Contents10
- Why one number isn't enough
- Occupancy rate: how full were you?
- ADR: what did you charge?
- RevPAR: what did your rooms earn?
- A worked example: a 12-room guest house
- The UK numbers to measure against
- Four mistakes that make the numbers wrong
- Beyond the big three
- Where the numbers should come from
- Frequently asked questions
Occupancy tells you how full you were. ADR tells you what you charged. RevPAR multiplies the two together and tells you what your rooms actually earned — which is the only one of the three you can take to the bank.
Most independent operators know the terms. Fewer calculate them the same way twice, and almost nobody agrees on what to include. This guide gives you the formulas, a worked example for a real-sized property, the UK benchmarks worth measuring against, and the handful of mistakes that quietly make your numbers wrong.
Why one number isn't enough
You can fill every room in the house by pricing at £40 a night. You can protect a £150 rate by selling four rooms a week. Both look like success on one metric and a disaster on another.
That's the whole reason the third number exists. Occupancy and average daily rate pull against each other, and RevPAR is the referee. When you're deciding whether to drop rates for a slow Tuesday or hold firm through a quiet February, RevPAR is what tells you whether the decision worked.
Occupancy rate: how full were you?
Occupancy rate = rooms sold ÷ rooms available × 100
"Rooms available" means room nights, not rooms. A 12-room guest house over a 30-day month has 360 available room nights, not 12.
Two decisions change the answer:
Out-of-order rooms. If a room is out for refurbishment for the whole month, most operators remove it from the denominator so the figure reflects sellable stock. Whichever you choose, be consistent — switching mid-year makes your month-on-month comparison meaningless.
Owner and complimentary stays. These usually count as occupied but not as revenue, which drags ADR down. Flag them separately if you can.
ADR: what did you charge?
ADR = room revenue ÷ rooms sold
Average daily rate covers rooms only. Breakfast, dinner, the bar, parking, the dog fee and late checkout all sit outside it. So does VAT — quote ADR net of VAT, because that's how every benchmark you'll compare against is calculated.
ADR is also blind to how you got the booking. A £120 room sold direct and a £120 room sold through an OTA at 15% commission produce identical ADR and very different bank balances. More on that below.
RevPAR: what did your rooms earn?
RevPAR = room revenue ÷ rooms available
Or, equivalently: RevPAR = occupancy × ADR
Revenue per available room spreads your room revenue across every room you had to offer, including the empty ones. It's the number that stops a good occupancy month from hiding a rate problem, and a good rate month from hiding an empty house.
Both formulas give the same answer. Use whichever you have the inputs for.
A worked example: a 12-room guest house
Twelve rooms, a 30-day month, so 360 available room nights.
Baseline | A: cut the rate | B: hold the rate | |
|---|---|---|---|
Rooms sold | 252 | 306 | 216 |
Occupancy | 70% | 85% | 60% |
ADR | £90 | £80 | £100 |
RevPAR | £63 | £68 | £60 |
Room revenue | £22,680 | £24,480 | £21,600 |
The baseline month: 252 ÷ 360 = 70% occupancy. £22,680 ÷ 252 = £90 ADR. £22,680 ÷ 360 = £63 RevPAR. (Check it the other way: 0.70 × £90 = £63.)
In scenario A you drop the rate by £10 and fill 54 more room nights. RevPAR rises to £68 and revenue is £1,800 better. In scenario B you hold £100 and lose 36 room nights. RevPAR slips to £60 and you finish £1,080 down.
On the face of it, discounting won. But scenario A also means 54 more breakfasts, 54 more room turnarounds and 54 more sets of towels — costs that RevPAR doesn't see. Scenario B's guests may spend more once they're in the building. RevPAR points you in the right direction; it doesn't finish the argument.
The UK numbers to measure against
The England Occupancy Survey put England-wide hotel occupancy at 86% in July 2026, with ADR of £198 and RevPAR of £170 — but those figures are heavily weighted by London. Strip London out and the same month shows 84% occupancy and RevPAR of £96, which is a much fairer reference point for a regional guest house. Year to date, January to July 2026 ran at 78% occupancy, level with 2025.
Two cautions before you compare yourself:
Benchmarks are seasonal. July against your February tells you nothing. Compare like month to like month, and your own year-on-year first.
Small properties move differently. With 12 rooms, one cancelled wedding party swings your monthly occupancy by several points. Look at rolling three-month figures rather than reacting to a single week.
For 2026 as a whole, PwC's UK hotels forecast projected modest growth — around 1.5% nominal RevPAR growth in the regions and 1.8% in London. If you're beating low single digits year on year, you're ahead of the market.
Four mistakes that make the numbers wrong
Counting gross OTA revenue. If your PMS records the full £120 booking value and the commission never comes back off, your ADR and RevPAR are inflated by whatever share of business comes through the channels. Some operators track a second figure — net RevPAR, after commission — precisely so they can see what direct bookings are really worth.
Mixing VAT in and out. Do it once, consistently, and net of VAT.
Letting extras leak into room revenue. Breakfast in the room rate is fine as long as you're comparing a rate-inclusive figure with other rate-inclusive figures. If you want to see total spend per room, that's TRevPAR (total revenue per available room), a separate number.
Averaging away the pattern. A month at 70% might be five nights at 100% and twenty-five at 55%. The monthly average hides exactly the information you'd use to set midweek rates. Look at the daily curve before you change anything.
Beyond the big three
Once these three are stable, two more are worth knowing:
TRevPAR — total revenue (rooms, food, bar, everything) ÷ rooms available. Useful if you run a restaurant alongside the rooms.
GOPPAR — gross operating profit ÷ rooms available. The one that accounts for the cost of all those extra breakfasts in scenario A.
Neither replaces RevPAR. They answer the next question after it.
Where the numbers should come from
The arithmetic here is simple. The hard part is getting clean inputs: every booking recorded once, cancellations and no-shows handled consistently, OTA reservations landing in the same place as direct ones, and room revenue kept separate from everything else you charge for.
That's a property management system's job, not a spreadsheet's. If your rooms are sold across Booking.com, Airbnb and your own site and reconciled by hand at month end, the numbers will be late and roughly right at best. When bookings from every channel land in one system, occupancy, ADR and RevPAR are a report you open on a Monday morning rather than an afternoon's work.
Stayvieo reports occupancy, ADR and RevPAR from your live booking data, across every channel, with no per-report charge. You can see what it costs — we publish the price — or book a demo and we'll walk through your own numbers.
Frequently asked questions
What's the difference between ADR and RevPAR? ADR is room revenue divided by the rooms you actually sold, so it only reflects the rooms that were occupied. RevPAR divides room revenue by every room you had available, occupied or not. ADR tells you about your pricing; RevPAR tells you about pricing and demand together.
Is a good RevPAR a high one? Only relative to your own market, season and property type. England excluding London ran at £96 RevPAR in July 2026 — a figure that would be excellent for a rural B&B in November and poor for a city-centre hotel in August. Your own year-on-year comparison is more useful than any national average.
Should RevPAR include VAT? No. Calculate it net of VAT so it's comparable with published industry benchmarks, which are reported net.
Do I subtract OTA commission before calculating RevPAR? Standard RevPAR uses gross room revenue, so no. But it's worth tracking a second, commission-net figure alongside it — for a property with heavy OTA reliance the gap between the two is one of the strongest arguments for pushing direct bookings.
How often should I check these numbers? Monthly for trend, weekly for the forward-booking picture. Daily RevPAR is noisy for a small property; use the daily view to spot pricing patterns instead.
What counts as "rooms available" if a room is out of service? Most operators exclude rooms that are out of order for the full period, so the figure reflects sellable stock. The important thing is picking one approach and applying it every month.
