Amidst the desert landscapes and the sea, Cabo stands out as one of the most coveted tourist destinations in Mexico, attracting both locals and foreigners. However, like any thriving destination, the short-term rental industry in Cabo has had its ups and downs. If you are curious about the market landscape, what we observed in the last quarter of 2023, and the Airbnb insights in Cabo for 2024, please refer to our complete report below.
During the last quarter of 2023, a significant year-over-year decrease of 22% was observed in the occupancy of the short-term rental market in Cabo, compared to the same period in 2022. This contraction directly impacted monthly revenues, resulting in a 16% decline. This phenomenon is primarily attributed to the introduction of new units into the market during that period, leading to an increase in supply and consequently a decrease in the demand for short-term rentals.
Additionally, a reduction in the flow of international tourists to Cabo contributed to this downward trend. The decline in foreign visitors had a negative impact on the demand for temporary accommodations, as these tourists represent a significant portion of the clientele in this market.
Supply: During the last quarter of 2023, a shift in active listings was evident within the short-term rental market in Cabo. Despite the challenging conditions facing the sector, the number of active units remained stable from month to month. This phenomenon is particularly noteworthy as it indicates a certain stability in the quantity of properties available for short-term rental, despite fluctuations in demand. Additionally, it is encouraging to highlight that there has been a positive year-over-year growth, with a 13% increase. This indicator reveals a long-term trend suggesting a constant expansion in the supply of vacation accommodations.
Demand: Data provided by the Department of Turism reveals a significant 12% decrease in the number of tourists in Cabo. This information is crucial considering that travelers in Cabo represent 74% of the total tourist population. The decrease in visitor flow is a key indicator of the challenges facing the sector, as tourism plays a fundamental role in the demand for short-term rental services.
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