With the 2024 Paris Olympics scheduled from July 26 to August 11 and the Paralympic Games from August 28 to September 8 approaching, France finds itself in a complex situation. While the excitement surrounding the event is palpable, the French travel industry faces significant challenges, exacerbated by unfavorable weather in the spring and early summer, recent political turmoil, and more.
Despite these hurdles, recent data from Airbnb and a 2023 report by Deloitte reveal surprising numbers that short-term rental owners and property managers should note.
- The number of nights booked for accommodation in the Paris area during the 2024 Paris Olympics has increased by 400% compared to last year, as of the end of the first quarter of 2024.
- The number of Airbnb listings in Paris increased by nearly 40% compared to a year ago, based on a comparison of data from January to March 2023 and January to March 2024.
- According to Deloitte, more than half a million visitors are expected to stay in Airbnb accommodations during the Olympic and Paralympic Games, roughly doubling the number of travelers who stayed in the Paris region from 29 and August 14, 2022, and between August 31 and September 12, 2022.
- Deloitte estimates Airbnb stays during the Olympic and Paralympic Games are expected to generate more than €1 billion for the French economy, including revenue from Airbnb hosts, and guest spending at local restaurants and businesses.
Check out our latest video where Thibault Masson breaks down the 2024 French Olympics scenario and shares insightful analysis of the current situation in France.
A Tough Season for French Tourism
The lead-up to the Olympics has been challenging for France’s hospitality sector. Unexpectedly, May and June experienced a significant downturn in tourism and revenue, with projections for July and August also looking bleak.
Typically, France doesn’t need the Olympics to attract visitors, as evidenced by the over 100 million tourists it welcomed in 2023 alone. However, the upcoming Olympic Games have introduced unique challenges that are deterring regular tourists. Instead of boosting tourism, the opposite is happening: disruptions caused by extensive road works, fears of congestion, potential terrorism threats, rising accommodation prices, and ongoing political drama have combined to keep visitors away this spring, and these issues are expected to persist through the Olympic period.
The Olympic Games have created conditions that are counterproductive for the usual tourist influx. As a result, the hospitality sector is facing a tough season, hoping that the long-term benefits of hosting the Olympics will eventually outweigh the short-term setbacks.
Factors Contributing to Declining Occupancy Rates
Oversupply of Rental Listings
Airbnb, a major sponsor of the Olympics, has reported a 40% increase in active listings in the Île-de-France region. This surge, particularly in areas like Saint-Denis, has led to an oversupply, driving down occupancy rates for existing rentals.
Event Displacement
Regular tourist activities are being overshadowed by Olympic events, causing a significant displacement. Many popular sites will be inaccessible, deterring those seeking a more relaxed visit.
Traffic and Transportation Issues
The central areas of Paris, slated to host many competitions, will experience severe traffic congestion and road closures. This, coupled with the small geographic size of central Paris, will make movement difficult, further discouraging tourists.
Political Uncertainty
The recent snap elections have added a layer of political uncertainty, negatively impacting travel sentiment towards Paris.
Poor Weather Conditions
The adverse weather this summer has particularly affected outdoor activities, compounding the challenges for cruise operators and other attractions reliant on good weather.
Business Travel Impact:
Many companies are avoiding Paris for business events, preferring digital meetings to avoid the logistical challenges posed by the Games. This has further impacted hotel occupancy and revenue.
Despite the excitement surrounding the Olympics, these factors have created a challenging environment for Paris’s hospitality industry. The undeniable anticipation is overshadowed by a combination of unfavorable conditions, presenting a complex scenario for hospitality professionals in the city.
The Paradox of Airbnb’s Positive Trends
Despite the overall gloom, Airbnb’s data presents a more nuanced picture. Nights booked in the Paris region during the Olympics are up by 400% compared to the same period last year. This increase suggests a robust demand for short-term rentals specifically for the Olympics. Furthermore, smaller towns and neighborhoods outside central Paris, like Saint-Denis, Châteauroux, and Lille, have seen a significant rise in interest. This dispersal of tourists helps manage the influx more evenly across the region.
Among the guests from over 160 countries and regions who have already booked accommodation for the 2024 Paris Olympics, travelers from the United States are leading in terms of reservation days until April 1, 2024.
This graph, recently shared by Airbnb, highlights the top countries for nights booked during the Olympics. It provides a clear visual representation of the leading nations in terms of accommodation bookings, showcasing international interest and travel trends for the 2024 Olympic Games.
Based on Airbnb data of nights booked from January 1, 2023, to March 31, 2024, the graph clearly shows that the United States leads in the number of nights booked for the Olympics. American travelers have made the most reservations, accounting for over 20% of all bookings in the Paris region during the Olympic period.
What does this translate to?
High Demand from U.S. Travelers: The significant number of reservations by U.S. guests indicates a strong interest and participation in the Paris Olympics. This could be due to several factors, including the large number of American athletes participating, the strength of the American dollar, and the high purchasing power of Americans.
Economic Impact: The influx of U.S. travelers is likely to have a substantial economic impact on the local hospitality industry. With over 20% of accommodation reservations attributed to American guests, businesses such as hotels, short-term rentals, restaurants, and local attractions can expect increased revenue.
Overall Projected Economic Impact of Airbnb During the Olympics 2024
Airbnb has reported some positive trends that seem to counter the general pessimism surrounding France. Let’s break down the key points:
- Increase in Bookings:
Airbnb revealed that the number of nights booked in the Paris region during the Olympic Games is over five times higher than the same period last year. This indicates a strong demand for short-term rentals specifically for the event.
- Interest in Peripheral Areas:
There has been a noticeable rise in interest for accommodations in smaller towns and neighborhoods outside of central Paris, such as Saint-Denis, Châteauroux, and Lille. This trend helps to distribute the influx of visitors more evenly across the region, easing the pressure on central Paris.
- Economic Impact:
A study estimates that staying on Airbnb during the Olympics will generate €2,000 for a typical host in the Paris region. The total economic impact is projected to be nearly 1 billion euros, supporting approximately 7,300 full-time equivalent jobs in France.
Traditional hotels and airlines might face significant challenges, however, Short-term rental hosts can benefit greatly, particularly those in strategically located areas or offering unique accommodations.
What Makes the 2024 Olympics Special?
The 2024 Olympics are shaping up to be a truly unique event, and there are several reasons why this year’s games stand out.
Airbnb Sponsorship and Increased Listings
Airbnb’s significant role as a sponsor is noteworthy. As a major partner for the 2024 Olympics, Airbnb has been promoting the event heavily and encouraging hosts to list their properties to meet the anticipated demand. This initiative has led to a remarkable 40% increase in active listings in the Île-de-France region, which includes Paris.
According to PriceLabs data, areas like Saint-Denis, where the main stadium is located, have seen an even more dramatic increase. The supply of listings in Saint-Denis has multiplied by five over the past two years. This surge indicates the strategic positioning of listings to accommodate the high demand expected in these key locations.
Event Spread Across the Country
Another aspect that makes the 2024 Olympics special is the decision to host events across various cities in France, rather than concentrating them all in Paris. This strategy helps distribute tourists more evenly throughout the country, reducing congestion in the capital and allowing other regions to enjoy the economic benefits of hosting Olympic events.
For instance:
- Field Hockey in Colombes: Dutch and Australian guests, who are strong contenders in field hockey, have booked the most nights in Colombes, where the sport will be played. This influx is expected to boost the local economy.
- Football in Bordeaux: Spaniards and Brazilians, who are passionate about football, have made Bordeaux one of their top destinations as their national teams play two matches there. This will bring significant economic activity to Bordeaux.
- Table Tennis in Vanves: Chinese guests, who excel in table tennis, are gravitating towards Vanves, near the venue for this sport. The local economy in Vanves will benefit from this specific influx of visitors.
Football matches for the 2024 Olympics will be spread across several major cities in France. These matches will take place in Bordeaux, Nantes, Lyon, Saint-Etienne, Nice, and Marseille, allowing various regions to participate in the excitement of the games. The final phases of handball and the qualifying matches for basketball will be hosted in Lille. Additionally, sailing competitions will be held in Marseille, located on the Mediterranean Sea.
This distribution of events helps to ensure that the Olympic spirit is felt throughout the country.
By spreading the events across different cities, the organizers aim to manage tourist flow better, avoid overcrowding in Paris, and ensure that the economic benefits of the Olympics are felt more broadly across the country. This approach not only enhances the visitor experience but also supports local businesses and communities, showcasing the diverse attractions that France has to offer.
In 2023, Thibault Masson, the founder of Rental Scale-Up, published an insightful article “AIRBNB PARIS 2024 OLYMPICS: SEARCHES JUMP, BUT NEW REGULATIONS MAY DAMPEN THE PARTY” This piece delves into the excitement surrounding the surge in Airbnb searches for the 2024 Paris Olympics while also discussing the potential impact of new regulations on the short-term rental market.
Read the full article on Rental Scale-Up.
The outlook for France’s hospitality industry as we approach the 2024 Paris Olympics is quite mixed. Traditional hotels and airlines are facing significant challenges due to a variety of disruptions and a decline in tourist numbers.
Conversely, Airbnb hosts seem to be weathering the storm better. However, Airbnb has managed to carve out a resilient niche. The adaptability and flexibility of short-term rentals have allowed Airbnb hosts to better navigate these turbulent times.
While the influx of visitors during the Olympics is a positive sign, it also brings its own set of challenges. The increased activity will likely lead to extremely busy transportation networks, including trains and planes, which could discourage some travel across France during the Games.
Additionally, in areas not hosting any Olympic events, the outlook remains less optimistic. For example, on the Atlantic coast, many Parisians are opting to spend the summer in their second homes, leaving local vacation rental managers with fewer properties to rent out and thus reducing their potential revenue.
