Higher Global Hotel Prices for Fifth Year in a Row; Singapore Rates Down 9%

According to the latest Hotels.com Hotel Price Index (HPI), the average price paid for a hotel room around the world rose by 3% in 2014 when compared with 2013.

Hotel prices have now experienced five years of steady price rises since they plummeted during the financial collapse of 2008/9.

The global HPI stood at 113 at the end of 2014, 13 points higher than at its launch in 2004 and on a par with its 2008 level but still four points lower than its peak at 117 in 2007.

Johan Svanstrom, President of the Hotels.com brand, said, "Although the index rose again last year, it is still way behind its peak of seven years ago which is great news for consumers. Each year is unique in the travel industry and 2014 was no exception, bringing its own opportunities and challenges. Global events, such as the Winter Olympic Games and World Cup, predictably attracted travellers 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."

Of the six regions in the HPI, the index rose in four, was flat in one and fell in another. With a strong economy and rising Dollar, North America led the way with a rise of 5%, two percentage points better than its 2013 result.

Two regions reported 4% index growth. The Caribbean achieved a new record, rising to 137, the highest yearly regional Index figure ever reached. This was fuelled by a stronger US Dollar as the Caribbean remained a firm favourite for US travellers. Secondly, Europe and the Middle East showed its fastest rate of growth for seven years, as many countries reported record visitor numbers for the year.

Latin America registered a 2% Index rise. World Cup hosts Brazil exceeded expectations when it came to its hospitality industry and the event was a unique opportunity for the country to showcase some of the top class accommodation and services it has to offer.

The Pacific showed no growth in its index in 2014 but the continued weakness in the Australian dollar should mean that the region will attract more visitors in 2015.

For Asia, the index decreased 2%. Over the years, the HPI has shown that Asia has long offered the best value destinations in the world and continues to do so.

"More than 1.1 billion travellers ventured abroad in 2014, up nearly 5% over the previous year , with the size of the global domestic travel market estimated to be four to five times this total. Tourism is a fiercely competitive and resilient industry with countries vying to attract valuable visiting travellers by improving infrastructure, expanding hospitality and entertainment options and relaxing visa requirements. Travel opens up both world and minds - so go explore," added Svanstrom.

Singapore Hotel Prices Drop by 9%

Hotel prices in Singapore registered a 9% drop in average room rates paid by international travellers between 2013 and 2014.

Hotel prices in Singapore have experienced a steady decline since 2012. In 2014 alone, demand for hotel rooms fell, driven by geopolitical tensions and a series of aviation incidents.

Katherine Cole, Regional Director of the Hotels.com brand, said, “The popularity of Singapore as a stopover point makes it highly susceptible to any changes within the region. Demand for hotels here fell last year as travellers sought alternative destinations during the period of Thailand’s Martial Law, and also as the number of Chinese visitors to the country dropped. However, we expect to see increased demand for travel to Singapore in 2015, especially as the Chinese and Russian travel market continues to boom, and as the city-state gears up for its Golden Jubilee and the Southeast Asian Games this year.”

While Singapore has typically been deemed one of the more expensive cities in Asia, the continued fall in local hotel room rates signifies positive news for global travellers, as the country becomes an increasingly affordable destination.

A stronger Singapore Dollar also aided local travellers by lowering prices in 10 out of 15 Asian destinations. Average hotel prices in Indonesia took the biggest tumble, falling 9% from S$161 to S$146. This was followed by Sri Lanka, Malaysia and Singapore – all of which saw a 6% drop to S$214, S$131 and S$216, respectively.

In contrast, only five countries experienced price increases – Japan’s average hotel room rates went up by 5%, from S$178 to S$191, while Macau followed closely behind with a 5% rise from S$211 to S$221, and China up 3% from S$142 to S$146. Additionally, rates in the Philippines inched up slightly by 2% from S$159 to S$161; and despite a 1% increase in average hotel prices in Cambodia from S$ 107 to S$109, it was still the country where Singapore travellers paid the least.

“The latest findings reinforces Asia’s position as the leader of best value destinations worldwide for the third year running. This certainly aids in fuelling and catering to the rising demand for luxury- or-less travel,” said Cole. “Overall, more than 1.1 billion travellers ventured abroad in 2014, up nearly 5% over the previous year . Tourism is a fiercely competitive and resilient industry with countries vying to attract valuable inbound visitors by improving infrastructure, expanding hospitality and entertainment options, as well as relaxing visa requirements. We expect Asia to continue riding high on Singaporeans’ travel agenda, especially as traditionally hot destinations like Japan and Thailand regain travellers’ trust.”