U.S. Leads the Charge as Hotel Prices Increase Globally for the Fifth Year in a Row
Jennifer Billock March 10, 2015
Hotels.com’s annual Hotel Price Index report shows hotel room rates increased around the globe in 2014, with the U.S. seeing the greatest boost.
Each year, Hotels.com publishes the Hotel Price Index, which details the rise or decline in global room rates. Although most of the world saw an increase in the average cost of a hotel room in 2014, according to the most recent report, North America was an over-achiever, achieving the highest regional increase rate of 5 percent.
Travelers visiting Nashville, Tenn., faced the largest year-over-year rate increase in the U.S. — 15 percent. During the same period, Las Vegas rates increased by 7 percent; Albuquerque, N.M., rates increased by 2 percent; and New York City rates increased by 1 percent.
Hotel rates are increasing around the world, not just in the U.S. In 2014, the global price rose by 3 percent overall. Asia and Pacific regions appeared to be the only two areas where hotel prices did not increase last year, with the Pacific remaining the same and Asia seeing an average decrease of 2 percent.
Although hotel prices are increasing year over year, the world is still catching up to peak prices from seven years ago, something which Hotels.com President Johan Svanstrom calls “great news for consumers.”
“Each year is unique in the travel industry and 2014 was no exception, bringing its own opportunities and challenges,” Svanstrom stated in the 2014 report. “Global events, such as the Winter Olympic Games and World Cup, predictably attracted travelers to new destinations. Yet unforeseen tragedies, including the Ebola outbreak, the missing Malaysian Airlines flight MH370 and the loss of MH17 left their own mark.”
[Photo: iStock]
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All these hotel prices statistics are just that: statistics. They can be caused by no increase in price at existing hotels, but new higher priced hotels opening in the same city. Or they can be caused by some hotel raising their prices for certain events which occurred more this year than in the previous year, but leaving the rates the same the rest of the year. Or it can be caused by high-end hotels raising their rates but budget hotels keeping their rates the same. So it's hard to actually get anything meaningful from these statistics, since there are so many different ways for an area-wide-average of hotel rates averaged over the whole year to change. The "average" consumer may pay "average" rates in some statistician's mind, but an actual particular consumer never pays the average rate of hotels in a given city. They pay the specific hotel rate for one hotel on a given stay date range. If they want to stay at a high-end hotel during a peak event, what matters is how rates at that hotel during that peak event have changed. If they want to stay at a budget hotel at a slow time, all the matters is how the rates at that budget hotel during slow times have changed.