THE IRISH HOTEL market has shown signs of recovery in the first six months of this year, with the average room rate rising two per cent over that period.

It is the first increase that the market has seen in three years; Ireland saw prices fall 35 per cent in three years leading up to this year. Despite the price increase, however, Ireland is still classed as the least expensive destination in western Europe and the fourth least expensive in Europe.

The average price of a room in Ireland is currently €81, with Dublin hotel rooms priced between €73 to €75 on average, according to the latest Hotel Price Index by Hotels.com. Dublin is now rated as the best value capital city in western Europe, with average hotel prices significantly lower than other capitals such as London (€134), Paris (€114) and Vienna (€100).

In contrast, the average price for a hotel room in Wexford and Kilkenny comes in at €104 – making those the locations the most expensive in the country.

Limerick has taken Waterford’s place as the least expensive location for hotel accommodation in Ireland, with the average room costing €63 per night.

Ireland was one of the few Eurozone countries experiencing economic instability to see a raise in average hotel rates; Greece (- 3 per cent), Spain (-2 per cent) and Portugal have all noted a drop in prices.

In terms of  average hotel prices, the Czech Republic (€79), Poland (€76) and Hungary (€65) are the only destinations in Europe less expensive than Ireland.

Switzerland is ranked as the most expensive country in which to rent a hotel room, while Capri is classed as the most expensive location in the world.

The Hotel Price Index is based on bookings made on Hotels.com and prices shown are those actually paid by customers in the Eurozone (rather than advertised rates) in the first half of 2011.