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Hurricane Maria’s Impact On Puerto Rico’s Vacation Rental Market
In September 2017, Hurricane Maria completely devastated the island of Puerto Rico. The impact of the hurricane was life-changing for thousands and thousands of residents on the island, devastating homes, businesses, and the economy.
Using our unique AllTheRooms data, we are able to drill down into the hard facts about the impact of natural disasters on tourism and the vacation rental landscape.
While Puerto Rico suffered a lot of damage, the tourism and vacation rental industry has recovered exceptionally well from Hurricane Maria, considering the catastrophic damage of the hurricane, plus the fact that the lesser impactful Hurricane Irma also hit the island a month earlier. Here’s how Puerto Rico’s tourism industry has bounced back.
Initial Hurricane Impact
After any natural disaster, tourism takes a huge hit. Puerto Rico attracted over 3.8 million tourists in 2016, the year before the hurricane, with the number substantially dropping in the aftermath. The economy was hugely impacted, and reviving the tourism industry was seen as an important way of bringing money back to the island.
The financial impact of the hurricane cannot be understated. In total, Hurricanes Maria and Irma cost the Puerto Rican vacation rental market over $52.5 million in potential revenues, with the largest losses coming from the popular East and West regions, which are best known as idyllic beach destinations.
Puerto Rico’s Vacation Rental Potential
From AllTheRooms’ predictive analytics we can look back at Puerto Rico’s trajectory, pre-Hurricane Maria. The island’s pre-storm revenues were compared to those of similar destinations (Jamaica, Cuba, Bahamas, Dominican Republic, Bermuda, The Florida Keys, and Aruba). Of all the islands mentioned, Puerto Rico’s gross revenue in the vacation rental industry was the highest, only being surpassed marginally by Cuba in October and November 2017 (the immediate aftermath of the hurricane) when Puerto Rico’s vacation rental gross revenue dipped below $3 million USD.
Vacation Rental Market Growth
From 2016 onwards, Puerto Rico’s vacation rental market has been growing steadily. Even with the impact of the hurricane in September 2017, and the initial dip in revenue and visitors, from July 2017 to July 2019 the number of active listings in Puerto Rico increased from 4,678 to 7,955 – an increase of 70%.
Gross Revenue growth has outpaced the increase in active listings, increasing from $7,137,972 earned throughout the island in July 2017 to $14,346,822 earned this past July. YoY Growth has also stabilized.
Back to Business
As of 2019, most of the vacation rental market metrics have recovered and reached all-time heights – which is an impressive achievement considering the destruction the hurricane wreaked on the island. Looking at the short-term rental industry, we can see just how the market has bounced back, reaching an all-time high in July 2019, at over $14 million USD in gross revenue, and grossing over $116 million USD for the last twelve months ending August 2019.
Vacation Rentals Platforms Helping the Recovery Process
Vacation rentals platforms such as Airbnb have helped to boost the tourism industry in Puerto Rico. Airbnb invested time and effort into aid for the island’s recovery, as well as encouraged responsible tourism.
In conjunction with their efforts, Airbnb launched the Office of Healthy Tourism, which has targeted opportunities in Puerto Rico. The company also assisted with the foundation of the first Home Sharing Club in San Juan, which included a volunteer service to help paint homes and install solar-powered street lights in underserved areas of San Juan.
The company’s help didn’t stop there. Airbnb launched an email campaign and built a landing page on their website showcasing Puerto Rico as a vacation destination. The backing of such a large platform as Airbnb certainly provided assurance to travelers contemplating visiting the island post-Maria.
Reviving Tourism on the Island
In July 2018, Puerto Rico’s government created a new tourism organization called Discover Puerto Rico, which was part of a plan to use tourism to grow revenue and revitalize the island post-hurricane.
The organization, which is the island’s first official Destination Marketing Organization, or DMO, has been on a mission to rapidly grow its tourism economy and spearhead campaigns showcasing Puerto Rico as a leading Caribbean destination.
The organization worked hard on a brand-repositioning process with its #CoverTheProgress campaign, documenting just how quickly the island was rebuilt.
Occupancy Rate At An All Time High
As of March 2019, occupancy rate across Puerto Rico’s vacation rentals reached an all-time high, at 47% occupied, which coincided with an average daily rate (ADR) of $129.
It’s been a remarkably fast recovery, as, after the hurricane, the average vacation rental occupancy in Puerto Rico fell to just 11% in the months of October and November 2017 – significantly lower than the typical off-season dip to 25%.
Increased Air Access
The higher vacation rental demand has been solidified by growing air access, with San Juan International Airport (SJU) seeing a 23.8% year-over-year increase in air traffic in the first quarter of 2019 compared to the start of 2018.
Puerto Rico has always been a popular Caribbean island destination, and while Hurricane Maria caused widespread devastation, the island’s tourism industry was able to stabilize remarkably quickly.
Puerto Rico is now home to almost double the amount of vacation rentals, and travelers continue to flock to the destination. Thanks to smart post-hurricane tourism marketing, the help of travel platforms such as Airbnb, and the island’s general resilience, it’s on a trajectory to continue performing well in the vacation rental sphere.