UK hotel room rates crash in Q3

Average hotel room rates in major UK cities including Cardiff, Edinburgh and Bristol have fallen by up to 20% in Q3 2016 when compared with Q3 2015 prices, according to latest data from global hotel solutions provider HRS. 

UK hotel rates are down 20%.
UK hotel rates are down 20%.

The figures, which are released quarterly, showed that all major cities across the UK have seen a drop in average room rates for this period.  Cardiff experienced the largest fall by 20% (£95), with Edinburgh dipping by 17% (£124) and Bristol prices dropping by 16% (£103).  Dropping by 15% in Q3 2016, Liverpool offered the cheapest average room rate in the UK at £84 per night.

Meanwhile, London retained its reputation as the most expensive place to stay in the UK with an average night’s stay at £153, but even the capital was hit by a rate drop of 14% in Q3 2016 compared to Q3 2015.

Talking about the findings, Andy Besent, MD of HRS (UK and Ireland), commented: “HRS data has revealed that hotel room rates appear to be falling in the UK; indeed our data shows that rates have dropped in the last two quarters across major cities in the UK compared with the same period in 2015.

“Last quarter’s findings showed that Q2 rates had fallen on average by 7%, but for Q3 rates have fallen even further by an average of nearly 14%. It’s too early to say whether or not this is due to the outcome of the Brexit vote, but we are watching to see if this pattern continues.  Whilst it’s no doubt concerning for the hotel industry, the fall in prices should at least make the UK a more attractive and cost effective destination for foreign business and leisure travellers in the months to come.”

Looking to Europe, the majority of key cities saw a steady rate rise in Q3 2016 against the same period in 2015. The impact of London’s room rates dropping by 14% to £153 per night meant that it dropped into second place with Zurich taking pole position as the most expensive place to stay with average rooms at £160.  In third place, Copenhagen was hot on London’s heels with average prices at £152.

Istanbul was the cheapest place to stay in Europe in Q3 2016, with room rates falling significantly by 28% down to £63 per night. Meanwhile, rates also fell in Milan by 13% to £101, Moscow by 10% to £75, Paris by 5% to £115, Brussels by 5% to £102 and Amsterdam by 4% to £117.

On a global scale North America became the most expensive region to stay in overall, with New York rates averaging £229 per night in Q3 2016, San Francisco at £222 and Chicago at £167.

Conversely, as with Q2 2016, some of South America’s major cities experienced significant falls in hotel room rates.  This included Sao Paulo and Rio de Janeiro which saw the most marked decrease with room rates falling by 21% and 23% respectively.  Mexico City also saw room rates slide by 15% down to £95. Only Buenos Aires saw a slight rise of 7% to an average of £105 per night.

For those seeking the most competitive room rates globally, Kuala Lumpur offered the cheapest average room rates per night in Q3 2016 at £59 and Bangkok had rooms averaging £63 per night.

Besent concluded: “Average room rates are generally holding strong in Europe and internationally, especially when comparing these figures against the UK’s performance.  Looking at average room rates for locations where acts of terrorism have taken place over the last year such as Paris and Brussels, the drops have been relatively marginal which shows resilience from these important business hubs.  The only exception is Istanbul which has certainly taken quite a knock.”

“However, we are keeping an eye on the impact that the threat of the Zika virus may be having on prices in South America in particular and will be monitoring to see if this is an emerging trend in the coming months across other locations where it may become more prevalent.  From media reports, we know that the threat of Zika may have deterred some people from going to Brazil for the Olympics and the Paralympics, so it could be that hoteliers chose to lower their rates during Q2 and Q3 2016 to try and make it more enticing.”

Top UK Destinations1-5 star Hotels

Average room rate for hotel stays in British cities. 
Comparison of average rates, based on non-cancelled bookings. Public and corporate bookings.
Period: 01.07.-30.09.2016 GBP rate correct as of 28.10.16

Top UK Destinations ∅ Room rate 1*-5*****      per night Q3 2016 Rate development compared to Q3 2015 in %
Birmingham £91 (101 €) -8.2 %
Bristol  £103 (115 €) -16.1 %
Cardiff £95 (106 €) -20.0 %
Dublin £123 (137 €) +12.3 %
Edinburgh £124 (138 €) -17.4 %
Leeds £101 (113 €) -8.8 %
Liverpool £84 (94 €) -15.3 %
London £153 (170 €) -14.1 %
Manchester £102 (114 €) -10.9 %

 

Top European Destinations 1-5 star Hotels

Average room rate for hotel stays in European cities. 
Comparison of average rates, based on non-cancelled bookings. Public and corporate bookings.
Period: 01.07.-30.09.2016 GBP rate correct as of 28.10.16

Top European Destinations ∅ Room rate 1*-5*****      per night Q3 2016 Rate development compared to Q3 2015 in %
Amsterdam              £117 (130 €) -4.4%
Barcelona              £112 (125 €) +3.3%
Berlin                £89 (99 €) +6.5%
Brussels              £102 (113 €) -5.0%
Budapest                £76 (84 €) +5.0%
Copenhagen             £152 (169 €) +7.6%
Helsinki             £117 (130 €) +11.1%
Istanbul                £63 (70 €) -27.8%
Lisbon              £92 (102 €) +3.0%
London             £153 (170 €) -14.1%
Madrid                £87 (97 € ) +10.2%
Milan             £101 (112 €) -12.5%
Moscow                £75 (83 €) -9.8%
Oslo             £142 (158 €) +32.8%
Paris             £115 (128 €) -5.2%
Prague                £69 (77 €) +10.0%
Rome             £93 (103 €) +4.0%
Stockholm             £130 (145 €) +8.2%
Warsaw                £66 (73 €) -1.4%
Vienna                £86 (96 €) +3.2%
Zurich              £160 (178 €) +0.0%

 

Top International Destinations 1-5 star Hotels

Average room rate for hotel stays in international cities. 
Comparison of average rates, based on non-cancelled bookings. Public and corporate bookings.
Period: 01.07.-30.09.2016 GBP rate correct as of 28.10.16

Top International Destinations ∅ Room rate 1*-5*****      per night Q3 2016 Rate development compared to Q3 2015 in %
Bangkok £63 (70 €) -9.1 %
Beijing £73 (81 €) -8.0 %
Buenos Aires £105 (117 €) +7.3 %
Cape Town £85 (95 €) +6.7 %
Chicago £167 (186 €) -4.6 %
Dubai £99 (110 €) -11.3 %
Hong Kong £142 (158 €) +0.6 %
Kuala Lumpur £59 (66 €) -7.0 %
Mexico City £95 (106 €) -15.2 %
Miami £113 (126 €) +11.5 %
Montreal £102 (114 €) -4.2 %
New York £229 (255 €) -3.8 %
Rio de Janeiro £102 (114 €) -23.0 %
San Francisco £222 (247 €) +1.2 %
São Paulo £79 (88 €) -21.4 %
Shanghai £76 (85 €) -6.6 %
Singapore £156 (174 €) +1.2 %
Sydney £147 (164 €) +0.0 %
Tokyo £164 (183 €) +7.0 %
Toronto £123 (137 €) +0.7 %

 

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