Is the Philippines Really More Expensive for Travelers Than Our SEA Neighbors?

For many local travel sellers, lawmakers and even the public, the Philippines is losing its status as a preferred travel destination partly because of soaring hotel rates and high airfare costs. More Filipinos are even choosing to travel abroad because they say all-in travel packages cost less than traveling in the Philippines. The numbers bear out this observation: in 2024, seven million Filipinos traveled abroad, exceeding the 5.95-million foreign tourists who visited the Philippines that year. 

But for a local hotel group, that’s simply not true. In fact, the group argues that Philippine hotels remain competitive in terms of average daily rates (ADR) compared to their counterparts in the Southeast Asia, and the prices merely reflect the cost of doing business in the country.

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“I think the notion that ‘the Philippines is expensive,’ is not true,” Francis Gotianun, vice president of the Philippine Hotel Owners Association (PHOA) said in an interview. “We have to look at data. Our [hotel] prices are at par; they (other countries) just have more options. We have less options, we have less room inventory.

“We are not expensive, we are competitive,” added Gotianun, who is also the senior vice president of Filinvest Hospitality Corp.

PHOA Executive Director Benito C. Bengzon Jr. agrees with Gotianun, and even cited other factors that contribute to the disparity in hotel pricing. 

“The Philippines is the third most expensive [in Southeast Asia] in terms of power,” he said. “On wages, we are also the third most expensive. So the margin of a hotel which charges $80 in Hanoi is different from our margins. There are other soft costs, like food.”

“But hotels will never price themselves beyond the means of their target market,” Bengzon added. 

Tour operators have also complained about so-called “dynamic pricing” that hotels use, which result in rates today that they say are even higher than before the pandemic.

Dynamic pricing is when businesses adjust prices in real time based on current market demand or other factors. This means room rates surge when there is an increased demand or during peak periods, allowing hotels to maximize their revenues. The strategy is also practiced by airlines and transport network vehicle services like Grab. 

According to data from Leechiu Property Consultants, in April 2025, mostly upper segments in the hospitality industry have raised their ADRs by at least 14 percent from 2019 to 2024. Occupancy rates among Philippine hotels have slipped by eight percent to 60 percent during the same period.  

The PHOA is an organization that represents 217 hotels with a combined total of over 40,000 rooms. The group is scheduled to hold the Philippine Hotel Connect (PHCon) 2025 on July 24-25, 2025, at the Marriott Hotel Manila in Pasay City. The event offers hotel owners and investors an opportunity to network and find ways to capitalize on the Philippines’s expanding tourism market amid the post-pandemic recovery, evolving traveler preferences, and trends. 

About 250 leaders from the hotel industry, investment community, property development, and government are expected to attend the conference, which will be headlined by guest panelists like Alliance Global Chief Executive Officer Kevin Tan, Ayala Land Group Head for Leasing and Hospitality Mariana Zobel de Ayala, among others. 

“PHCon 2025 ensures attendees are at the forefront of industry innovations, policy developments, and investment opportunities. It’s an opportunity to influence the future of Philippine tourism, while securing investors ’stakes in its promising trajectory,” PHOA President Arthur Lopez said during a briefing to launch the two-day conference. “PHCon 2025 is a collaborative effort among all leaders in the tourism sector, especially the hotel indstry. Through the contributions of time and expertise from our invited speakers, we are able to provie a platform for premier networking and sharing of various strategies that will allow us to solidify and further expand the Philippine tourism industry.”