UK hoteliers slash room prices

Cost of hotel rooms in UK down by 16%

The average price of a UK hotel room was 16% lower in the first half of 2009, compared to the same period in 2008, according to the the latest Hotels.com Hotel Price Index. Britons paid on average £83 for a hotel room at home between January and June 2009, down from £99 a year before.

UK prices fell even further for US and European travellers, who had the benefit not only of the price cuts but also the weak Pound. American travellers enjoyed a fall of 28% in the average UK hotel price paying just $165 a night, while travellers from the Eurozone paid €101 for a night in a UK hotel, a drop of 22% year on year.

David Roche, President, Hotels.com Worldwide, says:

“These are by far the most significant movements in prices that we have seen since Hotels.com started the Hotel Price Index in 2004. Hotel prices have fallen across the UK, a reflection of just how deep hoteliers have had to dig in their efforts to maintain occupancy. We were expecting 2009 to be a year of dramatic price cuts, and so far it has been.”

The Hotels.com Hotel Price Index (HPI) tracks the real prices paid per hotel room (rather than advertised rates) for 78,000 hotels across 13,000 locations around the world. The latest HPI looks at prices from January to June 2009, compared to the same period in 2008.

In cities from Aberdeen to York, British hotels have had to lower rates by up to 33% in a bid to maintain occupancy levels and fill rooms.

While hoteliers in London cut prices less than those elsewhere in the country, prices were still down by 12% year-on-year in the capital. Southampton hoteliers cut prices to the greatest extent (33%), followed closely by hoteliers in Belfast who cut their prices by 29%. In fact there were prices fall in every major British city analysed by Hotels.com, with hoteliers in seven destinations cutting prices by one fifth (20%) or more.

David Roche continues: “Hotel room supply in London is rising fast ahead of the Olympics, with room numbers increasing by 6% in the last 18 months. This growth in supply, together with the economic downturn has meant hoteliers have had to cut their rates even further than they did at the end of last year.”

On average, hotel prices around the world fell by 17% in the first six months of the year compared to the previous year. The Hotel Price Index was down to 101 points in June 2009, almost down to the level of 100 points at which it was started in January 2004.

Hotel prices dropped across every major region, down by 18% in Latin America, by 17% in North America and Asia and by 16% in Europe. With the exception of the Caribbean (where prices fell a more modest 2% year-on-year), each market saw prices fall at their sharpest rate since 2004, when the HPI was started.

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