Global hotel room rates rise for fourth year running

Gurjit Degun
10 March 2014

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10 March 2014 | Gurjit Degun

The average price of a hotel room increased by 3 per cent during 2013, signalling rising rates for the fourth consecutive year.

The Hotel Price Index (HPI) was set at 100 in 2004 and tracks the prices that hotel guests paid for their accommodation around the world. The 2013 HPI stands at 110, seven points lower than its peak in 2007 despite the recent growth.

New Orleans in the US saw the biggest year-on-year percentage price rise at 22 per cent. The average room rate was £146 in 2013, compared with £120 in 2012. On the other end of the scale, Hanoi in Vietnam saw a 20 per cent drop from £49 in 2012 to £39 last year. Monte Carlo in Monaco continues to be the most expensive area to stay with in room rates costing an average of £198 in 2013, a two per cent rise, year-on-year.

Latin America saw the strongest rise in room rates, with a 5 per cent increase, overtaking its previous peak set before the global economic downturn. “With reports stating that emerging markets are showing solid economic growth, prices rose as demand intensified,” the HPI said.

Average prices in North America rose by 3 per cent, matching the global rise. In Europe and the Middle East, hotel rates grew by 2 per cent. The HPI said that several European areas that were worst hit by the economic downturn have seen their prices stabilise, and some have seen “healthy increases”.

The Pacific region saw no change in average prices over 2013. According to the HPI, “softer domestic corporate travel” in Western Australia and the drop in value of the Australian dollar towards the end of the year “had a dampening effect on the overall average”.

However, Asia saw a 2 per cent drop in prices as it “continues to offer some of the world’s best value hotel accommodation,” the HPI noted. It added: “The depreciation of the yen, rupee and rupiah, coupled with a decrease in inbound visitors to China contributed to this result, although outbound travel from China remains buoyant. There continues to be a longer term trend of increased travel within the region.”

Johan Svanström, president of the brand, said that the growth in global hotel prices reflects trends noted by the United Nations World Tourism Organization. It said international tourist arrivals in 2013 grew by 5 per cent to a record global figure of 1.08 billion, well above expectations.

“Looking ahead, one phenomenon impacting global hotel prices in 2014 is the huge rise in the number of sports fans travelling this year, with the Sochi Games in February and March and the World Cup in Brazil in the summer,” he added.

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