US hotels seem to be losing pricing control
Reduced pricing leverage in US hotels may suggest economic pressures on budget travelers, while globally, hotels are moving towards recovery normalization
According to the latest weekly performance data from CoStar, US hotel revenue per available room experienced a year-over-year decline for the second consecutive week, marking its largest drop this year at 3.5%. This decline was primarily driven by a 2.1% decrease in average daily rate compared to the same period in 2023.
Key takeaways
- Throughout the week, US hotel industry revenue per available room decreased, with the most significant drops occurring on Thursday (-5.8%) and Friday (-6.7%). Weekdays (Monday to Wednesday) saw a milder decline, with RevPAR down by 2.3%;
- Economy hotels were hit hardest, experiencing an 8% decrease in revenue compared to the previous year. However, hotels across all chain scales recorded declines;
- Outside of the U.S., global revenue per available room outside the US dropped by 0.4%, marking the first decline since early 2021. Following a period of substantial revenue growth, gains over the past four weeks have remained below 10%.
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