2025
9
UK Hotels Market Report 2025
2025-12-29T16:01:27+00:00
REP0542D907_05E6_4413_81E1_1BDFC872289F
2195
189968
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Report
en_GB
55% of consumers used hotels in the last 12 months, up 5 percentage points year-on-year and marking a rebound from slower post-pandemic demand. However, value consciousness dominates consumer decisions, with…
UK
Hotels and Accommodation
simple

UK Hotels Market Report 2025

"Hotels must enhance their services and facilities to compete with alternative accommodations and establish themselves as inviting ‘third spaces' to drive repeat visits."

Sinead O'Connor, Travel Analyst

Sinead O'Connor, Travel Analyst

UK Hotel Industry – Trends and Insights

  • 55% of UK consumers used hotels in the last 12 months, up 5 percentage points year-on-year and marking a rebound from slower post-pandemic demand.
  • Value consciousness dominates consumer decisions, with the cost-of-living squeeze leading to shorter breaks and a clear preference for the security and reliability of chain hotels.
  • Rising operating costs are now a key challenge for the sector, acting as the biggest threat to sustained growth. Hoteliers face pressure from higher payroll costs, shifting business rates and the introduction of new tourist taxes, threatening margins and prompting a reassessment of staffing, pricing and investment.
  • Inflationary pressures make it harder for hotels to compete on price with holiday rentals, which are perceived as offering better value, putting the onus on hotels to sharpen their competitive advantages.
  • At the same time, there is a growing appetite for hotels to serve as vibrant third spaces, blending high-quality foodservice, authentic local character and greater opportunities for social connection. Hotels that respond to shifting consumer values and embed themselves more deeply in local life will be best placed to compete and thrive long-term.

This Report Looks at the Following Areas:

  • Hotel accommodation over the last 12 months, including booking channels and comparison with other accommodation types
  • Future demand for hotel stays and reason for visitation, including increasing longer stays among high-earners
  • Perceived benefits of holiday rental properties vs hotels, and opportunities to drive competitiveness through family offerings and local character
  • Factors that most influence the choice of a hotel, including the importance of top-quality facilities
  • Trading up opportunities, including with childcare facilities and local culinary experiences

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  1. EXECUTIVE SUMMARY

    • What you need to know
    • Outlook for hotels
    • Opportunities
    • Best of both worlds: blend high-class service with a local touch
    • Win over families with dedicated services
    • Position hotels as a third space
  2. THE MARKET

    • Snapshot – market size and forecast
    • Volume sees positive growth
    • Graph 1: volume of UK hotel/motel/guesthouse trips (domestic and inbound), 2020-25
    • Value holds steady
    • Graph 2: value of the UK and similar accommodation sector, at current prices, 2020-25
    • A slow recovery head for hotel stays
    • Graph 3: market volume forecast for hotel trips in the UK, 2019-30
    • Value continues to reach new heights
    • Graph 4: value forecast for the UK hotel and similar accommodation sector, at current prices, 2019-30
    • The cost-of-living crisis still looms large
    • Graph 5: perception of the state of the cost of living crisis in the UK trend data, 2024-25
    • Rising costs put pressure on the hospitality sector
    • Holiday bookings peaked over summer
    • Graph 6: holiday bookings in the last three months, Jan-Nov 2024 and 2025
    • Events drive hotel demand
  3. THE CONSUMER

    • Participation in hotel stays
    • Hotel usage is on the rise
    • Chains grow against independents
    • Graph 7: select types of accommodation used in the UK in the past 12 months, 2024-25
    • Booking method
    • Website bookings are most popular
    • Online bookings take share from offline channels
    • Third-party booking most popular for independents
    • Graph 8: booking channels used for last hotel stay in the UK, by select accommodation types used, 2025
    • Future stays and purpose of visit
    • Consumers’ focus is on affordability
    • Graph 9: intentions to stay in a UK hotel in the next 12 months, by type of hotel, 2024-25
    • Interest grows in short stays and VFR
    • Longer holidays appeal to top-earners
    • Competition with holiday rentals
    • Rentals are seen as the value choice
    • Graph 10: perceived benefits of holiday rental properties vs hotels, 2025
    • Tailor family room offerings for children’s age
    • Local character could be a game-changer
    • Factors that influence choice of hotels
    • Cleanliness tops purchase drivers
    • Local guides are an easy win
    • Focus on top-quality facilities to drive spend
    • Graph 11: select factors that influence choice of hotels, by consumer segment, 2025
    • Trading up opportunities
    • Parents are willing to spend on childcare services
    • Graph 12: interest in trading up, 2025
    • Local culinary experiences appeal
  4. INNOVATION AND MARKETING

    • Hilton and McLaren partner on F1-themed suites
    • Trip.com and Live Nation bundle hotels with concert tickets
    • Radisson Hotels offers direct restaurant booking
    • Perplexity now allows for hotel bookings
    • Fashion meets hotels in Michael Kors campaign
    • Summer at Rosewood emphasises the power of the moment
    • Warner Hotels offers more than just a room
  5. APPENDIX

    • Market forecast data and methodology
    • Market size
    • Market forecast and prediction intervals (volume)
    • Market forecast and prediction intervals (value)
    • Forecast methodology
    • Forecast methodology – fan chart
    • Report scope and definitions
    • Market definition
    • Abbreviations and terms
    • Annual Business Survey by the ONS
    • The consumer
    • Consumer research questions
    • Consumer research methodology
    • TURF methodology
    • TURF analysis – additional data

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