European short-term rental rates rose 8.2% in March 2026 as supply growth accelerated

On April 21, 2026, AirDNA reported that average daily rates for European short-term rentals rose 8.2% year-over-year in March 2026 to €123.9, even as occupancy rates declined across the continent due to accelerating supply. The increase in average daily rates helped offset the impact of falling demand, allowing revenue per available rental night to grow during the month.

According to the report, European short-term rental operators faced a complex operating environment in March 2026. While total available listings grew steadily, demand nights fell for the seventh consecutive month, creating an imbalance that compressed occupancy in 13 of Europe's top 20 nations. Despite these challenges, pricing power remained strong among established hosts, and pacing data for the summer months indicated continued interest from travelers, particularly in more affordable price tiers.

What the data shows

In March 2026, the European short-term rental market experienced divergent trends. AirDNA reported that available listings reached 3.48 million, up 4.3% year-over-year, while demand nights declined by 3.5% to 27.9 million. Because supply growth outpaced demand, the average occupancy rate fell by 2.5% year-over-year to 52.2%.

Despite the drop in occupancy, average daily rates rose 8.2% year-over-year to €123.9, driving revenue per available rental night up 5.6% to €64.6. This marked a significant shift for average daily rates, which rebounded after 11 months of flat or negative growth. Nights booked fell 8.3% year-over-year in March 2026, the largest drop since February 2021, when nights booked fell by 22.3%. However, nights booked in March 2026 remained flat compared to March 2024.

For the first quarter of 2026, total occupancy fell to 49.8%, a 3.4% decline from 51.6% in the first quarter of 2025. Both nights booked and demand nights decreased by 3.9% in the first quarter of 2026 compared to the first quarter of 2025. Compared to the first quarter of 2024, demand nights in the first quarter of 2026 were up 2.4%, and nights booked were up 5.1%.

How it was measured

The figures in the report were compiled by AirDNA, which tracked available listings, demand nights, average daily rates, occupancy, and revenue per available rental night across European countries. AirDNA defined new listings as properties entering the market for the first time, and used the Repeat Rent Index to track pricing changes among existing operators, excluding new listings.

The report incorporated the European Economic Policy Uncertainty Index, which measures policy-related uncertainty by counting newspaper articles mentioning uncertainty, the economy, and policy-relevant terms. Domestic tourism demand data was sourced from Eurostat, which indicated that 40% of total tourism demand within the European Union is domestic. Guest origin data for 2025 was sourced from STR.

Supply acceleration and regional shifts

Supply growth in Europe continued to recover in March 2026, rising 4.3% year-over-year. This represented a steady acceleration over nine months from a low of 0.6% year-over-year growth in July 2025. The total of 3.48 million available listings in March 2026 was an increase of 150,000 listings compared to February 2026, and an increase of 140,000 listings compared to March 2025.

The growth in available listings was supported by a rebound in new listings. The three-month moving average of new listings in March 2026 was up 6% compared to 2025, recovering from a 12.7% year-over-year decline in the first quarter of 2025. This moving average was 9,000 units shy of the highs recorded in 2024, which was a 7.5% decline compared to the first quarter of 2024.

New listing expansion was uneven. In Denmark, new listings for March 2026 more than doubled to 4,500, up from 2,000 in March 2025. Germany saw a 27% year-over-year increase in new listings, the United Kingdom recorded a 22% increase, and France saw a 9.5% gain. In contrast, Spain recorded a decrease of 4,500 new listings, with new listings falling from 12,500 in March 2025 to 8,000 in March 2026 due to local regulations.

In the first quarter of 2026, Spain's total available listings fell 11.7% year-over-year, and in March 2026, fell 11.3%, losing more than 40,000 listings. Meanwhile, Germany's available listings grew by 8.2%, Italy's by 7.3%, the United Kingdom's by 4.4%, and France's by 3.6%. Together, four of Europe's top five countries added 100,000 available listings across January, February, and March of 2026.

Occupancy variations and price tier performance

The imbalance between supply and demand led to occupancy declines in 13 of Europe's top 20 nations in March 2026. Switzerland recorded the sharpest occupancy decline, falling 11% year-over-year, driven by a 9% drop in demand nights and a 5% increase in available listings. Austria saw occupancy decline by 8% as demand fell 9% and supply grew 4%. Occupancy also fell in Italy by 4.5%, in Finland by 4.1%, and in Poland by 1.5%.

A few countries managed occupancy gains despite the broader downward trend. Denmark stood out with a 5% year-over-year increase in occupancy, even though demand nights fell by 1% and supply rose by 19%. This occupancy growth was driven by a 5.9% decrease in active listing nights, which suggested that much of the new supply was preparing for the summer season. Ireland saw occupancy rise by 2% despite available listings growing faster than demand.

Spain recorded a 1% increase in occupancy in March 2026. This occurred despite an 11% contraction in supply and a 12% drop in demand, as active listing nights also declined, allowing occupancy to rise even though demand fell faster than available listings. The Czech Republic recorded a 1% occupancy gain, supported by a 13% increase in demand against a 12% increase in supply. Hungary also recorded a 1% occupancy gain, as a 1% contraction in supply offset a 3% decline in demand.

Performance also diverged across different price tiers during the first quarter of 2026. AirDNA reported that budget listings, which are highly sensitive to inflation and economic uncertainty, experienced a 4.2% year-over-year decline in occupancy. In contrast, luxury listings, which cater to higher-earning travelers, saw a modest occupancy decline of 0.8% year-over-year.

Pricing power and the repeat rent index

While occupancy fell in many markets, average daily rates showed resilience. The 8.2% year-over-year jump in March 2026 brought average daily rates to €123.9. This recovery helped push the average daily rate for the first quarter of 2026 to €120.3, up 2.6% from €117.2 in the first quarter of 2025.

The Repeat Rent Index, which tracks pricing changes for existing operators, grew by 10.8% year-over-year in March 2026. This was the highest growth rate for the index since October 2023, when it grew by 11.9% year-over-year. All of Europe's top 20 nations reported year-over-year gains in the Repeat Rent Index during the first quarter of 2026, indicating that experienced operators maintained pricing strength.

AirDNA reported that stricter regulations in Spain, Italy, and Greece, along with April 21, 2026 European Union rules on short-term rental data transparency, appeared to slow the entry of lower-priced properties that had previously dragged average daily rates down. This allowed average daily rates to align more closely with the Repeat Rent Index. In Spain, where supply contracted significantly, existing operators maintained strong pricing, with average daily rates rising 5.7% year-over-year in the first quarter of 2026, and the Repeat Rent Index rising 11.1% year-over-year.

Only two of the top 20 nations saw average daily rates decline during the first quarter of 2026. In Croatia, prices declined due to falling demand combined with the entry of new, lower-priced supply. In Switzerland, a 9% drop in demand nights prompted newer operators to lower their rates.

Economic uncertainty and changing traveler behavior

The performance of the short-term rental market in March 2026 took place against a backdrop of rising economic and geopolitical uncertainty in Europe. Ongoing conflicts in the Middle East, the closure of the Strait of Hormuz, and high oil prices contributed to increased policy uncertainty. The European Economic Policy Uncertainty Index rose in all major European countries except France. In Germany, uncertainty approached its 2025 peaks due to tariffs announced by the United States.

These factors led the European Central Bank to revise its inflation forecasts upward. The bank expected inflation to reach 3.1% in the second quarter of 2026 before leveling out at 2.8% in the third quarter, which was above the medium-term target of 2%.

As energy and fuel costs rose, long-distance travel became more expensive. However, AirDNA noted that a large share of European tourism demand is domestic. Eurostat data showed that 40% of total demand within the European Union is domestic. In some countries, the domestic share is much higher. According to 2025 guest origin data, the domestic demand share was 55% in Germany, 66% in the United Kingdom, and 67% in France.

This domestic demand appeared to influence traveler behavior. Travelers increasingly opted for shorter, more frequent trips rather than single, long holidays. The average length of stay declined across all price tiers. For luxury properties, the average length of stay fell from approximately 5.6 days in 2022 to roughly 4.2 days in 2026, with most of the decline beginning in January 2024.

Despite these shifts, summer pacing data for June through September 2026 remained positive, with demand up 8.7% compared to 2025. On a monthly basis, demand was up 13.3% for July, 9.5% for August, 8.9% for September, and 2.5% for June. Lead times also increased across all price tiers, indicating that travelers were booking their summer trips earlier. Budget and economy listings led year-over-year occupancy gains for the summer months, suggesting that demand was shifting toward more affordable properties.

What to take from it

For short-term rental operators and investors, the performance metrics from March 2026 offer several practical lessons on how to navigate a mature market experiencing supply growth and shifting traveler behavior:

• Compare your property's performance against local supply dynamics rather than national or continental averages, as regulatory environments in countries like Spain can create highly localized pricing and occupancy trends.
• Monitor the Repeat Rent Index alongside your own historical pricing to determine whether your rate increases are aligned with established local operators or if they are being undercut by new, lower-priced listings entering your specific market.
• Adjust your operational budget and pricing strategies to account for shorter average lengths of stay, which increase turnover costs and cleaning cycles even when occupancy rates remain stable.
• Evaluate pacing data with caution by looking at both booking lead times and price tier demand shifts, as early bookings in budget segments may indicate a more price-sensitive guest pool rather than a general increase in market demand.