US Hotel Industry Faces Declines in July 2025

The U.S. hotel industry recorded another month of decline in July 2025, with key performance metrics falling compared to the same period last year, according to new data from CoStar.

Occupancy dropped to 68.2%, down 1% year-over-year. The average daily rate (ADR) slipped 0.1% to $161.90, while revenue per available room (RevPAR) declined 1.1% to $110.37. New York City led the country with the highest occupancy levels but still saw a 1.1% decrease from July 2024.

Industry analysts pointed to weaker international visitor numbers and economic uncertainty tied to ongoing tariff disputes as major factors weighing on consumer confidence. June had already reported sharper declines in occupancy and RevPAR, underscoring a challenging summer season for hotels.

Earlier this month, CoStar and Tourism Economics revised their U.S. hotel forecast for 2025–26, citing “elevated macroeconomic concerns.” They now expect full-year demand to decline 0.6%, ADR to fall 0.5%, and RevPAR to drop 1.1%. Projections for 2026 were also downgraded, with modest decreases expected across all three metrics.

“Unrelenting uncertainty and inflation, coupled with tough calendar comparisons and changing travel patterns, have caused lower demand,” said STR president Amanda Hite. She added that performance may stabilize once trade disputes ease and recent economic policies take effect.

While the U.S. struggles, global markets are trending upward. Canada, for example, reported its strongest occupancy since before the pandemic in July, with gains of 3% in occupancy, 5.3% in ADR, and 8.5% in RevPAR.

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