Hotel industry on recovery path, room tariff goes up: Report

The hotel tariff went up by 12% in the first six months of this year in the country amid rise in demand for hotel rooms from domestic travellers, the recent Hotel Price Index (HPI) report said.

According to the report which reviewed the hotel tariff globally, there are clear signs that the hotel industry is on the recovery path.

"In India, the overall rate rose 12% following a surge in demand from domestic travellers as overseas destinations became more expensive," the report said.

For the first time in five years, travellers paid more for their hotel rooms during the first six months of 2012, in all parts of the world and globally average hotel prices rose by 4% over the last year indicating the hotel industry is staging recovery, it said.

Launched in 2004, the HPI looks at prices that people actually paid for their hotel rooms around the world.

"The hotel industry bounced back in the first half of this year from a number of natural and political crises in 2011, and it is encouraging to see growth in the sector," Hotels.Com President David Roche said.

While initially it may not seem good news for consumers, hotel prices are still only around their 2005 level, representing great value for travellers when both wages and other prices have risen considerably, he added.

Following the turmoil of the Arab Spring in early 2011, confidence returned to much of the Middle East and North Africa and hotel prices rose accordingly.

Japanese began to travel again putting behind the turbulence of the earthquake, tsunami and nuclear disaster in March 2011 while there was significant increase in the number of Chinese international travellers that helped to drive rates higher, the report said.

In the US, increasing business travel coupled with higher consumer spending made hotels busier with less discounting.

In the Pacific, the resources boom in Australia meant that space was at a premium, especially in Western Australia with global business visitors vying with mining executives for rooms.

Although rates rose as a whole in Europe, the results showed a mixed picture.

In euro zone, prices dropped where falling consumer confidence and spending power led to lower occupancy in the major cities and holiday hot spots.

"The first six months of 2012 have proved a promising start for most hotels. However, the second half of the year, with increasingly mixed economic signals, will be interesting to watch," Roche said.