Consumers hoping this summer’s sky-high hotel prices were a fluke should brace themselves: Hotel rates aren’t showing signs of getting much cheaper.
Seasonal patterns are back, which means it will cost less to book a hotel room in a leisure-focused destination this fall compared with the summer. But rates are higher than they were before the pandemic, as Americans have hit the road this summer and jammed many vacation spots.
Hotel executives say they expect demand for rooms to continue in the coming months as business and group travelers resume meetings and conferences this fall, which affects overall expected room rates.
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“Hotels don’t have to lower their [average daily rate] to try to attract business,” says Amanda Hite, president of hospitality and data analytics company STR. That is true even with a different mix of travelers in hotels, she says.
Analysts say that while prices are up compared with prior years, consumers need not despair completely. There are individual deals to be found, depending on the market.
STR forecasts the average daily rate to be $153.71 for the third quarter of this year and $146.49 for the fourth quarter.
Rates will vary by the type of customer and location, says C. Patrick Scholes, a lodging analyst for Truist Securities Inc. More American travelers are flocking to international destinations, especially Europe, which affects demand for beach and mountain resorts that were especially popular when there were restrictions on international travel, he says.
Based on search data from the travel site Kayak, domestic hotel prices for Sept. 5 through Oct. 2 are expected to be around $290 a night, which is on par with the average of $295 a night seen from Aug. 1 through Aug. 28. The search data tracked prices more than a month in advance of the check-in date. The company notes that prices drop about two weeks from the planned check-in date.
Some leisure-focused markets, including Atlantic City, N.J., and Virginia Beach, Va., have noticeable price declines from August to September, the company says.
But hotel prices will still be higher than in previous years, says John Zirkle Jr., president of the Virginia Beach Hotel Association. He says hotels have to cover increased costs for everything from staff members to soap and towels.