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Measuring Market Saturation?
TLDR; "How does a smart, data-driven investor, measure market saturation?"
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Gone are the days of just buying any property, furnishing it with crappy furniture, listing it with iPhone photos, and making a killing!
I think we all know that STR&VR listings have increased year-over-year in almost every market and by large amounts in others! (my own market of Phoenix has seen an unprecedented increase of 20-25%)
So naturally, you see operators, owners, and managers saying things like "The market is saturated"
My sincere questions are:
How do you know a market is saturated?
How do you measure saturation?
What date supports your assertions?
How do you even define the word "saturation?"
In a saturated market, what should an operator expect from ADR, Occupancy, and Pacing?
When I hear talk about saturation, it's always "feelings" based rather than data-centric.
I'm earnestly seeking to be the best real estate investor I can be and I'm certain that making "feelings" based choices will lead to bad investments.
So I ask - "How does a smart, data-driven investor, measure market saturation?"
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Even if there is saturation in your area you can still stand out by having a great property in a great area with great amenities and great views.
You do this and you will still be a sought after property and repeat guests will come back year after year.
So buy right to start with!