The latest data from hotel analyst STR has revealed a steady acceleration in global hotel prices this summer, primarily driven by high rates in Europe.
According to data, the average daily rate (ADR) for accommodations worldwide showed an increase of 6.3 per cent in July, compared to the same month in 2022, SchengenVisaInfo.com reports.
At the same time, European prices also saw even more growth year-on-year, thus increasing by 13.4 per cent in July 2023.
As the STR explains, a travel management company, CWT, has forecasted that there will be more moderate increases in hotel prices during the coming year.
During July of this year, the investment firm Jefferies, promoted by France, also noted a significant price increase. France’s average daily rate rose 87 per cent over pre-Covid levels. In addition, prices in the country witnessed a 36 per cent increase compared to July 2022 figures.
As of last month, ADR for hotels across Europe showed a 47 per cent increase compared to July 2019.
Based on STR data, the countries that recorded the most significant growth are the following:
- Italy – 51 per cent
- United Kingdom – 31 per cent
- Spain – 30 per cent
- Germany – 18 per cent
However, year-on-year ADR growth was more restrained from July to 2023, with the UK and Spain showing growth of six per cent and Germany showing an even lower growth rate of just three per cent.
Moreover, Jefferies said that Europe has managed to get the status as the most recovered hotel sector compared to other regions. On the other hand, European occupancy rates remain consistently below pre-COVID levels, as July 2023 occupancy was still 3.9 percentage points lower than July 2019 and saw a mere 0.7 point improvement from July 2022.
The same authority said that the global hotel occupancy rates have reached a point of stabilisation, with occupancy levels plateauing at a range of two to three percentage points below the figures recorded in 2019.
Regarding revenue per available room (RevPAR), STR data revealed that the Asia Pacific region demonstrated the strongest year-on-year growth, totalling 36 per cent in July. Meanwhile, the Americas showed the smallest growth compared to 2022, with a modest increase of one per cent in July last year.
In September last year, a report released by American Express Global Business Travel showed that hotel prices were expected to increase this year, with a particular focus on European cities expected to experience the most substantial increases.
Based on this report, the destinations that have seen a significant increase in prices are Paris, Stockholm and Dublin, with ten per cent, nine per cent and 8.5 per cent, respectively.