Cheaper gas helped revive July travel demand, Hostfully index shows

Lower gas prices helped put the road trip back in focus in July, a signal investors may want to watch across travel, hospitality and consumer-discretionary stocks. Hostfully reported that its Hosting & Travel Index rose 14.3 points from June to a Getaway Score of 63.5 out of 100, the largest monthly increase since the index began.

The move came as several consumer pressure points eased at once. The national average price for gasoline fell to $3.86 a gallon, down 15% in six weeks and below $4 for the first time since late March. Consumer sentiment rose 10.5%, the second-biggest monthly gain on record, according to the University of Michigan. AAA projected that 72.2 million Americans would travel during the July 4 week, an all-time high, with 85% expected to drive.

For retail investors, the read-through is straightforward: cheaper fuel can free up household cash for trips, meals, attractions and lodging. Sentiment matters too, because a consumer who feels better about the economy is more likely to spend on discretionary categories, meaning purchases people can delay when budgets get tighter.

Hostfully’s index tracks seven inputs tied to the U.S. vacation rental and travel market: TSA throughput, Google search trends, gasoline prices, lodging inflation, consumer sentiment, weather and booking data from its own platform. In July, five of those improved: sentiment, gas, TSA traffic, search trends and weather. Hostfully platform data was flat, while consumer price data for lodging moved against the broader trend.

Margot Schmorak, Hostfully’s co-founder and CEO, said gas prices, sentiment and the July 4 travel forecast lined up in the same month, adding that travelers returned faster than they had pulled back.

Prices remain the friction point. Lodging consumer price inflation, or CPI, reached 4.2% year over year in May, the highest reading since 2023. Travel-related prices were uneven: airfares rose 26.7% year over year, while hotel prices increased 5.1%. The U.S. Travel Association’s Travel Price Index was up 9.8% year over year, marking its fourth straight month of acceleration.

That mix points to a summer where demand may be healthier, but travelers are still watching the total bill. Hostfully framed July as a stronger environment for driving than flying, with the fuel savings helping road trips while airfare inflation remains elevated. The company’s July vacation rental and travel index also showed regional differences that could matter for companies with exposure to specific markets.

Every U.S. region improved in July, but the Southeast led with a score of 78.0, entering Hostfully’s “Partly Sunny” category for the first time this year. The Midwest remained the weakest region at 48.0. The 30-point gap between the two was the widest since the index launched in April.

The strongest individual markets were all in Southeast beach or leisure destinations, with Destin, Florida at 82.5, Myrtle Beach, South Carolina at 82.0, Gulf Shores, Alabama at 81.5, Outer Banks, North Carolina at 80.5, and Gatlinburg, Tennessee at 80.0. Jackson, Mississippi rose 13.5 points, and Lake Tahoe, California gained 12.0 points. Houston fell 3.5 points and Galveston declined 3.0 points, with both affected by the path of Tropical Storm Arthur, according to Hostfully.

Hostfully serves vacation rental hosts and property managers in more than 100 countries. Its index covers more than 50 U.S. metro areas and draws on data from TSA.gov, the Bureau of Labor Statistics, the University of Michigan, AAA, NOAA, Google Trends, AirROI, the U.S. Travel Association and Hostfully booking data.