The RAAS Group has been a part of the real estate industry since 2002 and has evolved to be one of the largest Management Rights specialists in Australia. But we are so much more than just specialists.

Spring 2025: What’s Moving the Needle Across Regional Accommodation

Australia’s spring selling and travel seasons have arrived with plenty of heat, just not always where you expect it.

ACCOM SPRING NEWSLETTER

Regional Accommodation: Making Every Booking More Profitable

RevPAR Is Rising, But Margins Are Tight: How Smart Operators Are Winning in Australia’s Regional Accommodation Market

Australia’s accommodation sector is enjoying a spring resurgence, with occupancy rates climbing and RevPAR (Revenue per Available Room) pushing to new highs in many regional areas. Yet for most operators, it doesn’t quite feel like boom time. Rising energy costs, chronic labour shortages, and legacy systems are quietly eating away at profits.

For every property that’s seeing real growth, there are others finding that higher revenue doesn’t always mean higher returns. The difference comes down to strategy, and the operators who thrive in 2025 are those embracing smarter pricing, targeted investment, and a more nuanced understanding of their guest base.

This deep dive explores the state of play across regional accommodation, and the four key areas where the most profitable operators are pulling ahead:

 

                  1. Smarter pricing and event targeting

                  2. Technology adoption and cloud PMS

                  3. Value-add guest strategies

                  4. Focus

                  5. ed capital upgrades that actually pay

                  6. The dual opportunity of digital and grey nomads

 

Occupancy Strong, Profit Margins Squeezed, The New Normal

While Australia’s post-pandemic travel boom has normalised, regional demand remains robust. According to Tourism Research Australia’s 2025 quarterly report, domestic overnight trips increased 6.8% over the past year, and total visitor spend rose 9%. Markets like the Sunshine Coast, Port Macquarie, Byron Bay, and the Whitsundays are seeing consistent year-round demand.

However, despite full books in many motels, holiday parks, and serviced apartments, owners are discovering that their net operating profit is shrinking. Why? Costs have outpaced room rate growth.

  • Energy: Electricity and gas costs have risen between 18% and 25% since mid 2023, driven by wholesale price volatility and limited regional grid competition.

  • Labour: The minimum wage rise and tight hospitality job markets have increased payroll expenses by 10–15%. Many properties are relying on expensive temp staff or shorter rosters.

  • Insurance and compliance: Weather-related premiums and WorkSafe compliance checks are adding unexpected overhead.

  • Technology lag: Properties still using manual systems or outdated PMS software spend more time reconciling bookings and chasing payments, losing hours that could be used on marketing or guest service.

This combination means that while RevPAR is trending upward, the Gross Operating Profit per Available Room (GOPPAR), a more meaningful measure of profitability, has either plateaued or fallen.

To adapt, the top operators are changing focus. Instead of chasing sheer occupancy numbers, they’re improving revenue quality per stay, extracting more value through smarter yield management, automated efficiency, and operational discipline.

It’s the shift from “filling rooms” to “monetising moments”: every guest touchpoint, every rate decision, and every operational process must contribute to profit, not just revenue.

Smarter Pricing & Event Targeting

Dynamic pricing is no longer just for airlines and five-star hotels — it’s now a must-have tool for regional accommodation providers. Yet many small and mid-size operators still rely on flat rate sheets, missing thousands in potential income each year.

Why Dynamic Pricing Matters

The travel environment is more volatile and localised than ever. School holidays, sporting tournaments, conferences, and even weather forecasts can trigger short-term demand spikes. Tools like SiteMinder, Cloudbeds, and Little Hotelier now allow small operators to automatically adjust rates in real time across multiple channels.

A Sunshine Coast motel using automated dynamic pricing recently reported a 12% RevPAR increase year-on-year simply by aligning weekend rates to nearby event calendars and adjusting midweek pricing based on forecasted occupancy.

Event Targeting in Practice

Successful operators don’t just respond to demand, they predict it. They map out annual local events (marathons, surf carnivals, agricultural shows) and build micro-campaigns around them:

  • Geo-targeted ads for accommodation near event venues

  • Early bird packages offering value-adds instead of discounts

  • Dynamic minimum stays (2-3 nights) during high-traffic periods

When occupancy dips midweek or outside holiday periods, these same operators pivot, offering corporate or “stay-and-work” packages with late check-outs and bundled breakfasts to maintain base revenue.

The Technology Behind It

Revenue management software (RMS) is now accessible and affordable. Even a 20-room motel can use algorithms to compare competitor rates, seasonality, and online reviews, then push optimal pricing to OTAs and direct websites automatically.

Operators using RMS platforms typically see:

  • +8–15% uplift in average daily rate (ADR)

  • Reduced manual workload by 3–5 hours weekly

  • Improved direct booking ratios, saving commission fees

Dynamic pricing isn’t about charging more — it’s about charging right. By balancing occupancy and yield intelligently, small operators can compete with major chains while maintaining their regional authenticity.

Technology Upgrade: Cloud PMS Over Whiteboards

Many regional properties still juggle whiteboards, spreadsheets, and phone diaries to track bookings. It might feel familiar, but it’s inefficient — and often costs far more in lost opportunities than the subscription to a modern PMS (Property Management System).

What Cloud PMS Delivers

A good PMS acts as your digital control tower. It centralises reservations, guest communication, housekeeping, invoicing, and channel management in one secure system. Cloud-based systems like RMS Cloud, GuestPoint, NewBook, or Little Hotelier allow real-time updates across all OTAs and your direct website, preventing double bookings and ensuring rate parity.

Operational Benefits

  • Automation: Pre-arrival emails, SMS reminders, and upsell prompts cut no-shows by up to 25%.

  • Housekeeping sync: Real-time room status updates keep teams coordinated, reducing turnaround delays.

  • Data capture: Every guest profile becomes part of a loyalty database, enabling personalised marketing for repeat visits.

  • Financial accuracy: Integrated reporting tools handle GST, end-of-day balancing, and performance analytics automatically.

Cloud PMS adoption also reduces your dependency on reception hours. A growing number of motels and parks now operate remote or hybrid check-in models, freeing owners from constant on-site supervision.

Cost vs Return

Most systems charge between $100–$300 per month, less than one night’s lost booking due to human error. Operators who migrate to cloud PMS often recover the cost within the first quarter through improved efficiency and reduced OTA commission wastage.

Ultimately, investing in technology isn’t about replacing people; it’s about freeing them to deliver better guest experiences instead of paperwork.

Value-Adds Beat Discounts

In a competitive booking environment, many operators default to lowering prices to stay visible. But price wars are unsustainable — they condition guests to expect less and erode brand value. The smarter approach is adding perceived value without cutting into profit margins.

Experience Over Price

Guests now rank experience higher than cost. According to Booking.com’s 2025 traveller insights, 64% of Australian travellers will pay more for stays that feel personalised. Operators are responding by curating small, memorable extras:

  • Early check-in or late check-out flexibility

  • Complimentary welcome drinks or snack hampers

  • Partnerships with local cafes or tour providers

  • Pet-friendly packages or eco-friendly amenities

These gestures create emotional connection, and positive reviews that feed the booking algorithm. Remember, a 0.5-star bump on Google or Booking.com can raise ADR by up to 6%.

Bundled Experiences

Instead of dropping nightly rates, properties are bundling inclusions: “Stay & Dine” (accommodation + meal voucher), “Adventure Weekends” (accommodation + local tour), or “Remote Work Packages” (weekly stays with premium Wi-Fi and workspace).

Bundled offers feel like upgrades rather than discounts, guests get more, operators keep margin integrity.

The Review Effect

Satisfied guests are your most potent marketing channel. Word-of-mouth remains dominant in regional travel, and each five-star review can influence hundreds of future bookings. Adding value doesn’t just lift satisfaction, it multiplies your digital footprint.

In short, stop selling cheaper stays and start selling smarter experiences.

Motel Makeovers & Upgrades That Pay

Capital works can make or break your ROI. Too many operators overspend on cosmetic renovations that don’t impact booking decisions. The highest-performing motels and parks follow a strategic refurbishment model, focusing spend where guests notice first.

Bathrooms First

Bathrooms consistently rank among the top three booking drivers (after location and reviews). Clean, modern design cues — matte tiles, frameless screens, rainfall showers, LED mirrors — evoke luxury without overspend. A $6,000 bathroom refresh can justify $10–$20 extra per night, recouping investment within 18 months.

Smart Access & Energy Upgrades

Contactless entry systems allow 24/7 check-in and cut reception staffing costs. When integrated with PMS, they track occupancy automatically and support loyalty data capture. Adding solar panels or sensor lighting can reduce power bills by 20–30%, paying for itself within 3 years.

Exterior & First Impressions

Your frontage is your first conversion tool. Repainting facades in neutral palettes, upgrading signage to LED, trimming landscaping, and adding solar bollards immediately raise perceived quality. According to STR research, exterior upgrades yield an average 11% uplift in RevPAR within the first year.

What Not to Do

Avoid large furniture or flooring replacements unless you’re repositioning the property’s target demographic. Focus on ROI-linked projects and sequence them to cashflow cycles (bathrooms first, tech second, décor last).

Every upgrade should serve two goals: enhance guest satisfaction and reduce operating costs. When both align, your valuation rises, not just your nightly rate.

The Nomadic Opportunity: Two Audiences, One Park

Australia’s regional tourism market now caters to two powerful long-stay audiences, digital nomads and grey nomads, whose combined influence is reshaping caravan parks and motels nationwide.

Digital Nomads

The rise of remote work has created a new traveller segment seeking flexible, affordable accommodation with reliable connectivity. These guests value strong Wi-Fi, quiet workspaces, and community. Parks offering “Work from Nature” packages, private cabins with desks, and early check-in options are seeing midweek occupancy climb by 15–20%.

To attract them, savvy operators are:

  • Advertising “Remote-Work Friendly” status on OTAs

  • Installing high-speed mesh Wi-Fi and ergonomic work pods

  • Offering discounted multi-week rates with inclusive utilities

  • Promoting local lifestyle experiences (surf, hikes, markets) on social channels

Grey Nomads

Australia’s retirees remain the largest and most loyal domestic traveller base. They prioritise consistency, cleanliness, and community, not gimmicks. Parks that provide pet-friendly options, social BBQ areas, and loyalty rewards earn repeat stays season after season.

Offering dual messaging, quiet weekday zones for digital workers and social evening events for retirees, maximises occupancy while maintaining harmony.

Combined, these two audiences smooth out the seasonal peaks that have historically defined park profitability. The key is flexible design: spaces that can transition between uses, marketing that speaks to both lifestyles, and pricing models that reward extended stays.

The Payoff

Operators who embrace this demographic duality report stronger off-peak occupancy, higher review ratings, and longer average stays, without resorting to price cutting.

In essence, it’s about community over commodity. Guests aren’t just renting space; they’re joining an experience.

Precision is the New Profit

The regional accommodation market is thriving, but the smartest operators know that revenue without efficiency is just noise.
As RevPAR rises, so must your systems, strategy, and service standards.

Profit in 2025 will favour the precise — those who:
✅ Use data-driven pricing instead of guesswork
✅ Automate for efficiency and guest experience
✅ Invest in upgrades that deliver measurable return
✅ Serve both emerging and legacy traveller segments with authenticity

At Ras360, we continue to work with accommodation owners and management rights operators across Queensland and NSW to help them adapt, grow, and position for the next cycle.

Because in this market, staying full isn’t enough, staying sharp is what defines success.

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