Paris Olympics: Hoteliers and Airbnb owners slash prices as demand lags behind supply

With the countdown to the 2024 Olympic Games in Paris well underway, the city is gearing up to welcome an influx of approximately 15 million tourists. However, amidst the excitement, a curious trend is emerging: accommodation prices are dropping as supply surpasses demand.

Data from insurance firm Réassurez-moi reveals a significant decrease in the cost of booking a night in Paris or its neighbouring areas during the Olympic period. In April, the average price plummeted to €436, marking a sharp decline from the €1,023 recorded in July of the previous year. Experts assert that an oversupply of lodging options primarily drives this downward trend.

In a recent statement to Reuters, Paris Deputy Mayor for Housing, Jacques Baudrier, emphasised the expectation of moderate accommodation prices, saying, "As for the [accommodation] prices, I don't expect them to be sky-high as the market is going to regulate all this."

Consultancy firm Deloitte's 2023 prediction anticipated a boost in income for Airbnb hosts, estimating an average of €2,000 in additional earnings during the Olympic Games. Airbnb itself echoed this sentiment, declaring Paris 2024 as potentially its most significant hosting event.

Notably, more than traditional accommodations contribute to the surge in available lodging options. Even more, locals are seizing the opportunity to rent their apartments, enticed by the promise of supplemental income. While the Olympics have booked approximately one-third of available Airbnb rentals in the Paris area, data analytics group AirDNA reports that the supply continues to expand. An array of choices presents itself to visitors, with an estimated 3,000 to 3,500 new listings appearing monthly.

Meanwhile, hotels are adjusting their pricing strategies to remain competitive against the burgeoning Airbnb market. Frédéric Hocquard, Paris Deputy Mayor for Tourism, disclosed concerns within the hotel industry, indicating a fear of losing clientele to alternative lodging options.

The balancing act between attracting tourists and ensuring affordability is crucial, particularly considering the additional expenses associated with attending sporting events and travelling to the capital. As accommodation providers navigate this delicate balance, the Parisian landscape promises to offer tourists a range of options at more accessible price points.

As the city prepares to ignite the Olympic flame, the accommodation sector stands as a testament to Paris's adaptability, demonstrating resilience in the face of evolving tourism dynamics. With prices on a downward trajectory and supply surpassing demand, visitors to the City of Light may find themselves pleasantly surprised by the affordability of their Olympic experience.