ADR — Average Daily Rate
Average Daily Rate (ADR) is the average revenue earned per rented night, calculated by dividing total rental revenue by the number of booked nights.
ADR is one of the two primary performance metrics for short-term rental properties — the other being occupancy rate. Together, these two metrics determine your RevPAR (Revenue Per Available Night), which is the most comprehensive single measure of STR performance.
Unlike occupancy rate, which measures demand, ADR measures your pricing power. A property with a high ADR but low occupancy may be overpriced for its market; a property with a low ADR and high occupancy may be leaving money on the table. The goal is optimizing both simultaneously.
ADR varies significantly by market, property type, seasonality, and amenities. Nationally, STR ADR averages around $170–$220, but properties in premium vacation markets (coastal, ski, theme park areas) routinely achieve $300–$600+ nightly rates. Urban short-term rentals tend to have lower but more consistent ADR.
Dynamic pricing tools like PriceLabs and Wheelhouse analyze real-time demand data, local events, and competitor pricing to optimize ADR automatically. Professional STR investors typically see 10–20% ADR improvements after implementing dynamic pricing.
Formula
ADR = Total Revenue ÷ Number of Booked NightsCalculate It
Quick Calculator
ADR = Total Revenue ÷ Booked Nights
Average Daily Rate
$250
Worked Example
A property earns $18,000 in revenue over 90 booked nights. ADR = $18,000 ÷ 90 = $200 per night.
Related Terms
Related Calculators
Frequently Asked Questions
What is a good ADR for an Airbnb?+
A "good" ADR depends heavily on your market and property type. Nationally, the average STR ADR is $170–$220. Strong vacation markets command $250–$500+. Evaluate your ADR against comparable local listings — if your ADR matches market comps and your occupancy is above 60%, you're pricing well.
How do I increase my Airbnb ADR?+
The most effective ways to increase ADR: implement dynamic pricing (10–20% improvement is common), add high-value amenities (hot tub, pool, EV charging), improve photography and listing copy, earn Superhost status, increase minimum stay requirements during peak periods, and focus on premium guest segments.
What is the difference between ADR and nightly rate?+
Nightly rate is the price listed for a specific night. ADR is the average of all nightly rates actually collected across booked nights over a period. ADR accounts for seasonal variation, discounts, and length-of-stay adjustments — it's a more accurate measure of your property's actual revenue performance.
How does ADR affect cap rate?+
Higher ADR directly increases gross revenue, which increases NOI, which increases cap rate. A $25 ADR increase on a property booking 200 nights/year adds $5,000 to gross revenue. After operating expenses (assume 45% ratio), that's $2,750 additional NOI. On a $500,000 property, that's a 0.55 percentage point cap rate improvement.
What is RevPAR vs ADR?+
ADR measures revenue per booked night; RevPAR measures revenue per available night (including vacant nights). RevPAR = ADR × Occupancy Rate. A property with $200 ADR and 62% occupancy has a RevPAR of $124. RevPAR is a better overall performance metric because it captures both pricing and demand efficiency.