Skyrocketing hotel prices: cost surge exceeds 50% since the pandemic
Get ready for a pricey holiday in Spain this summer! With tourist accommodation costs reaching new highs across the board, your wallet might take a hit when planning a getaway. Here's the lowdown on why Spanish vacations are becoming pricier than ever—and at record-breaking speeds!
Hotel prices soaring like never before have become the norm since the pandemic. These lodging giants, which account for over half of Spain's tourist offerings, have seen a staggering 50% price increase since spring 2021. To put things in perspective, apartment prices increased by a more modest 37%, rural houses by almost 30%, and even campsites by an 11% increase. All these types of accommodations have risen far above the general price index, which increased by 18.6% between May 2021 and May 2025.
Raul Hernandez, an Applied Economics professor and tourism specialist at the University of La Laguna, attributes this trend to the insatiable demand for travel and tourism. "Whatever prices we set, tourists keep coming," he says. And the appeal of Spain as a holiday destination is undeniable—with the climate, gastronomy, and diverse experiences attracting a massive influx of international travelers.
In 2024, Spain welcomed almost 94 million foreign tourists, a record-breaking number that's projected to grow yet again this year. Preliminary data shows an impressive 7.1% increase in travelers compared to last year, with over 25 million tourists already coming in just April.
Hotels, now more expensive than ever
Most travelers opt for hotels, which remain the most popular tourist accommodations in Spain. The April hotel price index this year broke records for the month, after experiencing a 6.8% increase compared to 2024. The cumulative increase since April 2021 is 56.8%.
Before the pandemic, hotel prices had dropped in the summer of 2020 due to travel restrictions and widespread establishment closures. Since then, prices have been steadily climbing—reaching record levels last summer. For Spanish consumers booking a hotel room, this translates into steep prices.
Unrelenting price surges in all seasons
Hotel room prices have increased throughout the year, with travelers spreading out more across the calendar. As a result, the average price of a hotel room in Spain has seen a sharp rise. In August 2021, the average room price was below 115 euros. Last summer, that figure climbed to 147 euros, and it's expected to surpass 150 euros this year, with the average tariff reaching an all-time high of 116.62 euros in April alone.
During the same period, hotel profits have also grown steadily. The Revenue per Available Room reached a historical high of 117.42 euros in August last year, representing a 51% increase compared to 2021. Experts attribute these trends to the fixed capacity of hotels and the increasing demand for travel.
Pricing out Spanish tourists
Despite hotels' efforts to cater to high-end clientele by offering better services and quality, the surge in prices is affecting even budget accommodations. The increase has been even more pronounced among lower-category establishments, with five-star hotels seeing a 51% price hike and one-star hotels observing an 80.5% increase since April 2021.
Whilst some experts believe that the hotel sector is aiming for clients with greater purchasing power, others like Pilar Talon, who directs the Revenue Management master's degree at URJC, point to the sector's increased professionalization as the primary factor. "There is more quality," she states, "which is good." However, with prices increasing across all categories of hotels, affordability is becoming a concern for many Spanish tourists.
Apartments and rural houses following suit
Extra-hotel accommodations, such as tourist apartments, rural houses, and campgrounds have also observed significant price increases since the pandemic. Apartments saw a 37.6% price increase in the last four years, while rural houses reached record highs in January this year and nearly matched last summer's level in April. Campground prices set a new record in August 2021 and have increased by 5% in the last year.
Although apartments provide over 600,000 tourist places (between 16% and 17% of the total), they have increased by 6% in the last twelve months and by 37.6% between April 2021 and April of this year. Rural houses and camps contribute another 5% to the total tourist places, costing 9.5% more than last year at this time and having increased by 29.1% in the last four years.
All in all, these trends are causing concerns for many Spanish tourists, who are increasingly seeking more affordable alternatives outside of Spain. In some cases, the high prices are causing domestic tourists to be displaced in favor of foreign tourists. However, experts attribute these changes to a variety of factors, including air connectivity, package deals, and seasonality.
Enrichment Data:
- Surging Demand for Travel and Tourism: Travel restrictions were lifted, resulting in a sharp rebound in global tourism. Spain, as a popular European destination, saw a rapid increase in international and domestic visitors, putting pressure on accommodation prices.
- Operational and Staffing Challenges: Establishments struggled to rehire and train staff. The high operational costs due to staffing issues were often passed on to consumers through higher room rates.
- Increased Costs of Goods and Services: Disruptions in global supply chains and inflation led to increased prices for essential goods and services.
- Investment in Safety and Health Measures: Hotels invested in new health and safety protocols to reassure travelers, leading to higher operational costs.
- Pent-up Demand and Revenge Travel: Many consumers had postponed travel during the pandemic, leading to a wave of "revenge travel." Tourists were willing to pay more for experiences and accommodations.
- Limited Housing Supply in Urban Tourist Hotspots: The conversion of short-term rental properties into long-term housing or other uses during the pandemic temporarily reduced the supply of tourist accommodation, creating a bottleneck when tourism recovered.
- Sector Investment and Upgrades: Some hotels used the pandemic as an opportunity to renovate or upgrade facilities, leading to higher room rates to cover investment costs.
- despite the rise in hotel prices, many tourists still opt for hotel accommodations due to the undeniable appeal of Spain's climate, gastronomy, and diverse experiences, leading to an average hotel room price surpassing 150 euros this year.
- the increase in prices has extended to other types of accommodations, with apartments, rural houses, and even camping sites showing a rise above the general price index, causing concerns for many Spanish tourists seeking more affordable alternatives.
