Hostels outperform hotels as accommodation demand shifts to lower-cost options – GSS

Hostels recorded significantly higher occupancy rates than several hotel categories in Ghana between November 2024 and February 2025, highlighting major differences in how accommodation facilities are being utilised, the Ghana Statistical Service (GSS) has reported.

According to the Service’s Accommodation Unit Survey, hostels recorded room occupancy rates of about 91% to 95% during the period, with standard hostels recording particularly high room occupancy of approximately 96% to 99%.

This compares with significantly lower utilisation among some hotel categories.

In February 2025, for instance, 1-star hotels recorded a room occupancy rate of just 28%, with bed occupancy at 24%.

The figures reveal a wide performance gap within Ghana’s accommodation industry, despite hotels accounting for about 70% of available room capacity and roughly 55% to 60% of occupied rooms each month.

The GSS says the differences demonstrate why national accommodation averages can conceal important variations between different types of establishments.

Different markets, different performance

The strong performance of hostels comes against a backdrop of overall national room occupancy remaining below 50% during the four-month period.

National room occupancy stood at 44.7% in November 2024, peaked at 46.6% in December, declined to 44.1% in January 2025 and returned to 44.7% in February.

The GSS says accommodation businesses should therefore assess performance based on factors including occupancy, pricing, guest mix and length of stay rather than relying only on the number of rooms available.

The Service notes that the particularly high utilisation of hostels, alongside lower occupancy in some hotel categories, demonstrates why accommodation establishments should not assess performance based on capacity or room rates alone.

Implications for investors

The findings could have implications for investment decisions within Ghana’s accommodation sector.

The GSS recommends that investors and financial institutions consider demonstrated demand and utilisation when assessing accommodation investments, rather than focusing solely on the amount of available capacity.

The Service also says businesses should routinely monitor occupancy, Average Daily Rate, Revenue per Available Room, guest composition and length of stay to guide pricing, marketing, service delivery and market positioning.

The report cautions that the findings cover only four months of a planned 12-month survey and should therefore be treated as an emerging baseline rather than evidence of a long-term trend.