With travel picking up post-pandemic, the hotel industry has seen occupancy rise across the board and the revenue they earn per room has also seen a seven percent increase versus the pre-COVID times. However, India's travel pattern might have evolved during the pandemic opening up a new opportunity for homestay businesses. In fact, tourist-friendly destinations like Goa have seen a demand for homestays impact the traditional hotel business there.

Patanjali Keswani, CMD at Lemon Tree Hotels says that homestays have affected their business in markets like Goa. But on an aggregate basis, they have not really moved the needle.

"Goa I can definitely see the impact not only for us but for hotels in general that many people are preferring to go to homestays,” he told CNBC-TV18 in an interview.

Devendra Parulekar, Founder of SaffronStays there is no competition between homestays and hotels.

"Honestly, there is no competition I think it's coexistence. I think the large mainstream hospitality industry has also realized that they need to complete that part of the portfolio and hence are building out their arms in homestays and villa rentals,” he explained.

He in fact believes that there is a gross undersupply in the homestays segment.

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Seasonal travel

When it comes to the holiday season, the hotel industry has seen an upsurge in advance bookings for the month of December due to high flight rates.

“The month of December has been a surprising packet. This year, for the first time I am seeing bookings for December having been done in October, and November itself. A lot of advance booking and one of the reasons is very, very high flight tickets,” said Parulekar.

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(Edited by : Abhishek Jha)