Gadling

The average hotel room rate has begun to increase for the first time since 2007, shows the latest issue of Hotels.com’s biannual Hotel Price Index (HPI™). But the news isn’t all bad. Despite the 2% increase, hotel room rates are still markedly lower than rates at the peak of the market. As the 2009 HPI predicted, 2010 continues to be another great year for great travel values.

Las Vegas topped the list of top five most popular domestic destinations for the second time this year, with New York, Orlando, Chicago and San Francisco following close behind. Popular cities for international travelers include New York, Las Vegas, San Francisco, Orlando and Los Angeles.

“We’re seeing travel bookings pick up around the world,” said Victor Owens, Hotels.com’s vice president of marketing, North America. “There are, of course, still deals to be had, especially in international destinations like Abu Dhabi, Dubai and Reykjavik which each saw a major drop in hotel prices during the first half of 2010.”

In some cities, however, luxury hotels became a more attractive proposition, with average prices for top-end rooms dropping by over a tenth. Domestically, a 5-star hotel dropped 13 percent in Orlando ($259-$225) and San Francisco ($323-$280). Chicago’s rates have stayed steady with an average room rate of $137, making it ideal for business travelers and one of the best locations for meeting planners to book their next event.

The Big Apple was the most expensive domestic city of those tracked in the global list; but, U.S. and overseas travelers continued to flock to NYC. Prices averaged $224 per room per night during Q2 2010 – an increase of 14 percent compared to 2009. A Gradual return of business travel and an increase in domestic travel fuelled this rise.

The biggest loser is Abu Dhabi, which fell by 46 percent between Q2 2009 and Q2 2010. This means a hotel room that would have cost a U.S. traveler $304 during the first six months of 2009 cost a traveler just $163 this year – a drop of $141. This was fuelled by various factors, including a growth in the number of rooms, as new hotels opened, and a drop in the number of corporate travelers visiting the Emirate, due to the economic situation. This influential city of commerce was affected by the fall of international business travel, as was its larger neighbor, Dubai, which saw a 10% decrease in hotel room prices.

Cost rose most sharply in the second quarter of 2010 for locations that hosted major events or were the scene of major motion pictures. rices rose 60% in Cannes, France, 57% in Eat, Pray, Love location Bali and 53% in World Cup home base Cape Town, South Africa.

For detailed information on your home city or next travel destination, view the report online.

[Image courtesy of Hotels.com]