Property owners in the Mother City need to consider the changing market when setting prices for home sales and lets. Picture: Pxhere

CAPE TOWN - The latest Consumer price index (CPI) data published by Statistics South Africa showed that hotel prices in the Western Cape fell by 11.2% between May 2017 and May 2018. 

The biggest problems are being experienced by five-star hotels, especially in the Western Cape.

Occupancy at five-star hotels in Cape Town in April was 55.8% compared to 69.4% last April, while average daily rates were R2 727 against R3 241 last year. Four-star hotels are also suffering, with occupancies at 56% (67%) and average rates at R1 200 (R1 300).

In Gauteng, prices were up by 3.5%, and in the North West prices increased by 4.5%. Compared to other provinces in the country, The Western Cape numbers are much lower. 

The Northern Cape and Mpumalanga both saw small drops in prices – but the national average price of a hotel room increased by 0.6% during the same period.

The price decreases in the Western Cape came despite hotels spending heavily on new water infrastructure. Foreign tourist arrivals to South Africa have continued to decline during 2018 to date, by nearly 7% according to the most recent figures.

Occupancy levels, especially in five-star hotels in Cape Town, are also down.

Other provinces include:

1. Free-State increased by 2.1%

2. Limpopo increased by 1.9%

3. KwaZulu Natal increased by 1.0%

4. Eastern Cape increased by 1.6%.

Additionally, Tourism Minister Derek Hanekom, on Tuesday said that Day Zero is to blammed for the low tourist visits in Cape Town reported Business Day. He said in an interview that many tourists especially from the UK, which is SA’s biggest single overseas source market would have put off travelling to SA in 2018 because of the drought in Cape Town.

Hanekom said discussions between the departments of tourism and home affairs were ongoing on ways to ease access of tourists to SA, including the recognition of the visas issued by visa-secure countries such as the UK, the US and Australia.

Rainfall over the area in the last four weeks has pushed the water level of dams in the province back up to amounts seen in winter 2017.

Water levels have risen 6.3 % to 38.1% in the last week, the biggest increase all year. However, the City of Cape Town has urged residents to continue using water sparingly.

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- BUSINESS REPORT ONLINE