"Life Is Short": US Hotel Prices Soar To Record Highs On Consumer Driven-Demand
Lodging analytics company STR reports that the average daily hotel rate (ADR) increased to $149.38 last week, the third-highest ever, besides March 19 and the week after Christmas.
Demand appears to be coming from consumers who are booking on weekends, which has made up for the lack of corporate travelers.
Jan Freitag, senior vice president at STR, told Bloomberg, "the pandemic has reminded people that life is short."
"They want to splurge, and they have a lot of pent-up savings. If a market has a leisure appeal, then the hotels in that market are doing well," Freitag said.
All pandemics end eventually, and the latest signs of sustained declines in COVID-19 infections and deaths, and a large percentage of people are estimated to have some form of immunity, are promising signs people want to see before returning to hotels and resorts.
The CDC recently released a new framework that says most Americans can drop their masks indoors is another belief to some that the pandemic is subsiding.
CDC Eases Mask Guidelines for Indoor Public Spaces *Including Schools --WSJ
— zerohedge (@zerohedge) February 25, 2022
What will dictate if the pandemic is over isn't 'science' or the government but rather society. This was the same after the 1918 pandemic, when people stopped paying attention and moved on after infections and deaths declined.
Amber Asher, the CEO of Standard International (parent company of Standard Hotels), said, "We're not raising rates because of labor costs. "It's really just demand-driven."
Americans appear to be going to big cities and staying at hotels -- for whatever reason -- if it's a staycation or vacation, it is a welcoming sign and perhaps a proxy that some in society are ready to take the next giant leap in their lives and move on after losing two years of their lives due to pandemic-related lockdowns enforced by the government.
Being cooped up in a house or condo for two years has reminded everyone that life is short. Get out there and spend, which is the current mood of the consumer, though the 2-year to 10-year spread, the most closely watched part of the yield curve, inverted this week, and sends an ominous sign that the bond market sees economic turmoil ahead.
So is 2022 the last hurrah for consumers?
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