Annual Market Wrap Up: 2025
- Posted By Andrew Morgan
Another interesting and exciting year is done, and it has gone by in a flash. It certainly doesn’t feel like a year since the last motel market wrap up. So how did the motel and accommodation industry and market perform throughout 2025? If I had to sum up the year in one word I would go with… constant. There was a constant stream of enquiries and interested buyers all year wanting to acquire motels, and a constant low level of new quality listings coming onto the market for sale. The only thing holding the market back has been the lack of quality product available for the high level of demand. Motel owners and potential sellers alike opting to take a hold position, rather than sell and take the gain, has led to a buying market that is truly unsatisfied.
The dynamics of the motel market generally demonstrate a strong correlation with the overall health of the motel industry. Elevated levels of occupancy and sustained demand for accommodation are directly associated with high demand to acquire motels. Market activity in the motel sector throughout 2025 consistently exhibited resilience. Favourable to high occupancy rates were achieved, which subsequently permitted increases in room tariffs, frequently implemented on multiple occasions during the period. Although regional variations in performance were evident, driven by localised economic variables, demand for accommodation was substantially bolstered by robust activity in the resources sector, corporate expansion necessitating labour, and widespread government investment at all levels, across numerous industries.
Reflecting upon the preceding period, the close of 2024 was exceptionally busy. Enter 2025, and while significant levels of buyer enquiry persisted, the available inventory of quality motels for sale to supply this demand remained an issue. Supply would continue to diminish and prove difficult as the year progressed. The sustained high level of enquiries was driven by serious buyers seeking quality motel investment opportunities and those wanting to get into the industry at the ground level.
The second quarter saw constant activity converting earlier enquiries into transactions. Although many transactions were subject to delays due to finance approval complexities and various other unforeseen issues. Demand for leasehold properties strengthened, with numerous contracts attracting "back-up" buyers positioned to capitalise on primary contract failures. Continuing a trend from 2024, where non-traditional finance hurdles were frequent, investors continued to self-finance their acquisitions. This dynamic effectively marginalised buyers who were financially sensitive, allowing stronger, well-capitalised investors to continue to dominate the market. While most of the business interest remained focused on freehold tenure, demand for leasehold properties showed an increase.
The third quarter sustained market growth, characterised by constant enquiry volume. Investor migration from southern states into Queensland, specifically targeting the acquisition of hospitality assets like motels, resorts, and caravan parks, continued unabated. Transactions featured a broad range of businesses, from smaller leasehold agreements (starting around $200,000) to substantial size freehold properties. Importantly, assets that had experienced longer marketing periods due to diverse circumstances began to generate significant market engagement.
The final quarter of 2025 was characterised by sustained strong activity and healthy enquiry levels. Notably, properties that had experienced prolonged periods on the market were successfully brought under contract. This robust sales activity, coupled with the tendency of owners to retain assets due to strong trading results, resulted in a substantial depletion of available accommodation businesses. The rate of quality new listings coming onto the market failed to replenish stocks. This dynamic generated considerable pent-up demand, causing buyers who had previously delayed their decisions to struggle to source appropriate assets. Consistent with the trend observed in late 2024 and 2023, sale transactions were often competitive, attracting multiple interested investors for a single asset. The old saying, “when it rains, it pours” has been said repeatedly within our office lately. As soon as a listing has an interested buyer, suddenly two more appear. Consequently, buyer demand during the year was not fully absorbed, and investors are continuing to seek new accommodation opportunities.
Moving into 2026, the industry outlook is highly optimistic. We anticipate sustained strong demand for accommodation assets, supported by the continued solid operational performance of businesses across the sector. Existing accommodation business owners are projected to maintain and increase their current levels of investment, and we expect a growing inflow of capital from non-industry sources migrating toward the accommodation sector.
We at Queensland Tourism and Hospitality Brokers (QTHB), including our Partners and Staff, are grateful for the support received from the industry this year. We wish everyone in the accommodation sector a safe, prosperous, and enjoyable year ahead in 2026.