City records third largest drop in room rates after Moscow and Mumbai Global hotel prices drop 17%

A massive 40 per cent* drop in the price of hotel rooms makes Auckland the city with the third greatest decline in hotel prices globally after Moscow (52 per cent) and Mumbai (42 per cent), according to the latest Hotel Price Index' from Hotels.com® (http://www.hotels.com), the global hotel specialist.

The sharp drop in the city's hotel prices has been attributed to the lingering economic recession in New Zealand, during which consumers have become increasingly abstemious in their travel spend, and seeking good deals on accommodation. As a result, hoteliers in the city have dropped prices to encourage tourists as well as business travellers to the city, with the aim of maintaining occupancy rates, but at the expense of lower average daily rates.

While Auckland was the city with the greatest drop in hotel prices in Australasia, and indeed the Asia Pacific region, hotel prices in Sydney also fell significantly, down 30 per cent, and landing up in 17th position of cities experiencing the greatest fall. Hotels in the Asia Pacific region, which had been holding up better than those in the US or Europe, tumbled in the first half of 2009, dropping an average of 17 per cent compared to the same period one year earlier.

The Hotel Price Index, which looks at hotel prices for January to June 2009 compared to the same period the year before, revealed that hotel prices globally fell 17 per cent. Hotel prices are now on average lower than they were five years ago when the Hotel Price Index began, meaning consumers are now paying 2003 prices.

On average, prices in the Latin America region fell by the greatest extent, down 18 per cent in the first half of 2009 compared to the year before. Prices for hotel rooms in North America were down 17 per cent, with rates in Europe faring little better, dropping 16 per cent during the same period. Hotel rates in the Caribbean fell just two per cent in the first half of the year.

The good news for Kiwi travellers is that hotels in destinations once considered an indulgence for the budget-conscious are now also offering considerable savings. Hotel prices are down considerably in cities including New York (30 per cent), Geneva (28 per cent), Venice (20 per cent) and Paris (18 per cent). Closer to home, prices in Singapore are down 35 per cent, Beijing 32 per cent and Hong Kong by 22 per cent.

The staggering drop in hotel prices in Moscow is explained by a combination of the financial crisis taking its toll on the Russian centre and business travel falling dramatically. That said, Moscow hosted the Champions League Football final in May 2008, which would also have contributed to high prices last year. Prices for hotels in Mumbai continued to fall as terrorist attacks of November 2008 continued to deter tourists, while business travel to the city also dropped due to the economic downturn. Warsaw and Singapore finish the list of the five biggest falls in hotel prices which were down 38 per cent and 35 per cent respectively.

David Roche, President, Hotels.com Worldwide, comments: "We were expecting 2009 to be a year of dramatic price reductions across the world, and so far, it has been.

"This is by far the most significant movement in prices we've seen in the five years of publishing the Hotel Price Index."

Johan Svanstrom, Managing Director Hotels.com Asia Pacific, says: "The significant fall in hotel prices in two of Australasia's largest cities, Sydney and Auckland, once again makes this region attractive to international visitors as long-haul inbound travellers will see lower hotel rates helping to offset the perceived relative expense of getting there. There has of course also been a hotel price drop in local currency, helping travellers to find great deals domestically, both for leisure and for business purposes."

The Hotels.com Hotel Price Index tracks the real prices paid per hotel room rather than advertised rates. The HPI is based on prices actually paid by customers for 78,000 properties across 13,000 locations around the world. The international scale of Hotels.com (in terms of both customers and destinations) makes the Hotel Price Index one of the most comprehensive benchmarks available.