Occupancy rate
The share of your available nights that sold — accurate only if 'available' genuinely means bookable.
Occupancy = nights booked ÷ nights available
Occupancy is the simplest metric in the business and the one most often computed wrong, because everything depends on what you counted as available.
Three categories quietly distort it. Nights you blocked for your own use are not lost business. Nights blocked by a minimum-stay rule were never purchasable. Nights before your listing went live did not exist. Each one belongs out of the denominator, and each one is routinely left in.
Compare occupancy only against the same window, measured the same way. A 68% figure for the next 30 days and a 68% figure for the trailing 30 days describe completely different things: one is a forecast that can still change, the other is settled history. Quoting them side by side, as most dashboards do, invites exactly the wrong comparison.
Occupancy is also a lagging measure of a pricing decision. A rate change made today shows up in occupancy only as bookings arrive over the following weeks, which in a market with a long booking window can be a month or more. Judging a rate change by next week's occupancy is judging it before the evidence exists — which is why pace, not occupancy, is the number to watch while a decision is still reversible.
Where it goes wrong
Chasing high occupancy as a goal in itself. 100% occupancy is nearly always evidence of underpricing — if every night sold, at least some of them would have sold for more.
Related terms
- RevPAR (Revenue Per Available Rental) — Revenue divided by every night the property was available — the single number that cannot be improved by simply pricing yourself out of the market.
- Booking pace — How fast a future date is filling compared with how fast it normally fills by the same point — the earliest honest signal that a rate is wrong.
- Orphan night — A gap between two bookings that is shorter than your minimum stay, so nobody can book it at any price.
- Minimum stay (min-night requirement) — The fewest nights a guest may book — a lever that protects your turnover costs and destroys your occupancy in equal measure if left static.