Global hotel rates: Q1 2026 Market Outlook

Key takeaways

1. Global hotel room rates are higher year over year in Q1 2026, but growth is uneven – Hotel prices are broadly up versus Q1 2025 across most regions, though the scale and consistency of that growth varies sharply by market.

2. Higher rates are increasingly concentrated on peak dates – In many destinations, elevated hotel prices are confined to short event-driven or holiday periods, with softer pricing across surrounding dates limiting quarter-wide gains.

3. Luxury hotels show the most consistent pricing strength – Five-star hotels outperform other segments in most regions, often exceeding both 2025 and, in some cases, 2024 pricing levels.

Q1 2026 hotel room rates are broadly higher year-over-year (YoY), yet the pace and pattern of this growth diverge sharply across regions. 

In some markets, elevated pricing holds across large portions of the quarter. In others, it compresses into narrow windows,  with brief peaks surrounded by softer baselines.

Two global patterns ring true throughout Lighthouse’s hotel room price data:

1) Luxury leads the way

Five-star hotels show the most consistent pricing strength, frequently exceeding both 2025 and 2024 levels.

Mid-market and value segments are more mixed – often up year-over-year but not yet back to earlier peaks, particularly in high-supply markets with uneven demand.

2) Pricing power is concentrating around peak demand

In mature urban destinations, higher rates cluster around specific events or holidays, with limited ability to hold those levels beyond peak dates.

Leisure-led destinations with constrained inventory are more likely to sustain elevated pricing across wider stretches of the quarter.

The sections that follow examine how these patterns play out at a regional level, highlighting where pricing gains are sustained, where they are compressed, and which segments are driving overall performance.

Africa

Q1 2026 hotel room rates for Africa average $175.41, a 16% increase from $150.84 a year ago. This uplift centers primarily on North Africa and Egypt's resort coast, with luxury hotels leading the growth and the strongest gains concentrated in January.

Africa: hotel pricing by tier

• 5-star: $344.47 (vs. $296.34 in 2025). January is $10–$20 higher than February and March.

• 4-star: $155.22 (vs. $136.62 in 2025). Flat across the quarter.

• 3-star: $97.51 (vs. $75.63 in 2025, above 2024's $87.68).

Hotel prices in key African cities

• Rabat +94%

• Cairo +75%

• Sharm El Sheikh +70%

• Casablanca +50%

• Durban +47%

• Nairobi -15%

• Addis Ababa -4%

Hotel pricing drivers in Africa

Morocco's Q1 strength overlapped with AFCON. Rabat hit $364.95 on the night of the final, surpassing any single-night rate recorded in the city in Q1 2025.

The pricing gains weren't confined to match days,as Casablanca rose 50% YoY for the quarter, and rates across Moroccan cities stayed elevated through mid-January before easing back.

Egypt's winter-sun season has lifted the resort coast. Sharm El Sheikh hotel prices are up 70% YoY, as are Hurghada (41%) and Cairo (75%). The pattern holds across the quarter, with European leisure traffic filling shoulder periods that haven’t performed as well in the past.

Cape Town’s hotel rates have also jumped 27% YoY (from $224.62 to $285.76). Data indicates that February will be the primary driver. Rates are projecting a rise from $255 in 2025 to $350 in 2026, reflecting the stronger demand anticipated during the city's peak summer month.

The island luxury markets are also holding firm through the quarter. Mauritius averages $377 per night (+23%), Seychelles $552 (+13%). Both show sustained pricing through the season without the added uplift seen in event-driven markets.

Asia

Q1 2026 hotel room rates are tracking at $103.18, up 7% from $96.12 in Q1 2025, but still below 2024's $119.42. Asia’s luxury sector is tracking above 2024 pricing levels, while mid-market and budget hotel tiers remain on a par with 2024 rates, though above 2025's.

Asia: hotel pricing by tier

• 5-star: $207.07 (vs. $195.93 in 2025, $197.42 in 2024).

• 4-star: $101.12 (vs. $93.18 in 2025, $99.82 in 2024).

• 3-star: $67.70 (vs. $61.26 in 2025, $68.46 in 2024).

Hotel prices in key Asian cities

Vietnam sees the strongest growth:

• Phu Quoc +306% YoY ($114.68 → $465.09)

• Da Nang +111% YoY ($51.55 → $108.51)

• Ho Chi Minh City +60% YoY ($93.18 → $148.69)

Thai resort markets up sharply:

• Phuket +42% YoY ($220.53 → $313.98)

• Koh Samui +38% YoY ($284.96 → $392.93)

Indonesia sees growth from a low base:

• Lombok +72% YoY ($58.55 → $100.70)

• Batam +33% YoY ($45.02 → $59.96)

Chinese holiday spike, but a weak baseline:

• Sanya: Peaks at $495.08

• Beijing: Peaks at $138.04

• Shanghai: Peaks at $126.02

India sustained domestic demand:

• Udaipur +37% YoY ($142.66 → $195.13)

• Jaipur +30% YoY ($144.07 → $187.45)

• Cochin +34% YoY ($92.15 → $123.53)

• Goa +20% YoY ($116.44 → $140.01)

• New Delhi +22% YoY ($88.45 → $108.23)

• Chennai +5% YoY ($90.37 → $94.74)

• Hyderabad +3% YoY ($88.65 → $91.19)

Hotel pricing drivers in Asia

Vietnam is posting the sharpest room price gains in the region. Phu Quoc's 306% jump reflects limited supply meeting growing international demand, with operators pushing rates aggressively during peak periods. 

The pattern extends beyond island resorts, as Da Nang and Ho Chi Minh City are both running double-digit growth, signaling broader pricing confidence across the country.

Thailand and Indonesia are showing strong resort growth. Phuket and Koh Samui are up 42% and 38% respectively and Lombok and Batam are both climbing sharply, but Indonesia’s gains are coming for a much lower 2025 base.

Japan's hotel room pricing closely follows event calendars. Sapporo spikes around the Snow Festival in early February, while Tokyo, Kyoto, Osaka, and Yokohama are all ramping up into late March as cherry blossom season approaches. 

The quarter's average rate is pulled up by a brief, powerful surge at the end, confining the actual pricing strength to a few dates.

China's quarter is dominated by Chinese New Year. Sanya saw the most extreme swing, which moved from around $165–170 in late January to $495 on February 19, then back below $300 within days. 

As expected, business hubs like Beijing and Shanghai showed only modest holiday lifts,  with $138 and $126, respectively. Outside that mid-February window, pricing power remains weak. Beijing, Shanghai, and Shenzhen are all running 8–16% below 2025 for the rest of the quarter.

India is the outlier with steady growth across most destinations, driven by sustained domestic demand rather than event spikes. Leisure and heritage markets are tracking 20–37% ahead, led by Udaipur, Jaipur, Cochin, and Goa. 

Urban centers are posting more moderate gains, with New Delhi up 22% and Chennai and Hyderabad both in low single digits. Jaipur is showing late momentum, with rates for early March climbing another 34% in the last two weeks as Holi approaches.

Europe

Q1 2026 hotel room rates are higher than Q1 2025 across most European destinations, but performance varies sharply by market type. Several cities are posting double-digit growth, while others remain flat or materially down.

Europe: hotel pricing by tier

• 5-star: $359.01 (vs. $311.25 in 2025, $316.66 in 2024). Renewed pricing power in luxury after a softer 2025.

• 4-star: $174.06 (vs. $156.53 in 2025, $150.08 in 2024). Steady, multi-year progression.

• 3-star: $126.05 (vs. $111.09 in 2025, $110.08 in 2024). Pricing strength extending into midscale.

Hotel prices in key European cities

Central and Eastern Europe show sustained growth:

• Prague +42% YoY ($112.75 → $160.53)

• Budapest +35% YoY ($117.31 → $158.39)

• Bratislava +26% YoY ($112.36 → $141.09)

• Gdansk +27% YoY ($82.15 → $103.88)

• Krakow +20% YoY ($100.58 → $120.93)

Winter leisure destinations are strong, but uneven:

• Zermatt +29% YoY ($638.92 → $822.04). Highest-priced market in the dataset.

• Andorra +38% YoY ($170.31 → $234.88)

• Salzburg +30% YoY ($149.59 → $194.54)

• Innsbruck and surrounding resorts +26% YoY ($184.27 → $232.96)

• Kufstein +22% YoY ($273.21 → $331.93)

Major Western European cities are mixed or negative:

• Barcelona -18% ($207.92 → $170.66).

• Berlin -9% ($134.13 → $122.24).

• Milan -6% ($246.75 → $232.28).

• London -2% ($255.57 → $249.89)

• Dublin -5% ($176.14 → $167.28)

• Madrid -1% ($211.05 → $209.45)

• Paris +7% ($199.92 → $213.80).

Hotel pricing drivers in Europe:

Central and Eastern Europe is showing the most consistent room price strength. Prague, Budapest, and Bratislava are all running 20–42% ahead of last year, with elevated pricing visible across most of the quarter, not just on event days or weekends. 

The pattern suggests sustained demand rather than temporary spikes.

Winter leisure destinations are holding firm. Zermatt remains the region's most expensive market at over $800 per night, while Alpine resorts across Austria and Switzerland are all running 20–30% ahead. Andorra's 38% jump reflects similar dynamics: strong demand meeting limited inventory during peak ski season.

Major Western European cities are more fragmented. Barcelona, Berlin, and Milan are all running negative for the quarter despite sharp event-driven spikes. 

Mobile World Congress in Barcelona (early March), Berlinale in Berlin (mid-February), and the Milano–Cortina Winter Olympics (Feb 6–22) are all creating brief rate surges, but the surrounding shoulder periods are soft enough to pull quarterly YoY averages down. 

London, Madrid, and Dublin are flat to down in the low single digits. Paris is up 7%, though the gain comes more from day-to-day variability than sustained momentum.

Latin America

Q1 2026 room rates in Latin America are tracking at $153.09, up 7.7% from $142.11 in Q1 2025, but still below 2024's $163.54. Pricing, while up year-over-year, hasn't yet returned to the levels seen two years ago.

Latam: hotel pricing by tier

• 5-star: $338.95 (vs. $319.84 in 2025, $336.41 in 2024). Luxury hotel room pricing has stabilized rather than accelerated.

• 4-star: $151.01 (vs. $135.77 in 2025, $137.27 in 2024). Strongest improvement, signaling renewed confidence in upper-midscale.

• 3-star: $84.83 (vs. $76.50 in 2025, $78.50 in 2024). Modest gain, continued price sensitivity in the value segment.

Hotel prices in key Latam cities

Brazil becomes a leisure-led growth engine:

• Gramado +115% ($90.23 → $193.51)

• Porto Seguro +74%

• Foz do Iguaçu +66%

• Maceió +65%

• Fortaleza +61%

• Natal +60%

• Rio de Janeiro +2%

• São Paulo -3%

• Belo Horizonte +2%

Mexico sees elevated base, measured growth:

• Tulum +43%

• Riviera Maya +29%

• Los Cabos +11%

• Cancún +9%

• Guadalajara +16%

• Mexico City +8%

• Monterrey +3%

Caribbean is the weakest pocket:

• Jamaica -30%

• Punta Cana -19%

• San Juan -14%.

Hotel pricing drivers in Latam

Brazil is the region's clear growth engine for hotel room prices. Domestic leisure destinations pricing 60–115% ahead of last year, led by Gramado's 115% jump. 

The pattern extends across beach markets, nature tourism, and experience-led destinations – Porto Seguro, Foz do Iguaçu, Maceió, Fortaleza, and Natal are all up more than 60%. 

Meanwhile, major cities like Rio, São Paulo, and Belo Horizonte are barely moving, highlighting a sharp split between leisure and urban demand.

Within Brazil, most of the pricing gains come early in the quarter and around key leisure periods. Outside those dates, rates tend to ease rather than hold at peak levels.

This means the quarter’s growth is coming from a handful of very busy periods, not from consistently higher prices across Q1.

Mexico’s pricing growth is more restrained this quarter. While Tulum and Riviera Maya are up 43% and 29%, Cancún and Los Cabos show smaller increases of 9–11%, indicating less room to push rates in mature resort markets.

Urban markets like Mexico City and Guadalajara are only slightly up year over year, pointing to more stable pricing rather than aggressive increases. Rates peak around New Year, then ease gradually through the rest of Q1.

Jamaica, Punta Cana, and San Juan are down 14–30%, making the Caribbean the weakest part of the region, with pricing soft across most of Q1.

This stands in sharp contrast to Brazil's surge and suggests demand challenges even during the Caribbean's traditional peak season.

Middle East

Q1 2026 room rates in the Middle East averaged $156.60, up 15% from $136.09 in 2025 and slightly ahead of 2024’s $150.74. 

While the region has recovered from a softer 2025, growth remains modest compared to two years ago, with pricing power concentrated in the luxury tier and specific event windows in the Gulf.

Middle East: hotel pricing by tier

• 5-star: $275.58 (vs. $232.81 in 2025). This segment saw the largest absolute gains in the region.

• 4-star: $135.54 (vs. $121.22 in 2025). Steady but trailing 3-star growth.

• 3-star: $107.62 (vs. $90.38 in 2025). Closing the gap with the 4-star tier.

Hotel prices in key Middle East cities

• Bodrum: +34%

• Istanbul: +26%

• Dubai: +21% ($186.93 → $225.96)

• Abu Dhabi: +21% ($253.62 → $306.69)

• Antalya: +16%

• Makkah: -32% ($300.61 → $203.65)

• Madinah: -20% ($379.44 → $303.09)

• Riyadh: -8% ($244.17 → $225.47)

Hotel pricing drivers in the Middle East

Turkey is delivering the region's most consistent leisure-led growth. Unlike other markets dependent on isolated spikes, Bodrum, Istanbul, and Antalya are seeing sustained international demand across the quarter. 

Istanbul’s 26% rise reflects a healthy mix of city-break and transit traffic, while the resort markets show pricing confidence well ahead of the traditional summer peak.

Saudi Arabia shows highly concentrated pricing around religious demand windows rather than sustained quarter-wide strength. In Makkah, rates peak sharply during pilgrimage periods, reaching $619.70 on March 10, before dropping back quickly. 

Outside these windows, pricing remains materially lower, which pulls down the overall quarter, despite extreme peak nights. 

Madinah follows a similar pattern, with brief periods of elevated pricing offset by weaker baselines through much of the quarter.

The core Gulf markets of Dubai and Abu Dhabi opened the quarter with elevated highs (exceeding $350) before normalizing through February. 

During March, rates hold within a defined band before firming again toward the end of the month, particularly in Abu Dhabi.

Qatar’s performance is more fractured and event-dependent. Doha showed early strength in January and a secondary peak of $259 in early February, but lacks the mid-quarter momentum seen in the UAE. 

For much of late February and March, rates have retreated to a narrow band around $130, signaling a return to a lower baseline once specific event drivers conclude.

North America

Q1 2026 advertised hotel rates are broadly flat, with the regional average of $128.90 sitting just 0.6% below 2025 levels and effectively unchanged from 2024. Higher prices are increasingly concentrated into short, predictable event windows and lower baselines holding across surrounding periods.

North America: hotel pricing by tier

• 5-star: $480.28 (vs. $502.46 in 2025, $479.73 in 2024). Down 4.4% year-over-year, the largest decline at the top of the market.

• 4-star: $202.27 (vs. $210.91 in 2025, $208.05 in 2024). Down 4.1%.

• 3-star: $121.69 (vs. $122.58 in 2025, $121.40 in 2024). Down 0.7%, the smallest decline.

Hotel prices in key North American cities

• San Francisco +20% ($194.68 → $234.19).

• Curaçao +17%

• Boston -28%

• Phoenix -32%

• New Orleans -31%

• Las Vegas -20%

• San Diego -19%

• Chicago -16%

• Los Angeles -11%

• New York -5%

Hotel pricing drivers in North America

Most large urban and leisure markets are entering Q1 2026 with advertised rates below their 2025 realized averages.

North America is no longer delivering sustained room rate growth. Every hotel class is running lower than Q1 2025, with the luxury sector down 4.4%,  the steepest decline of all star classes.

San Francisco is the clear outlier at +20%, anchored by two major events: the J.P. Morgan Healthcare Conference in mid-January and Super Bowl LX in early February. These both drive rates into the $400–$500 range.

The rest of the region is positioned lower. Phoenix, New Orleans, and Boston are all down 28–32%. Las Vegas is down 20%, San Diego 19%, Chicago 16%, Los Angeles 11%, and New York 5%.

It appears that hotels are still willing to push rates aggressively, but only during limited, high-confidence windows. New Orleans peaks at $670 on the night before Mardi Gras, then drops to the mid-$100s within days. 

Washington, DC ramps hard into the Cherry Blossom Festival opening weekend (late March), but earlier weeks in January and February are priced substantially lower. San Francisco surges twice but reverts to the mid-$100s between events.

Spring Break pricing is compressed. Miami Beach, San Diego, Palm Springs, and St. Pete Beach still hit $400–$500 on peak dates, but those peaks aren't extending across surrounding weeks the way they did in 2025.

In high-supply markets, pricing is cautious. New York is down 5% despite frequent $300+ nights – hotels aren't holding those levels across enough dates to lift the quarter. 

As noted earlier, Los Angeles is down 11%, with rates mostly in the $190–$235 range and fewer extreme peaks. Las Vegas is down 20% and shows the sharpest pullback, despite occasional $300 spikes.

Oceania

Q1 2026 average hotel rates are $177.77, up 8.8% from $163.38 in Q1 2025, though still slightly below 2024’s $179.49. The gains vary by market and tend to cluster around specific periods rather than holding consistently across the region.

Oceania: hotel pricing by tier

• 5-star: $239.24 (vs. $208.71 in 2025). The strongest growth tier, exceeding both 2025 and 2024 levels.

• 4-star: $158.91 (vs. $148.26 in 2025). Tracking in line with 2024 peaks but not exceeding them.

• 3-star: $135.72 (vs. $115.56 in 2025). A healthy jump in the baseline price for the value segment.

Hotel prices in key Oceania cities

• Gold Coast: +47% ($204.28→ $300.02)

• Fiji: +32% ($193.54 → $255.50)

• Queenstown: +32% ($288.03 → $380.03)

• Hobart: +29% ($184.42 → $237.20)

• French Polynesia: +21% ($533.15 → $647.25)

• Melbourne: -22% ($180.25 → $140.59)

• Wellington: -15% ($122.73 → $104.77)

• Brisbane: -9% ($179.80 → $164.30)

• Christchurch: -6% ($162.77 → $153.29)

Hotel pricing drivers in Oceania

Leisure destinations are leading the region's room price growth, though the pattern is uneven. Gold Coast, Fiji, Queenstown, and Hobart are all running 29–47% ahead of last year, but daily pricing reveals that much of this comes from peak-period concentration rather than sustained quarter-wide strength. 

Rates tend to lift on specific dates, particularly around holidays, events, and weekends, before easing on surrounding days. Cairns is an exception, showing steadier pricing across the quarter with smaller day-to-day swings

French Polynesia remains the region's most expensive market, averaging $647 per night, up 21% year-over-year.

Major cities are more fragmented.

Melbourne is down 22% for the quarter, despite extreme early-March spikes above $600. Most of January and February are priced well below 2025 levels.

Wellington, Brisbane, and Christchurch are all down 6–15%, with intermittent price increases failing to offset broader softness. Sydney is up 13%, but the gain comes from wide day-to-day dispersion rather than consistent momentum.

Wellington, Brisbane, and Christchurch are all down 6–15% for the quarter, with pricing lifting only intermittently. Sydney is up 13%, but the increase is shaped by large day-to-day swings instead of a higher baseline.

Last year, many markets cut Q1 rates late in the cycle. This year, rates held or moved higher instead. Adelaide (+14%) and Auckland (+5%) show how baseline prices were maintained going into the quarter.

What Q1 2026 pricing trends mean for hotel revenue strategy

Q1 2026 pricing and demand data points to a hotel market where outcomes are increasingly determined by when rates can be pushed and how long they can be held. Segment positioning and event timing are all important, but the decisive factor is whether higher year-over-year rates can be sustained beyond peak demand periods.

Luxury hotels continue to show the most consistent performance. In many regions, five-star rates not only exceed last year’s levels but also hold across a wider share of the quarter.

By contrast, mid-market and value segments face clearer limits, particularly in high-supply urban markets where pricing outside peak periods remains fragile.

As a result, the gap between top-tier and midscale performance is widening. Within each segment, competitive positioning is becoming more decisive, as small differences in price and availability have a greater impact when demand is inconcistent and price sensitivity is higher.

Across many regions, elevated rates are proving difficult to sustain. Strong pricing often appears only around major events or holidays, then falls back quickly once those dates pass.

This pattern is especially visible in North America, China, and large Western European cities, where sharp event-driven spikes are offset by softer shoulder periods that weigh on quarterly averages.

By contrast, markets such as India, Brazil, and parts of Central Europe show pricing strength across a broader set of dates.

In these destinations, higher rates are not confined to isolated peaks, suggesting a more stable demand base and less reliance on short-lived event windows to support performance.

What this means for hoteliers

Q1 2026 shows that seasonal demand sets the backdrop, but pricing performance is now determined at a much more granular, date-by-date level.

1) Maximize those peaks using predictive intelligence

This shift makes predictive data intelligence a necessity. Using forward-looking demand signals and real-time competitive pricing data is the only way to maximize revenue around key event dates. 

By tracking demand in low periods, revenue teams can spot a pickup before the rest of the market. This allows you to be first with pricing, promotions, and marketing, capturing bookings before the competition even reacts.

When you have early visibility into how demand is building, you can increase your window of opportunity by positioning your offer to meet existing demand. This reduces the need for late discounting as you try to catch up with the market.

In event-driven markets, closely benchmarking your offer against similar properties is especially important, as small pricing gaps can materially affect conversion when guests are comparing options across channels.

2) Fill the gaps between peak periods

When demand softens, your strategy must shift from holding rate to actively filling rooms. These quieter periods require clear decisions on price, visibility, and how you structure your offer.

Competitive pricing data becomes critical at this point, as small gaps versus the market can have an outsized impact on conversion, particularly when demand is thin.

In these periods, broad rate cuts tend to have a limited impact and will weaken your pricing baseline once demand returns.

Targeted, conditional tactics tend to work better in these periods. Length-of-stay incentives, for example, can help lift weaker nights by spreading demand across multiple dates, rather than cutting rates on individual nights that do little to improve overall performance.

Value-based adjustments play a different role. Adding inclusions such as breakfast, parking, or flexible cancellation can improve conversion without changing the visible room rate, which helps protect rate integrity while still responding to price sensitivity.

Both of these are most effective when applied selectively, based on booking window and pickup patterns, rather than left open for the full period.

Distribution also plays a larger role when demand is soft. As direct bookings slow, wider visibility through OTAs or metasearch can help capture demand that would otherwise go elsewhere. In these periods, higher acquisition costs are often justified by incremental occupancy that would not have materialized through direct channels alone.

Filling the gaps between peaks is now a core revenue discipline. Without a clear strategy for softer shoulder periods, gains from high-demand dates are quickly diluted, leaving your overall performance overly dependent on a handful of event-driven spikes.

The properties performing best in Q1 2026 are not those chasing the highest peak rates, but those managing their full demand curve with precision. They anticipate demand shifts and manage pricing, value, and distribution as part of a single, deliberate strategy.

As short bursts of demand become more common across global markets, sustained commercial performance will depend on how effectively those moments are anticipated, captured, and extended.

That ability, more than seasonality or market strength alone, is what will separate strong performers from the rest as the year unfolds.