Avoid hotels for best World Cup prices, suggests survey

(AFP PHOTO / ALEXANDER JOE)

Over a third of South African hotels are charging rates at a 50 percent premium during the FIFA World Cup, according to research conducted by auditor Grant Thornton.

The research, commissioned by the South African Office of Tourism, suggests that the province of Gauteng, home of the Johannesburg (host of the final match) and Tshwane/Pretoria Stadiums, is the most overpriced. Sixty-five percent of establishments in the area were charging prices over 50 percent higher than the "rack rate" (standard price per night).

Also, 53 percent of accommodation providers in Durban, which will host one of the semi-finals, are charging rates over 50 percent higher than their standard rates. In Cape Town, which has been widely criticized for overpriced accommodation, 20 percent of establishments were charging rates at a 50 percent premium or higher.

Across all areas and accommodation sectors, about a quarter of accommodation providers are charging price premiums of more than 50 percent above the high season rate for 2010.

For travelers, it seems that the best way to avoid being ripped off is to avoid hotels, guesthouses and B&Bs altogether. The research suggests that further down the accommodation scale, establishments have not raised prices on such a wide scale - the number of establishments with prices at a 50 percent premium falls to 21 percent for hostels, 20 percent for lodges (establishments located on a farm or hunting area), 14 percent for self-catering establishments and 11 percent for caravan/camping parks.

Similarly, only 12 percent of top-end five star providers were found to be charging a 50 percent premium - compared to 41 percent of one- and two-star establishments.

South Africa has been quick to point out that prices naturally rise during events that generate visitors and widespread global interest. For the Athens Olympic Games in 2004, the average room rate rocketed by 260 percent in the city, damaging visitor numbers.

"The survey has found that the addition of price premiums to normal high season rates for accommodation during major events is a global norm," said Marthinus van Schalkwyk, South Africa's Minister for Tourism. "During such events, normal economic principles of supply and demand result in premium pricing."