Capri is hot, but Hotels.com shows huge rate drops in cities worldwide

(Natalia Barsukova)

The most expensive average hotel rates may be found on the Italian island of Capri, but the world's hotel rates were down by an average of 17 percent over the first half of 2009, according to the Hotels.com Hotel Price Index, issued October 21.

"Not since 2001, in the aftermath of 9/11 [terrorist attacks in the US], has there been such a collapse - surely the word is justified - in global hotel prices," began the report from the online travel agency.

London and Zurich have dropped out of the top 10 list of most expensive destinations, with also Tokyo dropping conspicuously. Despite huge price cuts, Moscow and St. Petersburg are still among the priciest cities.

With the exception of the Caribbean, hotel prices in every major region experienced their greatest drops since the Hotel Price Index's inception in 2004. Hotels in Latin America dropped the most (18 percent), followed by North American hotels (17 percent) and then Europe (16 percent).

According to the report, the Great Recession has made some significant alterations in the flow of tourism. Due to the drop in value of the pound, demand from continental Europe has actually increased to the UK this year, while the drop of the dollar has led US travellers to travel beyond their borders even less.

As the report concludes, it is not just hotel prices that have been reduced, but prices for all goods and services across the travel industry. If you can afford it, it's a good time to be a traveller.

Hotels.com Hotel Price Index - Most Expensive Cities

Rank	City	Average Room Price ($) from Jan.-June 2009	% Change from Jan.-June 2008
1	Capri	279	+12
2	Abu Dhabi	273	-9
3	Geneva	243	-28
4	Moscow	218	-52
5	Venice	218	-20
6	Cannes, France	208	-20
7	New York City	196	-30
8	Dubrovnik, Croatia	193	-20
9	Dubai	192	-26
10	Paris	187	-18
11	Rio de Janeiro	185	+11
12	Rome	183	-21
13	St. Petersburg	183	-29
14	Zurich	181	-21
15	Copenhagen	181	-24
16	London	176	-25
17	Jerusalem	175	+7
18	Milan	173	-22
19	Cancun	172	-21
20	Kyoto	168	-17

Rates are based on US dollar prices paid by US travelers from the between January and June 2009, compared with the same period a year before.