Why Lower ADR Can Grow Your Airbnb Business Faster
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Most Airbnb hosts think lowering their ADR (average daily rate) means losing money.
I get it. It feels counterintuitive. You want higher prices because higher prices should equal higher revenue, right?
But here’s the truth I see every day in the data:
Your occupancy rate matters just as much (sometimes even more) than your nightly rate.
A Real Example From The Market
One of our clients in Winter Park saw market revenue drop by 11% year over year. Occupancy fell 9%. RevPAR dropped 10%. On paper, things looked rough.
But their property? It grew 29% in total revenue. Occupancy nearly doubled. RevPAR was 59% stronger than the market.
How? They didn’t just chase a high ADR. They priced smart in the slow season, picked up stays when other listings sat empty, and kept the revenue flowing.
Why This Matters For Your Airbnb Business
When supply rises, demand doesn’t always keep up. That means plenty of hosts with beautiful properties are sitting vacant. If your ADR is “higher” but you’re not booked, that number doesn’t mean much.
Instead, think of your Airbnb business as a system. Your goal isn’t just high ADR, it’s consistent cash flow. Pricing competitively during slow periods means:
→ More bookings that actually stick
→ Steadier income across the year
→ Higher RevPAR compared to competitors
→ Better guest quality than you might expect
The Guest Quality Myth
A lot of hosts worry that lowering ADR attracts the wrong guests. But in slow seasons, that’s rarely the case. When market occupancy dips below 10%, the people booking aren’t there to trash your place. They’re travelers who still need a stay.
Our client didn’t see any guest damage or quality issues... only higher revenue and stronger booking momentum.
The Takeaway
If you want to build a real Airbnb business, focus on total revenue and RevPAR, not just ADR. Strategic pricing during off-seasons is what separates the properties that survive from the ones that scale.
Financial freedom in real estate investing doesn’t come from sitting empty at $400 a night... it comes from smart decisions that keep your investment property working for you year-round.
Looking to maximize your short-term rental revenue?
Let’s talk. Book a consultation with me and the team at AirINN today.
BONUS: Here's a FREE resources that I think you'll love...
If you're like most STR owners, then you're are always looking for ways to make your property stand out & create a 5-star experience.
Well, I've got something that'll help!
I put together this handy "Property Make Ready Checklist" that covers all the essentials (and some fun extras) you need to stock your rental.
And guess what? I'm giving it away for free! All you gotta do is sign up for my email list, and boom – the PDF is yours.
Once you're on the list, I'll also send you some proven tips and tricks to help you crush it in the short-term rental game. We're all in this together, right?
So, what are you waiting for? Sign up now and snag your free checklist! 👇
Written by
Landon Smith
As a "real estate guy" and musician, I love blending the worlds of music and real estate, embodying my "job" as a musician, realtor, investor, builder, and developer.
My passion lies in empowering others to achieve their real estate aspirations, guiding them towards the freedom and enjoyment life has to offer...whatever that looks like for them. As a devoted father and husband, faith, family, and freedom are the core values of my endeavors.
I find a unique harmony between the creative freedom in both my musical and real estate, drawing parallels between composing a song, developing a piece of land, or designing a house. My purpose is more than a transaction; it's about helping others create their vision and empowering them to execute to get the most out of their life.
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