Global prices for serviced apartments, including major European cities, are continuing to decline in 2024, according to the latest quarterly report from SilverDoor.
The serviced accommodation agency’s quarterly report, covering the three months from November 2023 to January 2024, found that the average daily rate (ADR) for apartments globally fell by 3 per cent to £157.60 year-on-year.
Rates for serviced apartments in the EMEA (Europe, Middle East and Africa) region mirrored this global decline with a 3.1 per cent fall to £160.40 for the three-month period. There was an even larger reduction in prices in the Americas region with a 9.8 per cent year-on-year drop in ADR to $199.75.
SilverDoor blamed current “geopolitical events” such as the war between Israel and Hamas, as well as forthcoming elections in many countries this year, for the decline in prices.
The agency also noted other trends such a 25 per cent reduction in the average length of stay in apartments globally, which indicated “a more cautious approach to corporate travel”.
Martin Klima, chief customer officer at SilverDoor, added: “Wider geopolitical events are undeniably impacting business and accommodation – the incoming wave of elections worldwide is likely to have particular implications for the travel market.
“Whilst there seems to be less rate fluctuation and a reduction of rates in some markets, global instability poses the risk of business uncertainty, less travel confidence and unpredictable market conditions.
“As we head further into the year, it will be interesting to watch how the market shifts in terms of supply and demand as corporate clients maintain a keen eye on cost.”
SilverDoor’s report also predicts a decline in ADR over the next 12 months for apartments in key European cities such as London, Amsterdam and Dublin.
Amy Pammenter, SilverDoor’s head account manager, added: “Rates are competitive and availability is good throughout the EMEA region, with the exception of Paris where there is limited availability and significant ADR hikes for bookings being made around the Olympics and Paralympics.
“Our London team is also noticing flatter nightly rates than usual due to reports of low occupancy from property operators in the UK capital.
“Whilst supply is ever improving in the big cities, demand is increasing faster than supply in tertiary locations like Ireland’s Limerick and small towns in Italy and Germany.”
Elsewhere, demand and occupancy levels for serviced apartments is continuing to grow in destinations such as Dubai and India.