European hotel industry in August 2025: guests are present but watching their budget – By MKG Consulting

European hoteliers posted a 6.9% decline in RevPAR and average daily rates, which also fell by 6.9%, while occupancy remained stable at +0.1 points. As in previous months, growth was driven by the most upmarket segments. However, the European market is anything but uniform in terms of performance in August 2025.

Two of the largest markets are struggling, but not for the same reasons

Germany continues on a downward trend that began at the start of the year. After a slight rebound in July, the cycle is back in the red. The domestic market is unable to sustain activity and is not offset by foreign customers, who visit less frequently during the summer period. As a result, OR is down 1.6 points, the worst performance in the panel. RevPAR is down 12.2% compared to August 2024. August 2024 was particularly positive for the destination, with a strong impact from Adele’s two concerts in Munich. However, the longer-term trend is also negative (-1.8%) compared to 2023.

France is in a different cycle, with a very unfavourable comparison with the Paris 2024 Olympic Games. Occupancy rates were down 1.3 points and, more significantly, average daily rates fell by 15.8%, the sharpest decline in the panel. France was also the first country to recover after Covid-19 and is therefore one of the first to see activity slow down and normalise.

Upturn in Northern Europe

The Netherlands is one of five destinations in the panel to post RevPAR growth of more than 5%. The destination was boosted by a once-in-a-decade event, SAIL Amsterdam, which attracted 2.5 million visitors between 20 and 24 August.

In the United Kingdom, the upward trend in performance already seen in July continued. OR was up 0.8 points compared to August 2024 and August 2023, while ADR was down slightly to 0.4%, below the country’s inflation rate (+3.8%).

The warmth of the Baltic Sea attracted swimmers

Latvia and Poland welcomed many tourists attracted by exceptionally warm waters this summer. Meanwhile, Russian customers remained close to Russia given the geopolitical context in Europe fuelled by the war in Ukraine that broke out in February 2022.

Latvian hoteliers were able to increase their average daily rates by 20.9%, a trend that also follows the overall inflation rate in the country (+4.10% in August). Hotel occupancy remained stable, up 1.2 points to 84.7%. As a result, the destination’s RevPAR showed the strongest growth in the panel at +22.6%. The range of balneotherapy and spa services on offer has regained its popularity.

In Poland, occupancy rates rose by 2.1 points compared to August 2024, but prices were down by 3.7% compared to August 2024. Here too, the development of the range of services on offer is partially limiting the potential for price increases on the Polish market.

Short stays…

In the heart of Europe, Hungary is breaking all records with RevPAR up 18.6% compared to August 2024. All indicators are green, with OR up 3.9 points and ADRs up 13%. The Ziget Festival, held from 6 to 11 August on the island of the same name, attracted record numbers of visitors. 416,000 visitors flocked to the stages and installations. This is more than the island can accommodate in terms of overnight stays. Those disappointed by the lack of on-site camping had to fall back on accommodation in the city of Budapest. Impacted by high inflation (energy prices up 11%, for example), hoteliers increased their average daily rates by 13%.

In Belgium, too, the results are positive. Numerous festivals throughout the country attracted summer visitors. Ronquières welcomed between 65,000 and 70,000 spectators, Pukkelpop more than 6,600, the Royal Palace Open Air 21,600, WECANDANCE 54,000 and Les Solidarités 60,000. This had a definite impact on certain small and medium-sized markets and on the Brussels market, which was thus able to offset the seasonal decline in business tourism. However, performance was slightly impacted by the growth in hotel supply in Belgium in 2025.

The Czech Republic also posted strong occupancy growth, with OR up 5.8 points (the best growth in the panel). However, average daily rates were down 6.4% compared to August 2024. Here again, a rich programme of events attracted visitors, some of whom became tourists. According to Radio Prague International, Prague Pride attracted a record 30,000 people this year. Added to this was the International Contemporary Circus Festival from 12 to 31 August

… and controlled budgets

In seaside destinations, average daily rates are down, with the notable exception of Spain. There is no common trend for Greece, Portugal, Italy and Spain.

In Greece, hoteliers chose to lower their ADRs by -1.1% (still +5.1% higher than in August 2023), resulting in a +2 point increase in occupancy to 80.5%. These figures enabled RevPAR to rise slightly by +1.5%. As August is the most important month in terms of revenue, this development is crucial for the tourism economy (18% of GDP according to the Greek government) and comes on top of an already strong July.

Italy posted a 0.6% increase in RevPAR despite a 2% drop in average daily rates, with OR rising by 1.8 points. In August 2024, Italian hoteliers increased their ADRs by +4.5%.

In Portugal, hotel capacity continues to grow and OR is stabilising at around 85%. Average daily rates are down for the second consecutive summer due to leisure customers now being price-sensitive. RevPAR is therefore down by 1.7%.

As for Spain, the sun is shining brightly. Occupancy is up by 1.8 points and average daily rates by 4.9% (up 14.6% compared to August 2023). Tourists turned out in force for their summer break in one of the Old Continent’s flagship destinations for the unmissable sol y playa. They also flocked to the many events that enliven the Spanish capital throughout August.

The ADR driver slowed significantly, while for some destinations the summer period meant that hotels were almost fully booked. The drivers of revenue growth will be additional offerings, which will need to be compelling enough to encourage customers to spend more.

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