Hotel Occupancy Rates in Kyoto Reach New Heights, Driven by Chinese Visitors

Kyoto continues to immerse itself as one of Japan’s most vibrant cities, despite a decline of 7% in average daily rates of hotel rooms for a total of 17,000¥. DMO’s recent report, structured around August 2025, indicates that hotel occupancy in the city grew by 4.9% year-on-year. As a result, the new average hotel room occupancy for the 113 listed hotels stands at 76.6% per hotel room. This new global tourism data indicates that China remains one of the city’s primary generators.

Kyoto city’s most recent average daily hotel rates remain competitive to the global market. Since the prior year’s hotel rates averaged 18, 000¥ per hotel room, the new rates remain competitive to the market. China’s tourism data indicates that the city continues to remain world-renowned for its stunning towers, UNESCO world sites, along with the reassuring and tranquil soothing of the ever-flowing city.

In August of 2025, hotel occupancy rates have increased due to foreign tourist arrivals. International guests spent over 584,655 nights, which converts to 64.4% of total overnights in Kyoto which is an increase of 16.3%. For several years, China is still the most important origin of overseas visitors.

2025 Kyoto Hotel Performance

Lowering rates for hotel rooms in Kyoto for August 2025 was found to be an average of ¥17,000 an ADR. This is a 6.7% drop compared to the previous year. Despite a reduction in the price of hotel rooms, the occupancy rates are still on the rise. The data suggests the pricing is becoming more competitive and there is a growing need for hotel rooms. Shifting the position of Kyoto to lower-level competitive pricing has emerged due to the recovering tourism after the pandemic.

On the other hand, while the overall hotel sector may be improving, the situation with ryokans (Japanese inns) continues to be unfavourable. For example, the occupancy rate of 22 ryokans in Kyoto in August 2025 was only 36%, which is a 6.5% drop from the same month the previous year. This is a clear indication of a shift in travel preferences, with the majority of travelers choosing to stay in modern hotels instead of traditional ryokans.

The Influence of Chinese Travelers on the Demand for Hotels

The increasing volume of requests from Chinese tourists is one of the factors that has drove the high occupancy rates in Kyoto. Besides China, the city has deep cultural and historical ties with Chinese traditions, which makes it a good travel destination. The city is expected to do well during the period spanning Japan peak National Day holiday from 1st to 12th October, with occupancy rates exceeding 90% during the first week of October. This period is renowned for its tourism boom, and the expected high volume of Chinese travelers coming to Kyoto during that period is expected to greatly benefit the city.

Looking Ahead: Falling Tourism Forecast for the Season

Kyoto continues to maintain a positive forecast for tourism in the upcoming months as hotel occupancy rates seem to increase easily. DMO Kyoto, a tourism research company, expects the city’s occupancy rate in September to be 77.9% which steadily increases in the following months. The October occupancy rate is set to reach 86.2% while November dips slightly to 84.9%. The tourism demand coming from China and international fans, along with the allure of Kyoto’s autumn foliage, contribute to the steady increase in occupancy during these months.

Autumn is equally appealing and encouraging for the tourists coming to Kyoto to experience the Koyo (monk eastern foliage). These tourists find the city’s parks, temples, and gardens aesthetically stunning, especially with the maple leaves at the height of the display. For those in search of some culture, the district of Gion, Arashiyama bamboo grove, and Kiyomizu-dera, along with the Gion district provide enough to satisfy one’s searching.

Problems Delaying the Advancement of the Tourism Sector

Though Kyoto has continued growing in terms of tourism, there are still some issues that need to be resolved, especially when it comes to the ever-increasing demand and the supply of accommodation facilities. This issue of lagging ADR for hotels in 2025 suggests that some of the market players are engaging in some aggressive price competition. Also, the drop the in the occupancy rate of the ryokans indicates that the visitors may be shifting to modern hotels, which may have far-reaching implications for the traditional accommodation facilities in Kyoto.

Another source of concern, still ongoing, is making certain that the relevant infrastructure such as the public transport, restaurants and other social servic,e can cope with the growing number of arriving tourists. In coordination with the other tourism bodies, the local authorities are working to enhance the ease of access and the sustainable nature of the approach to tourism in such a way that the tourism flows will be beneficial for the local community and businesses.

Conclusion

In regards to the attractiveness of its cultural values, breathtaking scenery, and the many unique experiences it has to offer, Kyoto was, and remains the focal point of international tourism in Japan. Although the influx of tourists, especially from China, has had a positive impact on the hospitality industry, the region’s tourism and hospitality industry continues to grapple with meeting the evolving tastes of tourists while ensuring sustainable expansion. Kyoto’s continued dominance as a global tourism hub thus, remains undisputed, especially with the prospects of further enhanced occupancy in the near future, and an emphasis on cultural tourism.

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