UK Travellers Hit by Hotel Price Rises in Majority of Favourite Destinations

LONDON, March 13, 2012 - Global room rate increases 4% in 2011, says new Hotels.com Hotel Price Index(TM) (HPI(R)) Cash-strapped UK travellers faced hotel price rises last year in more than two thirds of their favourite destinations, according to a new global report released today.


The latest Hotels.com Hotel Price Index (HPI), the most comprehensive survey of room rates in the world, reveals increases in 69 of the 88 city or resort locations analysed across the world.


The fluctuating value of the Pound and a growing demand for hotels, especially from international business executives, helped to push up the global average price by 4%. However, this masked some dramatic swings in the cost of accommodation caused by historic political events including the Arab Spring and natural disasters such as the Japanese earthquake.


David Roche, President of Hotels.com, which scrutinised prices paid in 142,000 properties in over 85 countries, said: "Price volatility in 2011 meant UK travellers found it more expensive to stay in the majority of their favourite destinations abroad.


"A variety of factors, including currency movements and a growth in corporate travel, pushed up prices at a time when many consumers were already struggling to pay their bills at home.


"However, it must be stressed that room rates were still generally lower than they were in 2005 meaning hotels represented outstanding value for the hard-pressed holidaymaker looking to escape austerity Britain."

Last year, prices fell 2% in Asia year-on-year but rose in all other areas: 8% in the Pacific, 5% in North America, 4% in Latin America, 3% in the Caribbean and 2% in Europe and the Middle East.


Demand rises in US cities


UK travellers found that hotel rooms in some of their favourite US destinations were more expensive with an average 3% rise across the States.

There was less discounting amongst hoteliers in 2011 than in 2010 and business travellers drove up room demand and prices, with convention centres such as San Francisco and Las Vegas up 14% and 11% to GBP113 and GBP78 respectively. New York rose 4% to GBP173.


Prices up Down Under

The average hotel price in Australia rose 13% to GBP108 reflecting the country's strong currency and robust economy. Brisbane, which was hit by extensive flooding in January 2011, saw a 26% rise to GBP110 as business travel recovered quickly.


There was also a 12% rise in New Zealand to GBP73, fuelled by high demand around the Rugby World Cup in September-October. Earthquake-hit Christchurch saw a 41% rise to GBP81, the highest increase in the survey.


Prices keep building in BRIC nations


The strength of the booming BRIC economies of Brazil, Russia, India and China was also largely reflected in hotel rates as corporate demand increased along with domestic custom.


Rio de Janeiro was up 13% to GBP156, Moscow rose 9% to GBP164, and Hong Kong climbed 18% to GBP119, boosted by strong business as well as consumer interest from the Chinese mainland.

Natural and political events leave their mark


Asia was the only region to experience a price fall in average rates, down 2%, partly due to devastating natural catastrophes. The Japanese earthquake in March 2011 saw price cuts in Hiroshima by 16% to GBP67 and in Kyoto by 11% to GBP91. Asian destinations offered the lowest rates, with Phnom Penh on just GBP40 a night.


The Arab Spring protests and war in Libya hit prices across the Middle East and North Africa with average rates falling in Egypt by 22%, in Tunisia by 9%, in Lebanon, which borders Syria, by 21% and in Qatar by 27%.


However, the Omani capital of Muscat was the most expensive city featured in the HPI at GBP219 with demand fuelled by luxury-seeking travellers from Europe, especially Germany.


Mixed picture in Europe


London prices rose marginally by 1% to GBP115 but many traditional European city break destinations experienced steeper price rises caused by the Euro's relatively strong performance against the Pound. Amsterdam increased 9% to GBP116 and Venice and Barcelona were up 8% to GBP137 and GBP104 respectively.


The effects of the Greek debt problem triggered a 10% slump to GBP80 in Athens. However, despite similar economic difficulties, Dublin prices rallied 7% to GBP73, helped in part by the May 2011 visits of US President Barack Obama and the Queen which raised the profile of the city.


There were also significant price rises in the Baltic states with Increased demand from travelers searching for low cost destinations. Average room rates climbed in Lithuania by 14% to GBP55, in Estonia by 11% to GBP60 and in Latvia by 8% to GBP57.


The negative perception of the Middle East had a knock-on effect with many travelers switching their holiday plans to safer southern European destinations, such as Ibiza, up 39% to GBP115.


About Hotels.com

As part of Expedia Inc, which operates in all major markets, Hotels.com offers almost 149,000 hotels, B&Bs and serviced apartments worldwide. If a customer can find the same deal for less on a prepaid hotel, Hotels.com will match it. Hotels.com benefits from one of the largest hotel contracting teams in the industry negotiating the best rates for its customers, plus there are more than 3 million reviews from users who have actually stayed in the hotels to ensure customers make an informed choice when booking. Travelers can book online or by contacting one of the multilingual call centers.