Will Hotel Pricing Strength Continue into 2024? (2024)

FAQs

Will hotel pricing strength continue into 2024? ›

We expect hotel prices to continue rising in 2024 due to 3 key reasons: Hotel prices haven't yet displayed any real pricing strength above inflation. Occupancy levels have not recovered yet to pre-Covid levels, with occupancy recovery aiding further RevPAR growth.

2024 U.S. Outlook

While early leaders coming out of the pandemic, such as economy and midscale hotels, reported slower growth, luxury hotels, which had been lagging, posted strong RevPAR growth of 4.6% year-over-year. CBRE expects another year of improved performance in 2024.

Not surprisingly, analysts say, the demise of short-term rentals has driven up demand for hotel rooms and has emboldened some hoteliers to increase prices. “It was expected,” said Jamie Lane, the chief economist at AirDNA.

The Hotels market in India is expected to witness a rise in revenue with a projected value of US$9.13bn by 2024. The market is expected to exhibit an impressive annual growth rate of 5.41% (CAGR 2024-2028), contributing to a market volume of US$11.27bn by 2028.

“It all comes down to supply and demand,” says Colleen Carswell, former hotel director of sales turned hotel solutions strategist. “Most of the time, you'll actually save much more by booking at the last minute.”

Inflation, Corporate Travel and Even Upcoming Elections Play a Role, Too. Ben-Ari also attributes rising prices to the uplift in corporate travel, inflation and even upcoming elections. “This is despite an expected softening of leisure travel demand forecasted by American Express Global Business Travel,” Ben-Ari said.

The 2024 RevPAR growth forecasted has been maintained. Forward booking levels are up through May with a pause in March for the Easter observance. Planning activity is growing in the pipeline, which will result in more robust supply growth in 2025 and beyond.

Artificial Intelligence is making its way into everyday life more than ever before, and it's transforming the hospitality sector as we know it. Smart hotels are embracing AI to automate a variety of processes, from ordering food and drinks to managing room bookings and guest services.

The LW Hospitality Advisors (LWHA) Q1 2024 Major U.S. Hotel Sales Survey includes 66 single asset sale transactions over $10 million, which totaled nearly $2.5 billion and included approximately 10,700 hotel rooms with an average sale price per room of $230,000.

CBRE anticipates continued growth in the U.S. hotel industry in 2024, with a 3% RevPAR increase driven by recovery in international travel and strong segments performance, amidst challenges of increasing operational costs and pressure on profit margins.

What is the hotel industry market forecast? ›

The Hotels market in the United States is anticipated to experience a rise in revenue, with a projection of reaching US$110.50bn by 2024.

Cloud-based Hotel PMS has a lot to offer. As technologies and hotel operations grow and diversify with evolving market conditions and changing guest expectations and behaviors, property management systems will become more mobile and sophisticated with guest satisfaction at the forefront of the chosen tool.

The research group IBISWorld predicts a rebound for the U.S. hotels and motels industry after the pandemic, with steady growth through 2025. In the longer term, employment for workers in the hospitality industry will vary by specialty.