Hotel room rate increases in key global business destinations are slowing down, while booking lead times are widening, according to the latest data from accommodation booking specialist HotelHub.
According to the company's 2024 hotel data – which includes more than 8 million business travel bookings – the global average room rate for the year was $184 per night, up 4.6 per cent from $176 in 2023. However, like-for-like comparisons across each quarter show that the rate at which prices are increasing is tapering off.
Hotel rates in Q1 were up 7.9 per cent compared to the same period in 2023, but by Q4 a “significantly smaller” increase of 3.9 per cent was recorded versus the same period in 2023.
In London, for example, hotel rates were up 8.7 per cent in Q1 2024, compared to Q1 2023, but by Q4 this increase sat at 6.7 per cent, rising from $311 per night in Q4 2023 to $332 in Q4 2024. Meanwhile, New York, a notoriously expensive city, recorded price decreases in the second half of the year with rates in Q4 sitting at an average of $497 per night, down 2.2 per cent from an average of $508 in Q4 2023.
This tracks with 2025 pricing forecasts made in late 2024 by travel management companies Amex GBT and CWT, which predicted hotel rates would stabilise this year, with an expected 1.9 per cent growth rate.
Findings from HotelHub’s 2024 data also revealed that the average booking lead time for 2024 closed out at 16.1 days, up 9.9 per cent from 14.7 days in 2023. The biggest increase was for domestic bookings, which increased 11.5 per cent year-on-year to 14.4 days in 2024, and which the company attributed to more stringent travel-approval processes.
Commenting on the data, HotelHub’s director of business development, Paul Raymond, said: “Following some turbulent years, the corporate world appeared to take a deep breath in 2024, waiting to see what would happen next.
"Our latest findings suggest that while businesses are continuing to travel despite the uncertainty, they are putting greater emphasis on the need to control and maintain comprehensive visibility of their hotel expenditures.”
The average length of stay for business trips has changed little since 2022, sitting consistently at around 2.5 days, according to HotelHub’s data. Prior to the pandemic, this figure was about 3.5 days.