Hotel prices aren't dropping as usual for the fall season
There’s some price relief on hotel rooms now, but it won’t last long.
Hotel prices are averaging $185 per night in the U.S, down from $199 per night in mid-June, according to Travel booking app Hopper’s pricing forecast released last week, along with its airfare outlook. But rates are expected to increase in September and October to an average of $217 per night this fall, far above the 2021 fall average of $148 per night and a reversal of seasonal norms.
“Hotels typically follow a regular seasonal pattern where nightly rates would also drop in the fall, but we're not seeing that for this year,” Andrew Heritage, senior economist at Hopper, told Yahoo Money. “We are seeing higher rates than we have typically seen in the past.”
Still, travelers can find good deals on hotels depending on where they travel and which days they book.
Why prices will go up
One reason rates will head higher is that the operating costs in the hospitality industry have increased.
“The sector has had to pay more in wages to have people work for them,” Heritage said. “And demand for rooms is still very high because people want to travel.”
Nearly all hotels (97%) are experiencing staffing shortages, and half (49%) reported severe staffing shortages, according to a recent survey of 500 members conducted by the American Hotel & Lodging Association (AHLA). The most serious staffing need is housekeeping, with 58% ranking it as their biggest challenge. To meet the demand, nearly 90% of those surveyed have increased wages.
And it isn’t just room rates that are high this fall, Michael Bellisario, a Baird equity research senior analyst, told Yahoo Money. Leisure travelers need to consider the entire hotel bill.
“Every hotel owner for the public hotels that I cover are talking about raising spot prices as much as 15% to 20% in some cases for non-room items such as golf fees, menu items, parking, and resort fees,” Bellisario said.
Still, lofty rates haven’t deterred travelers. While soaring inflation prompted many consumers to trim back their spending in some areas, such as entertainment, more than 64% of Americans said they planned to travel for leisure this summer, according to a survey conducted by Hopper in July, with more than half planning to spend $1,000 or more.
Marriott International, the world’s largest hotel company, for instance, posted a 70% year-over-year increase in second-quarter revenue as people embraced traveling.
“While we are closely monitoring consumer and macroeconomic trends, we have yet to see signs of a slowdown in global lodging demand,” Marriott CEO Anthony Capuano said on a conference call. “On the contrary, the pent-up demand for all types of travel, the shift of spending towards experiences versus goods, sustained high levels of employment and the lifting of travel restrictions and opening borders in most markets around the world are fueling travel.”
Where the best hotel deals are
Las Vegas ($217 per night), New York ($338 per night), and Miami ($207 per night) are the top destinations travelers are searching for this fall, according to Hopper research. Other popular destinations: Honolulu ($282 per night), Los Angeles ($262 per night), and Orlando ($143 per night).
Sought-after international destinations are Cancun, Mexico ($227 per night), Bangkok, Thailand ($43 per night), and Cartagena, Colombia ($85 per night.)
Some of the top fall deals include La Jolla, Calif, now a $329 nightly rate, down from $723 this summer. In Myrtle Beach, S.C., the average fall nightly room rate is $135 versus $281 earlier this summer, and in Maui, Hawaii, nightly rates have slipped to $681 from $899. For international travelers, a nightly rate in Mykonos, Greece is $236 this fall down from $437 and a room in Ibiza, Spain is $179 a night down from $260.
One final tip: “With hotels, Saturday nights tend to be the most expensive nightly rate,” Heritage said. “So if you can avoid staying somewhere on a Saturday night that can help.”
Kerry is a Senior Columnist and Senior Reporter at Yahoo Money. Follow her on Twitter @kerryhannon
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