In August 2019, before the pandemic, a night in a Lyme Regis holiday rental would typically have cost you about £150 a night. A bit pricey, even for the self-proclaimed “Pearl of Dorset”. By last summer that price had risen to £260 per night. The bill if you dared stay for a week? A sobering £1,820.
That’s according to AirDNA, which collates the price paid for accommodation listed on Airbnb and Vrbo. And it’s not just Dorset. A comparison of August 2019 and August 2021 finds that the average price of private holiday rental across the UK rose 41 per cent across that period.
Some commentators believed the 2021 prices were a one-off: extraordinary demand and extraordinary prices caused by international travel restrictions and people preferring private accommodation over hotels and B&Bs during the pandemic. The problem is prices that go up rarely come down.
February 2022 half-term price data shared with me by AirDNA makes for grim reading. The average price of a stay in St Ives is up 30 per cent, Brighton 36 per cent and Llandudno 48 per cent on 2019. Lyme Regis? A week there cost a budget-eviscerating £326 a night, on average.
Compare that to Lanzarote’s sunny Playa Blanca, a balmy 20C during the February half-term. Over the course of the pandemic prices there went up too, but it still had an average nightly rate of just £142 this half-term. That’s half the price of Lyme Regis and double the celsius.
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Are we being fleeced, then? It depends how you look at it. One private accommodation owner in Lyme Regis told me he is unrepentant. He put his prices up in 2021 and has kept them up. “I am charging what people are willing to pay,” he said. “I am already fully booked for the summer.” Whether that amounts to supply and demand or stand and deliver only you can decide.
It’s a similar story — but not the same story — with hotels and B&Bs. Abysmal trading conditions during the pandemic, with long stretches of either being closed or struggling to attract Covid-wary guests, meant room rates actually dropped. According to data from the comparison website Kayak, the average room rate for three and four-star accommodation in the UK last year was £102, down from £109 in 2019.
Nor are UK accommodation owners raking it in, for the most part. Research from STR, a global hospitality data and analytics company, found that the RevPAR for UK hotels — the amount they make in revenue from each room — was £45.75. That’s less than Greece (£59.62) and Italy (£48.05) and about the same as Malta (£44.37).
Scott McCabe, a professor of marketing at the University of Nottingham, suggests that UK accommodation operators face a combination of unique challenges over price. “In addition to taxes, UK hoteliers must contend with rising land and property prices and a worsening labour shortage, both of which are likely to drive high prices.”
More challenges are coming. Many of us, freshly jabbed, will return to hotels and B&Bs this summer, but inflation is putting huge pressure on owners’ costs. Helen Massey, who rents out 17 properties in Runswick Bay, North Yorkshire, told me: “My suppliers have increased their prices to cover their own increased outgoings. One cleaner put up prices by 40 per cent. I haven’t increased my rates but I am closely monitoring the situation.”
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David Weston, of the UK Bed and Breakfast Association, characterises it as a “perfect storm”. He said “costs of heating and electricity, food ingredients, cleaning products, insurance, laundry and linen have all increased not just marginally but very significantly.” Some owners will almost certainly be forced to charge more this summer.
Crucially, as with holiday rentals, hotels abroad are already cheaper than in the UK. While the UK’s average rate of £102 is comparable to Spain (£105), average rates in Portugal (£96), Turkey (£85) and Malta (£78) were all cheaper in 2021, according to Kayak. Those differences add up to hundreds of pounds on longer holidays.
Accommodation is not the only expense on a holiday but it is by far the most significant. Of course, you need only hop in a car or train in the UK rather than fly. There is no transfer minibus to pay for, or fees for roaming or travel money. But even when you do those sums the UK still adds up to being expensive.
With Tui, the price of a seven-night package holiday at the Protur Playa Cala Millor, Mallorca, for Easter is £348 per person. The hotel is no oil painting, but it has sea views, two pools and breakfast and dinner is included. Flights too. There were dozens of similar deals to different destinations. The very cheapest stay on booking.com in Lyme Regis for a week over Easter was £772.
Many of us want to holiday in the UK more. Increasingly, most of us can’t afford it.
@roryboland
