As the hospitality industry recovers from the pandemic, the average cost of a hotel room is skyrocketing in almost every country.
In most hotels around the world, current room rates are already above pre-pandemic levels in 2019 and appear to be rising faster than inflation.
In the UK, for example, the average cost of a hotel room today is 105.27 euros per night. This is 11.45 euros more than in May 2019. The increase was over 12 percent at 77.4 percent utilization.
Irish hotels have risen in price even more – by 21.4 percent from 136.71 euros in May 2019 to 165.97 euros this month.
Hotel rates also rose sharply in Portugal, Spain, and Italy, by 15, 17, and 23 percent respectively.
The reason for the price increase is obvious: pent-up demand for travel after two years of lockdown and restrictions. “The pandemic has led to a serious decline in demand for hospitality services. But now many hotels have reopened to international tourists and business travelers and are raising rates in response to the fact that they had a period of downtime.” In other words, hotels are raising prices in an attempt to recover the money they lost during the pandemic, and the situation can be assessed as quite a market one.
The highest occupancy rates were recorded in hotels in Ireland – 84.9 percent, the UK – 77.4 and Italy – 72.9 percent.
Over the next nine to twelve months, experts predict that pent-up demand will continue to drive the hospitality industry faster than we currently expect. Typically, pricing models are built based on rising prices for energy, food, and labor – these costs hotels are forced to pass on to consumers. But in 2022, a new, non-standard situation arose.
However, there are countries where hotel prices are not rising. France remains the most expensive country in terms of hotel bookings at €197.67 per night, its average daily rate actually down 14.9 percent since 2019. The situation is similar in Denmark and Sweden.