Hotel prices have fallen by 12% globally during the last quarter of 2008

25/03/09 Acrobat (pdf, 52 KB)

According to the Hotel Price Index in Hotels.com,

The strengthening of the euro in recent months has allowed Spanish travelers to find much cheaper hotel rooms

Average hotel room prices* have fallen 12% globally over the past year, according to the latest edition of Hotels.com's Hotel Price Index (HPI). Between October and December 2008, prices were more than 10% below the corresponding average compared to the previous year, which placed the value of the rooms at only 1% above the price recorded by the first HPI published in January 2004.

This sharp general decrease in tariffs has been the result of the fall in prices that has arisen on all continents. However, the most resounding fall has been in North America with a spectacular decrease of 12% during the last quarter of 2008 compared to the same period of the previous year. On the other hand, European prices resist the decline a little better, although they registered a decrease of 10% during the same period. The Caribbean and Latin America show a drop of 7%, while Asia only reduced its rates by 2%.

The Hotels.com Index shows the actual values paid by consumers for a hotel room and is based on a sample of 68,000 hotels, located in 12,500 cities around the world. Specifically, this new edition of the Hotel Price Index analyzes the prices paid between October and December 2008 in relation to the same period in 2007.

The president of Hotels.com worldwide, David Roche, explains the data in the following terms: "Prices have fallen sharply globally during the last three months of last year due to the effort of entrepreneurs to maintain occupancy levels. If we take into account that last autumn the prices of hotels in North America were the only ones that fell, we are now witnessing a decline at a global level, being demonstrated, once again, the delicate economic situation that is directly affecting hotel prices in each and every one of the continents. It is clear that the data for North America (-12%) are much more dramatic, although the results concerning Europe, the Caribbean and Latin America should not be overlooked. But the good news for travelers is that we are in the moment of bargains and offers, and this 2009 will undoubtedly be the year of great opportunities."

A view from Spain: Average price paid per room in the main world destinations

For eurozone travelers, the currency has been the biggest advantage in the face of the global economic situation. And it is that the strength of the euro against other currencies has meant considerable savings for many tourists, who have come to pay even more advantageous prices than those who do not benefit from the euro.

In general terms, Spanish hotel prices have suffered a general decline, standing at 91 euros, which represents a decrease of 12 percent in the last three months of 2008, compared to the same period of the previous year. This fall places our country in fifth place in the ranking of European countries with the largest price drops. This demonstrates the tariff cut strategy that Spanish hoteliers have followed to maintain the occupancy rate in the current economic situation. Few Spanish cities have seen their rates grow significantly.

The only European country whose prices have increased during the last quarter of 2008, compared to 2007, has been Switzerland. The value of hotels was 7% above the previous year, mainly due to the strength of the Swiss franc against the euro.

The United Kingdom has been the European country whose prices have fallen most vertiginously, a spectacular 24% year-on-year. Several factors explain this figure, from the effect of the weakness of the pound sterling to the economic recession. As a consequence, the British country has never been so attractive to Spanish tourists.

Prices in the Scandinavian region, Norway and Sweden, also show a significant decrease, of 18% and 10% respectively. Another case of a weakening currency against the euro. As for the Eurozone, the country with the sharpest decline has been Ireland, where prices have fallen by 17% in the last quarter of 2008.

Average price paid by Spanish travellers for hotel rooms in major international destinations (Q4 2008)

Switzerland

Denmark

Norway

United Kingdom

Austria

Sweden

Italy

Holland

Belgium

Finland

Germany

France

Spain

Greece

Ireland

Poland

Hungary

Czech Republic

Portugal

And the Spanish vision regarding the average price of rooms in the main cities of the world

As for the large capitals and business centers of the Eurozone, prices have also been revised downwards. Leading the list is Dublin, which decreases its prices by 20% compared to the last quarter of 2007. In second place are the main Spanish cities, Madrid and Barcelona, both with a decrease of 14%, as a result of the effort of hoteliers to maintain the level of occupancy.

The main Italian cities recorded a reduction in their fares of 10% as did the capital Lusa.

Average price paid by Spanish travellers for hotel rooms in the main eurozone destinations (Q4 2008)

%Year-on-Year Change

Paris

Rome

Vienna

Amsterdam

Frankfurt

Barcelona

Milan

Brussels

Madrid

Munich

Lisbon

Dublin

Berlin

If we focus on the main cities of the world, two of the destinations that are traditionally among the favorites of Spanish travelers, London and New York, have also seen their rates reduced. London has suffered a decrease of 24% placing the average price at 123 euros and New York has cut its rates by 16% which means that the average price per room has fallen to 187 euros.

Average room price paid by Spanish travellers in the last quarter of 2008 (Q4 2008)

Moscow

Abu Dhabi

Dubai

New York

Geneva

Rio De Janeiro

Monte Carlo

Washington

Tokyo

Cancun

Zurich

Boston

Venice

Cairo

Copenhagen

Chicago

London

Edinburgh

Paris

Oslo

Hong Kong

Colony

Bucharest

Mumbai

Rome

Vienna

Amsterdam

Stockholm

Frankfurt

Barcelona

Milan

Gothenburg

Buenos Aires

Helsinki

Brussels

Marrakech

Rotterdam

Florence

Madrid

New Delhi

Munich

Cape Town

Montreal

Istanbul

Toronto

Warsaw

Sydney

Lisbon

Seville

Beijing

Dublin

Mexico City

Shanghai

Berlin

Vancouver

Krakow

Budapest

Pisa

Prague

Marseille

Kuala Lumpur

Bangkok

Las Vegas

Tallinn

Reykjavik

The destinations that have suffered the biggest price drop

The Indian cities Bombay and New Delhi have suffered the most notorious price decreases worldwide during the last three months of the year, compared to the same period in 2007, with 38 and 36 percent and with an average price per room of 113 euros and 100 euros, respectively. In addition to the position of the euro, these falls are also due to the impact of the terrorist attacks suffered, which have driven away tourists. In third place is Las Vegas, which has also been the only American city to be included in the list of the main cities with the most pronounced price falls, due to a year-on-year decline of 30%, which means that the average price stands at 71 euros. Among European destinations, Reykjavik and London have suffered the most substantial decline, falling by 27% and 24% in the last three months of 2008, respectively.

The destinations with the most pronounced price increases

Abu Dhabi has been the city that has had the greatest increase in prices, with a spectacular growth of 24%,placing the average price per room at 224 euros. This has placed it as the second most expensive city in the world, behind Moscow. The fact that this city has attracted certain types of tourists who opt for luxury trips, has contributed to this increase in rates. It is followed by Cairo, specifically with an increase of 18% year-on-year and placing the average price per room at 131 euros. Focusing on the European continent and positioning itself as the third city with the highest rise, it has been experienced by Bucharest, whose rates have grown by 18% placing the average price per room at 116 euros.

David Roche concludes: "Our report shows that hoteliers have been forced to reduce prices globally as a strategy to maintain occupancy. At the same time this has been an advantage for the travelers themselves, who if they have also been able to benefit from the strength of the euro, have found real bargains during the last months of last year and will be able to continue finding many more throughout this 2009. But for tourists not from the Eurozone it is also an especially good time to look for and find bargains. In addition, it should be noted that the last quarter of 2008 was the first in which hotels have reduced their rates since January 2004, the date of publication of the first HPI."

*The HPI tracks the actual prices paid per room in a wide selection of hotels representing all star categories from the major cities in which Hotels.com operates.

-End-

About HPI

The Hotel Price Index (HPI) of Hotels.com is a periodic report that collects the prices of the hotels of the main cities of the world. It is made based on own data of reservations through Hotels.com.

The international reach of Hotels.com (in terms of customers and destinations) makes this index one of the most complete references currently available in the tourism sector, thanks to the fact that it incorporates a wide range of hotels, both belonging to chains and independent, as well as specialized accommodation options such as apartments and "Bed & Breakfast" establishments.

In Europe, approximately 25% of hotel rooms belong to chains and the rest are independent. The opposite happens in the case of the United States, where approximately 70% of the rooms reserved belong to chains.

In addition to the figures themselves, the HPI includes information about new or unusual trends in bookings and prices.

About Hotels.com

Operating in major markets with a dedicated team, Hotels.com offers more than 80,000 quality hotels worldwide. Hotels.com has one of the largest expert hotel teams in the sector, it also includes user reviews that offer a first-hand analysis of the characteristics of the hotels. Customers can make their reservations directly online or by calling one of the multilingual Customer Service Centers by calling 902 02 61 13

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Authors: Hotels.com - Press Releases