What it is
Revenue Per Available Room (RevPAR) measures how much revenue a listing earns on average for every night it could have been rented during a reporting period. For short-term rentals the “room” is a listing-night (one listing available for one night).
How it works
Two common formulas used in STRs:
- RevPAR = ADR × Occupancy Rate (ADR = average daily rate collected from nights booked)
- RevPAR = Total room/night revenue ÷ Total available nights Example: ADR $150 with 60% occupancy → RevPAR = $150 × 0.6 = $90. For a 30-day month with one listing that’s equivalent to $2,700 total room revenue ÷ 30 available nights = $90.
Why it matters to hosts
RevPAR combines price and occupancy into a single performance number so you can compare different properties, seasons, or channels. It helps answer whether higher rates or higher fill are driving revenue and is useful when evaluating pricing strategies, channel performance, or portfolio-level revenue productivity.
Common misconceptions and gotchas
- RevPAR is not profit: it ignores operating costs (cleaning, utilities, management fees) and one-time guest fees. Use it with profit metrics to judge financial health.
- Cleaning and one-time fees: many OTAs display cleaning fees separately; if you include cleaning fees in revenue calculations without consistency across properties or channels, RevPAR comparisons get skewed. Best practice is to define whether RevPAR includes only night revenue or includes all guest-paid fees and apply the rule consistently.
- ADR vs RevPAR: ADR measures price for booked nights only; RevPAR factors in unsold nights via occupancy. A high ADR with low occupancy can produce a lower RevPAR than a modest ADR with consistently high occupancy.
- Data source and period definitions: for a single listing, “available nights” means calendar nights the listing was offered. For portfolios, sum available nights across listings. Use PMS or channel-manager exports to avoid manual errors.
How hosts use it
Track RevPAR alongside ADR and occupancy to test dynamic-pricing changes, measure OTA performance, and prioritize marketing. It’s a quick indicator of revenue efficiency but should be paired with cost and profit metrics for decision-making.