is happening? Let’s dive into the data and explore the factors shaping the market, as well as some predictions for the upcoming quarter.

Vacation Rental at Paramount Bay by Naya Homes in Puerto Vallarta

The Numbers: What’s Happening in Puerto Vallarta?

According to a recent analysis, while the number of tourists in Puerto Vallarta has experienced a year-over-year increase of 5%, the total nights booked have decreased by 1%, mainly due to shorter stays.

This phenomenon has led to a notable discrepancy, as the tourist supply continues to grow at a rate of 9% year-over-year, while booked nights remain steady, resulting in a 7% year-over-year decrease in occupancy.

Additionally, international tourists seem to be leaning towards more budget-friendly destinations than Puerto Vallarta, such as Nayarit or other less popular beach destinations, due to the current strength of the Mexican peso.

Market Factors: Supply and Demand

In Puerto Vallarta’s bustling tourism industry, we notice a fascinating interplay between supply and demand. Although the growth of new vacation rental units is slowing down, the number of nights available for booking has surged by 9% annually. Yet, this increase in availability has surpassed the demand, leading to a direct decline in occupancy rates.

On the other hand, according to data from the Ministry of Tourism, the number of tourists has seen an encouraging growth of 5% compared to the previous year, despite challenges stemming from the strength of the Mexican peso.

Sources: Internal data, Transparent, Wheelhouse, AirDNA

Forecast for Q2 2024

  • Looking towards the second quarter of the year, a slowdown in international tourism is expected due to the strength of the Mexican peso. Nonetheless, it is expected that the growth of domestic tourism will continue, with a 5% annual rise in the demand for short-term rentals among Mexicans.
  • International travelers will continue to seek more budget-friendly alternatives, potentially leading them to opt for more affordable rental units or destinations.
  • Travelers are expected to stay for shorter periods of time and book with less anticipation, requiring greater flexibility from accommodation providers.

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