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The travel industry is almost back on track.
However, high prices in the luxury goods sector, which rose after the coronavirus pandemic, have not returned to normal. In fact, that percentage is increasing every month.
Luxury hotel room rates have reached “peak levels” this year, with average daily room rates up 70% compared to 2019, according to luxury travel agency Virtuoso.
“July 2024 stands out with the highest percentage, with an 85% increase compared to July 2019,” a company representative told CNBC Travel.
Luxury train travel prices are also rising, with prices on Accor's yet-to-be-opened La Dolce Vita Orient Express rising 75% in 16 months. The starting price for an overnight trip on the train, which is scheduled to open in Italy in 2025, rose from 2,000 euros at the end of 2022 to 3,500 euros (about $3,776) last month.
Prices on Belmond's Venice Simplon Orient Express, another European luxury train, also jumped this spring, from 3,530 pounds in February to 7,060 pounds ($8,925) in March, according to website reviews.
Belmond has not yet responded to CNBC's request for comment, but Accor told CNBC Travel that its pricing and plans are “constantly evolving.”
Travel prices are rising for the same reasons that affect other industries, including inflation, rising labor costs, supply chain issues, and debt service rates.
But travelers' willingness to pay the new fares without flinching means the “old” fares for five-star travel could become a thing of the past.
Luxury travel prices are holding steady as inflation and cost increases ease.
Henry Harteveldt, president of travel market research firm Atmosphere Research Group, said that's because “the demand is there” even at significantly higher prices.
“For some of our guests, money is hardly an issue,” Harteveldt told “Squawk Box Asia” on Monday. “These are high-net-worth and ultra-high-net-worth travelers, and for them 1,000 euros or more than $1,000 a night is not a big deal. For most consumers, it's probably something like $250.”
He said wealthy travelers value new and different experiences, such as traveling on luxury trains.
“They want exclusivity…and these companies are going to take advantage of that as much as possible.”
For price-conscious travelers, competition will keep costs down in the budget and mid-range sectors, Harteveldt said.
“For those of us living on Earth…the price of cheap flights is coming down because competition is increasing,” he said. “Low-cost and mid-range hotels are among the fastest growing in the hotel sector. We are introducing lower-cost hotels.”
Booking early can save on airfare, but hotel pricing varies, he said.
“For hotels, you can either book early or wait until within two weeks of your travel date,” Harteveldt says. “I personally book refundable and changeable hotel rates [because] In some cases, I've noticed that as the check-in date approaches, hotel rates can drop if demand doesn't meet expectations. ”
Overall, travel demand remains strong, but research shows some travelers are starting to pay the bills.
But Dave Goodger, managing director for Europe, Middle East and Africa at Tourism Economics, an Oxford Economics firm, said this was not having the same impact on the luxury travel sector.
“The luxury boom continues despite flat economic activity in some major developed markets,” he told CNBC Travel.
He said the industry continues to see upward pressure on prices for luxury experiences.
“This situation happened because some travelers were looking for a more luxurious experience,” he said. “This also reflects the fact that among higher net worth households, income and asset levels, including accumulated savings, remain healthy.”
