Core Viewpoint - The article discusses the recent investments by major players like Ctrip and New Oriental in the high-end homestay market, highlighting the challenges and trends within the industry, including intense competition and the shift towards high-end, boutique offerings. Group 1: Investment Activities - Ctrip acquired a 67% stake in Shanghai Shanhai Youye Hotel Group for 2,626,000 yuan, indicating a strategic move into the high-end homestay sector [1][2] - New Oriental has also invested in a niche high-end hotel brand, increasing the registered capital of Xizang Songzan Green Valley Cultural Tourism Co., Ltd. from approximately 170 million yuan to about 200 million yuan, with New Oriental holding about 12.4% [3] Group 2: Industry Challenges - The homestay industry is facing severe homogenization and price wars, leading to declining profits for operators [5][7] - A report indicates that the average occupancy rate for homestays in China in 2024 is projected to be 33%, the highest in five years, but the average room price is expected to drop to 502 yuan per night, the lowest in five years [8] Group 3: Market Trends - The demand for high-end homestays is increasing, with 30.9% of homestay demand exceeding 400 yuan per night, reflecting a shift towards better travel experiences [14] - The market for homestays in China reached 42.27 billion yuan in 2024, with financing in the sector hitting 4.49 billion yuan, the highest in seven years [18] Group 4: Future Outlook - The integration of the elderly care industry with cultural and tourism sectors is expected to create new opportunities in the homestay market, particularly for high-end projects catering to the aging population [20][21] - The article suggests that only group-oriented, chain, and branded homestay businesses will be able to achieve profitability through economies of scale [16] Group 5: Operational Challenges - High-end homestays typically have fewer rooms, averaging between 15 to 20, which leads to longer payback periods; for instance, a project in Zhongwei requires an investment of 12 million yuan and an estimated four years to break even [29] - Ctrip's previous attempts to establish a homestay brand through franchise models have not been successful, raising questions about its operational capabilities in this sector [30]