Direct Answer
Break-even occupancy is the share of available nights you must book to cover the costs in your model. It is a risk measure, not a forecast: the important question is how far your conservative occupancy estimate sits above the break-even point.
Break-even occupancy = annual fixed costs / (365 x net revenue per occupied night)
Worked Scenario
This is a hypothetical underwriting scenario, not an expected result. Assume annual fixed costs of $30,000, a $200 average nightly rate, and $35 of platform fees, supplies, cleaning shortfall, and other booking-linked costs per occupied night.
In this scenario, the property needs about 182 occupied nights per yearto cover the modeled costs. If a conservative forecast is 55% occupancy, the cushion is only about five percentage points. A slower season, lower rates, or an omitted expense could erase it.
How to Interpret Break-Even Risk
There is no universal safe percentage. Compare the result with evidence for the same property type, submarket, and season mix, then rerun the model with lower rates and occupancy. A useful analysis asks whether the deal still covers costs when assumptions miss, not whether it clears a generic benchmark.
- Wide cushion: projected occupancy remains above break-even in a downside case.
- Narrow cushion: a modest revenue miss can turn cash flow negative.
- No cushion: the base forecast is at or below break-even and needs revision.
Include every cost you actually expect to pay. The full workflow in the Airbnb deal-analysis guide helps separate booking-linked costs, fixed operating costs, startup cash, and financing.
Stress-test your occupancy cushion
Enter your own rate, expenses, and financing to see break-even occupancy alongside cash flow.