Rising Rates and Budget Pressures | Situ Signals

Signal (noun): an indicator, sign, or event that prompts coordinated action
Signal (verb): to notify via a signal

Introducing Situ Signals, a new series of communications from Situ – the Global Accommodation Specialists – highlighting critical trends and market signals that everyone managing an accommodation programme needs to know. Here you’ll find Situ’s expert insights based on market sentiment and client experience, contextualised by trusted industry sources and verifiable data points.

This first report, Building Resilience: Improving cost efficiency in accommodation programmes draws together a growing number of signals emerging on the radar of Situ’s global accommodation specialists. It examines how various market pressures are lining up to squeeze the budgets of accommodation programmes, often in ways that can be easily missed. Grounded in insights from Situ’s experts, the report outlines practical solutions to protect pounds and pence, as well as processes that can be optimised to bring down costs – including how the strategic integration of serviced accommodation into programmes can lead to greater budget predictability and real cost savings.

Download full report

Across all markets, travel managers and buyers are broadly anticipating higher budgets and increased travel outlays. According to GBTA’s analysis¹ of their January 2026 poll², travel buyers are most concerned about the affordability of business travel (70%), compared to other concerns:

Travel buyer concerns:

Affordability of business travel (70%)
Ease of obtaining entry/exit permissions and visas (65%)
Employee safety (56%)

Responses from 571 GBTA members and non-members

With inflation showing little sign of slowing and amid ongoing geopolitical uncertainty, it’s no surprise that the overall cost of a business trip is front of mind for accommodation buyers, reinforcing the necessity of building more resilient, flexible programmes that can respond effectively to the current cost dynamics of sending people around the world for business.

What you’ll learn from this report

Signal 1: Rising rates and budget pressures: the external factors that are influencing affordability
Signal 2: Unexpected costs, explained: discover the invisible drains on your accommodation budget
Signal 3: Shifting stays and changing policies: trends to watch

Signal One: Rising Rates and Budget Pressures

Globally, higher hotel rates are contributing to overall increased costs in travel programmes. HotelHub data³ points to a 6.3% rise in nightly rates in Q4 of 2025 and a 3.13% increase across the full year, with above‑inflation growth in many European cities such as Madrid. While hotel rates showed increases linked to demand, operating costs, and inflation, pricing for serviced apartments remained relatively stable through the year, as a reported by an analysis of twenty-six European gateway cities by Savills⁴. The study notes that serviced apartment pricing in 2025 was more linked to occupancy and longer stays, with demand for compliant extended stay options being one of the drivers of rate stability.

How Situ helps you build resilience

Serviced accommodation consistently delivers better value than hotels for trips of one week and more, with cost efficiency only increasing with length of stay. The relative predictability in terms of initial rates within the serviced accommodation sector provides easier budget forecasting and can help managers shore up resources at a time of known travel volatility.

“The one area where we see the most cost savings is in the initial rate. Where possible, we ask for a budget upfront so that we’ve got something to work with. We will always try to save the client money.”

Vicky Barlow, Client Success Manager

The AI factor

Another element influencing higher and more unpredictable nightly hotel rates is that accommodation operators are increasingly sophisticated at pricing their rooms, with dynamic rates a growing trend, with artificial intelligence behind new and more advanced revenue optimisation tools.

At Situ, we combine intelligent technology with specialist human insight to help travel managers gain greater control, visibility, and confidence in their mid-term and extended stay programmes. Situ works closely with clients on reporting and data analysis to build a clear picture of requirements and ongoing programme metrics. By allowing full visibility of spend, usage, and trends, we help to continually refine and future‑proof accommodation programmes. This iterative approach allows clients to plan spend more accurately, reduce inefficiencies, and maximise the value of their accommodation budget.

“Data and visibility are key for our clients at the moment.”

Hannah Trigg, Client Development Manager