Discount hotel rooms and cheap vacation packages remain in a good supply even though more people are traveling this year and staying at hotels.
Occupancy gains in 2011 are expected to outpace rising room rates. Demand for hotel rooms in the U.S. is forecasted to increase 5 percent while the average daily room rate will increase a little over 2 percent. Lodging demand rose almost 8 percent in 2010.
Competition for new guests remains strong and scarcity of hotel rooms has yet to be an issue for most lodgers.
Only 12 of the biggest 50 hotel markets in the U.S. will enjoy an occupancy rate in 2011 that is greater than their long time average. Experts think that the majority of the 50 largest hotel markets will not exceed their long run occupancy rates until 2013.
Continued high unemployment has retarded demand for hotels but has helped control the rise in labor costs at U.S. hotels. Labor costs make up almost 46 percent of hotel operating expenses in the U.S.
Given market conditions and labor cost containment, U.S. net hotel operating income is forecasted to increase almost 12 percent in 2011. Unlike previous industry recoveries, this time labor related costs are falling. www.cheapfares.com