Asheville's Hotels Are Losing Ground. Vacation Rentals Are Gaining It.

By Jon Tharp, Broker  ·  August 28, 2026

Two Recoveries, Moving in Opposite Directions

Buncombe County's tourism industry is not recovering evenly, and this week's numbers make that clearer than ever. Vic Isley, president and CEO of Explore Asheville, walked the county's Tourism Development Authority board through the latest lodging data, and the picture split cleanly in two. Hotels are sliding. Vacation rentals are holding their ground.

June had been a relatively strong month across the board. Then July arrived, and hotel business softened noticeably while short-term rentals kept climbing. It is a small shift on paper, but it signals a bigger change in Asheville's tourism economy nearly two years after Hurricane Helene reshaped the region.

Hotel occupancy in Buncombe County reached 70 percent in July, down a single point from a year earlier but a steep 11 points below where it stood in 2019. Zoom out to the full year, and the average through July sits at 62 percent, four points below 2025 and nine points below pre-pandemic norms. Vacation rentals, meanwhile, held at 55 percent occupancy, unchanged from the previous two years and actually a point higher than 2019.

Neither number is spectacular. But one is trending the wrong way while the other has quietly found its footing.

Why Hotels Lost Their Cushion

The hotel numbers look worse than they are, at least in one sense, because 2025 was never a normal baseline to begin with. In the months after Helene, FEMA's Transitional Sheltering Assistance program placed thousands of displaced residents into Buncombe County hotels while they waited for permanent housing. At its peak in November 2024, the program sheltered roughly 2,000 households this way, accounting for 22 percent of all hotel stays that month. That share dropped to 21 percent in December and 18 percent by January 2025, and the program had wound down entirely by early May 2025.

That federal voucher money was real revenue for local hotels during a genuinely difficult stretch. It also means last year's occupancy figures ran inflated compared to a normal tourism season. Now that the FEMA-funded stays are gone, comparisons measure hotels against a baseline that included demand they can no longer count on, and the drop-off shows up starkly in the year-over-year numbers.

Total hotel roomnight demand for the fiscal year running from July 2024 through June 2025 was down 8 percent year over year even with the FEMA boost included. Strip that support away and layer in a softer national business travel environment, and Buncombe's hotels are working harder for fewer heads in beds than they were before the storm.

The Vacation Rental Crash Nobody Talks About Anymore

It is easy to look at this week's numbers and assume vacation rentals sailed through the recovery. They did not. In the months right after Helene, short-term rental occupancy in Buncombe County cratered. Some reports showed year-over-year declines as steep as 45 percent, and property managers described losing roughly 30 percent of their reservations almost overnight. First-half 2025 revenue for vacation rentals was down 32 percent compared to the same period the year before.

Chip Craig, who manages roughly 200 properties through GreyBeard Realty and Rentals, put it plainly earlier this year. Things were improving, he said, but not yet back to where they had been. JT Nicasio, co-founder of the rental management company Host Haven, pointed to a less obvious piece of the damage. It was not just about missing guests. It was about losing the people who actually make short-term rentals run, the cleaners and maintenance crews who kept properties turnover-ready.

The rental inventory itself shrank too. Buncombe County had roughly 9,306 vacation rental rooms available per night at the market's peak in 2023. By July 2025, that number had fallen to around 7,000, a mix of storm damage, owners exiting the short-term market, and some properties shifting toward long-term rentals amid the region's ongoing housing crunch.

How a Smaller Market Became a Steadier One

Here is the twist. A smaller, more selective vacation rental market turned out to be a more resilient one. With roughly 2,300 fewer rooms competing for guests than at the 2023 peak, the properties that stayed in the game have filled more consistently. That is likely a big part of why occupancy has held at 55 percent, essentially flat with the last two years and a point above 2019, even while total rental revenue and inventory took a real hit.

It is a familiar pattern in any market that goes through a correction. The weakest, least competitive listings get pulled first, whether by owner choice or storm damage, and what remains tends to perform better on a percentage basis. That does not mean every rental owner in Buncombe County is doing well. It means the survivors of a rough eighteen months are now looking at numbers that would have counted as solid in a normal year.

Hotels, by contrast, are dealing with a supply-and-demand mismatch that has nothing to do with property count and everything to do with visitor behavior. Isley has noted that demand simply has not kept pace with the room supply hotels are carrying, especially with fewer group bookings and a softer national environment for business and conference travel this year.

What This Means for the County's Bottom Line

Occupancy numbers are not just an academic exercise for Buncombe County. They flow directly into occupancy tax revenue, which funds tourism marketing, event grants, and increasingly, storm recovery projects tied to the Helene rebuild. A hotel sector running nine points below 2019 levels, even as room rates have climbed since then, still represents real pressure on that revenue stream heading into the back half of 2026.

Explore Asheville has leaned on conferences and major events to help close the gap, booking more group business over the past two years than at almost any point before. That strategy works better for hotels, which have the ballroom and meeting space conferences need, than it does for vacation rentals, which mostly serve leisure travelers. It is one reason officials remain cautiously optimistic about the fall season even with the softer summer numbers, since group business tends to pick up in September and October across Asheville, Black Mountain, and the rest of Buncombe County.

Vacation rentals do not benefit from that conference pipeline in the same way, but they have their own advantage. Weekend getaways, extended family trips, and remote workers looking for a change of scenery all favor a house over a hotel room, and that demand has proven sturdier through the recovery than the group and business travel hotels depend on.

A Region Still Finding Its New Normal

Nearly two years removed from Helene, Buncombe County's tourism economy is not simply bouncing back to where it was. It is settling into a different shape. Hotels, which leaned hard on displaced-resident stays during the worst of the crisis, are now facing a harder truth about underlying demand once that support disappeared. Vacation rentals, which took the more painful and visible hit right after the storm, have emerged smaller but steadier.

Neither side of the lodging market is fully healed. Hotel occupancy remains well below 2019 benchmarks, and vacation rental owners are managing a market with thousands fewer active listings than it had three years ago. But the direction each is heading matters as much as where each one stands today, and right now, short-term rentals are the ones moving the right way.

For anyone weighing whether now is the time to buy a cabin or investment property in the Asheville area, these occupancy trends are worth watching closely alongside the usual questions about location and price.

 

Frequently Asked Questions

Why is Buncombe County hotel occupancy down in 2026 compared to last year?

A big part of the drop comes from the loss of a temporary demand boost. In late 2024 and early 2025, FEMA's Transitional Sheltering Assistance program placed displaced Hurricane Helene survivors in Buncombe County hotels, at one point accounting for 22 percent of all hotel stays in November 2024. That program wound down by early May 2025, which means 2025's hotel numbers were inflated compared to a normal year. Without that federal voucher demand propping up occupancy, 2026 numbers look weaker by comparison, even though the underlying market has been recovering. Hotel occupancy through July 2026 sits at 62 percent, nine points below 2019 levels.

Have vacation rentals recovered from Hurricane Helene?

Largely, yes, though it took time. Short-term rental occupancy and revenue dropped sharply in the months after Helene, with some property managers reporting roughly 30 percent fewer reservations and first-half 2025 revenue down 32 percent year over year. By 2026, though, vacation rental occupancy in Buncombe County has stabilized around 55 percent, which is essentially unchanged from the previous two years and slightly above where it stood in 2019. The rental inventory itself also shrank, from a peak of about 9,306 rooms available per night in 2023 down to roughly 7,000 by mid-2025, which has helped remaining properties fill more consistently.

Are vacation rentals now more popular than hotels in Asheville?

Not exactly more popular, but more resilient by the numbers. Hotels still post a higher raw occupancy rate, 62 percent for hotels through July 2026 versus 55 percent for vacation rentals. The story is really about trajectory. Hotels are trailing both last year and pre-pandemic benchmarks by wide margins, while vacation rentals have held steady and are performing about on par with, or slightly better than, 2019. Tourism officials describe it as an uneven recovery where short-term rentals are proving sturdier through the post-Helene rebuilding period.

How did Hurricane Helene affect short-term rental availability in Buncombe County?

Helene reduced the number of active vacation rental listings in Buncombe County, partly from storm damage and partly from owners pulling properties off the market or converting them to long-term housing amid the region's housing shortage. Available rental rooms per night fell from a 2023 peak of about 9,306 to roughly 7,000 by July 2025. Some owners also faced flood damage, road access issues, and a slower-than-expected return of long-distance visitors. Property managers like GreyBeard Realty and Rentals have described the market as improving but not fully back to pre-storm levels as of early 2026.

What role did FEMA play in Asheville's hotel industry after Helene?

FEMA's Transitional Sheltering Assistance program placed thousands of displaced Helene survivors in Buncombe County hotels starting in fall 2024. At its peak in November 2024, roughly 2,000 households were housed this way, accounting for 22 percent of all hotel stays that month, dropping to 21 percent in December and 18 percent by January 2025. Every household had exited the program by early May 2025. That federally funded demand temporarily propped up hotel occupancy numbers during the worst of the recovery, which is part of why 2026 comparisons to 2025 look softer even as the broader tourism market continues to heal.