Jamie Gray is a business reporter for the NZ Herald

Tourist boom pushing up room rates

Index shows Auckland nightly cost up 9% and picks strong year ahead.

New Zealand enjoyed another record-breaking year for visitor numbers last year.
New Zealand enjoyed another record-breaking year for visitor numbers last year.

The booming tourism sector has helped drive Auckland's average hotel room rate to $197 per night, up 9 per cent on the previous year's, according new data.

Online accommodation website Hotel.com said its hotel price index showed the average price paid per night for a room by international holiday-makers increased by 2 per cent to $176 per night in 2016.

The rise comes on the back of another record-breaking year for tourism in New Zealand in 2016, with international visitors nearing numbers close to 3.5 million.

Auckland was the most popular destination for international travellers, followed by Queenstown, which saw year-on-year prices rise by 13 per cent to an average of $273 a night.

Christchurch and Wellington were the third and fourth most popular.

Picton reported the steepest fall in price of the top 20 destinations, dropping by 10 per cent to $140 per night in 2016.

Christchurch also declined in the price paid per night by visiting guests — most likely due to ongoing earthquake and rebuild issues — down 5 per cent, it said.

In Hamilton, the most affordable New Zealand destination among the top 20 analysed for international travellers, a hotel room cost on average $136 per night in 2016.

Hotels.com brand marketing manager, Australia and New Zealand, David Spasovic, said the rising value of the New Zealand dollar had not deterred tourists and he expected the trend to continue.

"The year ahead looks strong with increased air routes opening up New Zealand to more corners of the globe, and its role as co-host for major sporting events like the Rugby League World Cup and LPGA golf tour," he said.

In outbound tourism, Britain's vote last June to leave the European Union helped to reinforce London as a favourite destination for Kiwis.

After June, New Zealand travellers paid 15 per cent less to stay there in 2016, most likely because the British pound plummeted to its lowest level in more than 30 years and the kiwi dollar has been buying close to 53p — the best exchange rate in three years.

Australia and the United States were respectively the first- and second-most popular countries for Kiwi travellers in 2016, despite a majority of the destination cities rising in price.

Of the 13 least affordable cities reported in the Hotels.com data, 11 were in the United States, with Santa Monica making Kiwis feel the pinch at $486 on average per night, followed by Lahaina, in Hawaii, ($439), Boston ($368) and New York ($364).

The Turkish city of Istanbul, which was rocked by terror attacks and an attempted military coup in 2016, topped the list of European destinations sliding most in price with a fall of 27 per cent, where a room can set travellers back just $106 a night, Hotels.Com said.

New Zealanders also had more money in their back pockets in Zurich, where the average price paid for a room fell by 18 per cent to $287 per night, it said.

The Hotels.com report follows news over the weekend that Auckland hotel and motel owners are on a collision course with mayor Phil Goff over a targeted rate they say will cost hundreds of thousands of dollars a year.

Goff said accommodation providers had never had it so go good and they should pay for tourism promotion. His council would use the money it now spends on promotion to pay for infrastructure and spare residents more in rate rises.

The new rate could raise close to $28 million and is part of the city's annual budget which is due to be signed off around the middle of the year.

- NZ Herald

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