Scotland’s luxury, mid-market and budget hotels reported year-on-year growth in room rates and profits this August, outperforming the wider UK hotel sector, according to RSM UK’s Hotels Tracker: Focus on Asset Classes.
The data, compiled by Hotstats and analysed by RSM, revealed average daily room rates in Scotland’s luxury hotels rose from £393.35 to £491.86, with mid-market hotels increasing from £164.69 to £174.70. Even in the budget segment, where the wider UK market showed signs of slowdown, Scottish operators saw average rates climb from £140.59 to £151.21.
Gross operating profit per available room (GOPPAR) also rose across the board. Luxury hotels posted an increase from £254.25 to £328.93, while mid-market and budget hotels recorded growth from £87.53 to £95.35 and £75.03 to £79.17 respectively.
Occupancy trends told a more nuanced story. Scotland’s luxury hotels saw occupancy rise from 83.8% to 85.6%, and mid-market hotels edged up from 87.8% to 89.2%. Budget hotels, however, saw a dip in occupancy, falling from 88.1% to 83.3%, aligning with broader UK patterns in this sector.
Katie Morrison, partner and head of consumer markets at RSM in Scotland, said, “While Scotland’s luxury and mid-market hotels continue to perform strongly, in line with the wider UK trend, budget hotels are starting to show slight signs of divergence. In the UK, budget hotels saw falls across occupancy, room rates and profits in August, whereas in Scotland, room rates and gross operating profits saw a marginal uplift.
“August’s staycation season, bolstered by good weather and major events like the Edinburgh Fringe Festival, has helped sustain demand across Scotland’s hospitality sector. With many travellers opting to stay within the UK rather than travelling abroad, Scotland appears to have captured a greater share of domestic tourism, offering both cultural appeal and value for money.
“Budget hotels, however, are feeling the pinch, with the gap between room rates in budget and mid-market hotels continuing to close. This could explain why occupancy levels have dipped, suggesting that consumers may be shifting their preferences towards mid-market options, where the price difference is now less pronounced. Looking ahead, this could pose challenges for budget hoteliers, given they already operate on lower margins, which are being squeezed as costs rise and consumers opt for more premium experiences.”
Robyn Duffy, consumer markets senior analyst at RSM UK, said, “Global luxury spending has undergone a clear shift in 2025. The post-pandemic boom in luxury goods is giving way to a preference for high-end travel and experience-led purchases. Economic uncertainty and rising prices across major luxury goods, exacerbated by tariffs, are prompting affluent consumers to trade handbags for holidays, redirecting spend from products to experiences. Luxury hotels, first-class airfares and “once-in-a-lifetime” travel are all benefitting from this reallocation of spend.”
