Hotel prices in key global business travel cities are now going up at a “more moderate rate” than in the previous two years, according to the latest data from accommodation booking specialist HotelHub.
The company said that average room rate in the second quarter of this year was $189 per night, which was a 3.6 per cent increase on the same period of 2023. But this increase was much lower than for the corresponding period of 2023 when there was a 9.6 per cent year-on-year rise in the average room price.
In Europe, the average nightly rate booked was $176 during Q2, while North America had the highest regional rate at $218 per night.
“Rates in many major centres of commerce remain much higher than the worldwide average but, on the whole, the year-on-year increases noted in previous periods are also shrinking,” said HotelHub in its report, which is based on the analysis of two million hotel bookings made through its platform during Q2.
Average hotel rate booked in New York was up by 5 per cent year-on-year to $432 per night during the quarter, but this was down from an increase of 12 per cent in the first three months of 2024.
In London, average room rate was $330 in the second quarter, which was a 7.5 per cent year-on-year increase in price from a year ago.
Meanwhile, cities such as Stockholm, Chicago and Paris only saw “negligible changes” in their average room rates in Q2 compared with the same period of 2023. However, this was not a uniform picture with Madrid seeing a year-on-year increase of more than 20 per cent.
HotelHub added that it had seen a 7 per cent year-on-year rise in booking volumes during the second quarter, which suggested that “the financial and geopolitical climate is not dissuading corporates from travelling for business”.
Paul Raymond, director of business development at HotelHub, said: “It is encouraging to see signs of a slowing in rate growth trajectory; however, these are still uncertain times for the global economy and, with the US election looming, it may be some time before we know whether this will be a continuing trend.”
Travellers booking earlier
Other trends identified by HotelHub include business travellers making their accommodation bookings earlier than they did in 2023.
On average, travellers made their hotel bookings 16.7 days prior to check-in during Q2, which was 19 per cent higher than the average of 14 days in the second quarter of last year.
Domestic bookings were made an average of 15 days ahead of arrival (up from 12.2 days in 2023), while international bookings had an average lead-in time of nearly 20.75 days, an increase from 18.75 days last year.
HotelHub also found that the average length of hotel stay has “changed little” in the post-Covid years: it has continued to average around 2.5 days since 2022, with international trips consistently averaging just above three days in each of the past three years.
“With widespread hybrid working models, planning trips to coincide with days in the office is a clear consideration for businesses,” added the report.
Just over two-thirds (69 per cent) of all HotelHub’s bookings were for domestic hotel stays, although this figure was slightly lower in Europe at 62 per cent.
European cities largely dominated the list of the most booked cities for HotelHub, accounting for eight of the top 10 destinations during the quarter, headed by London in first place, followed by New York, Paris, Stockholm and Rome.