Global Hostel Market - 2023-2030

Overview

Global Hostel Market reached US$ 4.1 billion in 2022 and is expected to reach US$ 8.9 billion by 2030, growing with a CAGR of 10.2% during the forecast period 2023-2030.

The hostel market is a driving force in the global travel and hospitality industry. It provides budget-conscious travelers with affordable yet social and immersive accommodation options, appealing to a wide range of tourists, from solo adventurers to groups and families. Hostels have become an essential part of the global tourism landscape which facilitating exploration and cultural exchange.

The expansion has led to economic growth in various regions, contributing to job creation and the development of local businesses. Also, the rise of digital platforms has made booking hostels more accessible, further promoting international tourism. With an increased focus on sustainability and unique experiences, hostels continue to play a pivotal role in shaping the globally travel market.

The Asia-Pacific dominates the hostel market, holding the largest share . With its diverse tourist destinations, cost-effectiveness and rich cultural experiences, which draw backpackers and budget-conscious travelers. The region's rapid urbanization, growth in international travel and extensive hostel network contribute to its leadership in the global hostel market, showcasing Asia-Pacific as a pivotal hub for budget accommodation and diverse cultural exploration.

Dynamics

Rising Solo Travel Trend

The hostel market is expected to be driven with the growing solo traveling globally. As The hostel market is experiencing significant growth, driven by the rising trend of solo travel globally. According to Solo Traveler World, 25% of Americans (83 million people) are considering solo trips, up from 16% in 2022. The shift is due to the desire to make up for lost travel opportunities post-pandemic. Notably, 70% of solo travelers opt for group tours to destinations they're less confident about, with 66% relying on tour managers for logistics and planning.

Over 40% choose group tours for access to unique adventures and 41% prioritize safety while traveling alone. Google data shows a remarkable 761.15% increase in post-pandemic solo travel. Especially, 85% of women aged 55 + continue to travel solo. The surge in solo travel has led to a 25% increase in bookings for small tour groups, with destinations like Mackinac Island, Nova Scotia, West Virginia, Charleston and Savannah gaining popularity among solo travelers, offering safety, unique experiences and affordability.

Growing Backpacking Trends and Changing Traveler Demographics

The hostel market is witnessing growth, significantly driven by growing travelling trends. As per The Broke Backpackers report, with around 45 million backpacking trips are taken annually and 2/3 of backpackers falling in the 20-25 age group and a rising number of older travelers joining the backpacking community. Moreover, over 80% of hostel guests are millennials and solo female travelers have increased by 88% from 2015 to 2019.

Backpackers see themselves as distinct from regular tourists, valuing cultural experiences, language learning and embracing off-the-beaten-path adventures. Most backpackers still stay in hostels, with 80% having experienced hostel life. Over 30% of the world's hostels are in Asia, with Thailand and Vietnam having the most hostels. Europe remains a popular destination and South America is rising in popularity. Backpackers are also becoming more budget-conscious, with 44% staying in hotels, 28% at family or friends' places and 21% using Airbnb.

Challenges and Misconceptions

The hostel market may encounter limitations due to misconceptions surrounding hostels. Lack of awarness regarding safety, hygiene and exclusivity, particularly catering only to young backpackers, can discourage potential guests from exploring hostel accommodations. The misconceptions potentially hinder the hostel industry's growth by dissuading individuals who could otherwise benefit from the cost-effective, sociable and diverse offerings provided by hostels.

To expand the hostel market and unlock its full potential, it is imperative to debunk these myths and improve the perception of hostels to attract a wider spectrum of travelers, ultimately fostering continued growth and development within the hostel market.

Segment Analysis

The global hostel market is segmented based on accommodation, booking channel, tourist, consumer orientation and region.

Shared Dorm Rooms: The Dominant Segment in the Hostel Market

Sharing rooms holds the largest share in the hostel market. As there is growing trend for group and solo travelling, the demand shared dorm room with strangers have increased such as bunk bed rooms, it often turns into a unique and social experience. Hostels create a culture of camaraderie, where travelers from globally come together, share stories and build friendships.

The diverse mix of personalities and backgrounds makes it feel like a big sleepover, fostering an atmosphere of curiosity and little judgment. Despite potential challenges like late-night disruptions, most hostels offer smaller dorm options, allowing travelers to have a more peaceful night's sleep. The sharing room demand is growing among solo travelers as they are cheap and reliable to accommodate.

Geographical Penetration

Asia-Pacific Reigns Supreme in Hostel Market: A Resilient Travel Hub

Asia-Pacific dominates the hostel market as international tourism in the region rebounds remarkably, reaching 54% of pre-pandemic levels by Q1 2023, despite the global average reaching 80% as per United Nations World Tourism Organization (UNWTO). The robust resurgence indicates Asia-Pacific's strong position in the travel industry, making it a pivotal market for hostels.

The region's diverse attractions, cost-effectiveness and cultural richness continue to draw backpackers and budget-conscious travelers, driving demand for hostel accommodations. With a vibrant mix of destinations and growing interest from global tourists, the Asia-Pacific remains at the forefront of the hostel market's growth and resilience.

Competitive Landscape

The major global players in the market include: Wombat's The City Hostel, Generator Hostels LTD, Mad Monkey Hostels, Selina Hostels, a&o Hostels, Zostel, Nomad Hostel, The Hosteller, Onefam Hostels, St Christopher's Inns Backpackers Hostels.

COVID-19 Impact Analysis

The COVID-19 pandemic had a profound impact on the hostel market. Travel restrictions, lockdowns and safety concerns led to a dramatic drop in international and domestic tourism, causing many hostels to temporarily close or operate at reduced capacity. The resulted in severe revenue losses, staff layoffs and financial instability for hostel businesses. Health and hygiene protocols became paramount, necessitating additional investments in sanitation and safety measures.

The pandemic also shifted traveler preferences towards private rooms over shared dormitories, challenging the traditional hostel model. However, hostels adapted by offering private accommodations and implementing rigorous cleaning procedures. As travel rebounds, the hostel industry shows resilience, but full recovery hinges on the pace of global vaccination and the return of international tourism.

Russia-Ukraine War Impact

The Russian offensive in Ukraine has had a significant impact on the hostel market, primarily through its effects on international tourism. The conflict has heightened uncertainty, leading to a disruption in travel across Eastern Europe. Destinations such as the Republic of Moldova, Slovenia, Latvia and Finland have experienced a substantial drop in flight activity, with some countries witnessing a decrease of up to 69% compared to 2019 levels.

While European air traffic has shown a steady recovery, the conflict poses an ongoing threat to the tourism industry's rebound. Russia and Ukraine together represent 3% of global spending on international tourism, with a prolonged conflict potentially resulting in a loss of US$14 billion in global tourism receipts for 2022 as per United Nation World Tourism Organization. As a result, the hostel market, which relies heavily on tourism, is likely to face challenges in this uncertain environment.

By Accommodation

• Private Room
• Sharing Room
• Family Room
• Suite
• Other

By Booking Channel

• Online Booking
• In-person booking

By Tourist

• Domestic
• International

By Consumer Orientation

• Men
• Women
• Children

By Region

• North America
  • U.S.
  • Canada
  • Mexico
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Russia
  • Rest of Europe
• South America
  • Brazil
  • Argentina
  • Rest of South America
• Asia-Pacific
  • China
  • India
  • Japan
  • Australia
  • Rest of Asia-Pacific
• Middle East and Africa

Key Development

• In September 2023, Feel At Home, a provider of affordable accommodation for international students, expanded its services to cities in Australia to meet the surging demand for ready-to-move-in accommodations. The company originally founded in Ireland in 2017, later expanded to UK and Canada. Feel At Home aims to address the accommodation challenges faced by students studying abroad, offering them clean, safe and budget-friendly options upon their arrival in new destinations.

Why Purchase the Report?

• To visualize the global hostel market segmentation based on accommodation, booking channel, tourist, consumer orientation and region, as well as understand key commercial assets and players.
• Identify commercial opportunities by analyzing trends and co-development.
• Excel data sheet with numerous data points of hostel market-level with all segments.
• PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.
• Product mapping available as excel consisting of key products of all the major players

The global hostel market report would provide approximately 69 tables, 66 figures and 203 Pages.

Target Audience 2023

• Manufacturers/ Buyers
• Industry Investors/Investment Bankers
• Research Professionals
• Emerging Companies