New Lincoln University research shows New Zealand hotel room rates are cheaper than international destinations including Los Angeles, Melbourne, Sydney and London.
The research was undertaken by Lincoln University senior lecturer in business and hotel management Dr Tony Brien, who studied room rates around the world from 2000 to 2017.
Dr Brien said the evidence refuted public commentary that New Zealand hotel room rates are comparatively internationally expensive.
“Increasing tourism demand, coupled with a lack of available hotel rooms has seen New Zealand hotel room rates increase significantly since 2000, but this was off a very low starting base.
“However, New Zealand hotel rooms are still cheaper than many international destinations.”
He said hotel room prices are set by what the market is prepared to pay.
“Cheap or discounted hotel room prices can have operational ramifications including not being able to appropriately maintain the hotel stock which impacts guest satisfaction.
“Further, this can devalue the whole New Zealand hotel industry and risks New Zealand’s international reputation as a quality destination.” Dr Brien said the building of new hotels, which will increase hotel room supply, did not mean hotel room rates would go down.
“Many of the new hotels are high star-rated international brands and as a consequence demand a higher room rate.
“In effect, this can enable existing hotel room rates to remain at their present levels, or arguably, hotel room rates have the capacity to increase further to ensure ongoing investment.”