Published on
October 6, 2025
In 2025, San Diego’s hotel rates surged 31%, averaging $177 per night due to increasing demand from both leisure and business travelers. This surge in pricing aligns with the strong performance of other major cities like San Francisco, New York City, Las Vegas, Boston, and Chicago, which are also seeing record hotel occupancy rates despite a general travel freefall. These cities have managed to supercharge the U.S. hotel industry, drawing both domestic and international visitors through a combination of major events, business-friendly environments, and growing tourism appeal. This article explores how San Diego, alongside these iconic cities, continues to thrive in the face of travel disruptions, fueling the resilience of the U.S. hospitality sector.
San Diego
San Diego has seen a significant surge in hotel prices in 2025, with rates increasing by 31%, bringing the average rate to $177 per night. This increase is indicative of the city’s growing demand, as it becomes an increasingly popular destination for both leisure and business travel. San Diego’s booming tourism sector has driven up prices, with a rise in both domestic and international visitors. The city’s coastal beauty, world-renowned attractions, and business-friendly environment continue to attract a diverse range of visitors, driving up demand for hotel accommodations. The 31% increase in hotel prices reflects this surge, as the city works to meet the rising demand. While this price jump signals a healthy hospitality market, it also points to potential concerns regarding the rising cost of travel. Despite these challenges, San Diego remains an attractive destination, with continued growth expected in its tourism and hospitality sectors.
Hotel Booking Rules and Regulations in San Diego:
- Hotel Occupancy Tax: San Diego levies an 10.5% occupancy tax on all hotel room stays.
- Short-Term Rental Regulations: Hosts are required to obtain a business license, and rentals must be registered with the City of San Diego to comply with zoning laws.
- Booking and Cancellation: Hotels are mandated to clearly disclose their cancellation policies and provide a minimum of 24 hours for free cancellations.
- Sustainability Standards: San Diego hotels are encouraged to meet sustainability standards under the San Diego Green Business Program, which includes waste reduction and energy-efficient practices.
San Francisco
San Francisco’s hotel market in 2025 is forecast to see an occupancy rate of 65.2%, which, while solid, shows more moderate growth compared to other major cities. The average daily rate (ADR) in the city is $232.63, reflecting a healthy but stable pricing environment. However, the city has been greatly impacted by event-driven growth, with significant events like the NBA All-Star Game and the Laver Cup contributing to a 64% increase in hotel room nights. These events provide a substantial boost to San Francisco’s hotel industry, attracting both domestic and international visitors. The city’s ability to attract large-scale events continues to be a key driver of hotel demand, as visitors flock to the city for both the cultural and sporting experiences it offers. The overall surge in bookings during these events is a testament to the ongoing importance of event tourism for San Francisco’s hospitality industry, which continues to benefit from high-profile events while maintaining stable growth.
Hotel Booking Rules and Regulations in San Francisco:
- Hotel Occupancy Tax: San Francisco charges a 14% hotel tax, plus an additional 1.5% in tourism improvement fees.
- Short-Term Rental Regulation: Short-term rentals must be registered with the city, and hosts must reside in the property for at least 275 days per year.
- Booking Policy Transparency: Hotels must provide clear booking and cancellation policies and may not charge excessive fees for changes or cancellations.
- Health and Safety: Hotels are required to follow stringent health and safety regulations set by the San Francisco Department of Public Health (SFDPH).
New York City
In 2025, New York City remains at the forefront of the U.S. hotel industry, achieving one of the highest occupancy rates in the nation. With 85.2% occupancy recorded in July, the city continues to draw substantial demand from both leisure and business travelers. However, this surge in occupancy contrasts with a 13% decline in bookings during the first quarter of 2025, compared to the same period in 2024, signaling a potential shift in traveler habits or preferences. This decline may be attributed to a variety of factors, including rising hotel rates and changing travel trends. In terms of pricing, New York commands some of the highest average daily rates (ADR) in the country, with $639 per night for 5-star accommodations. While this reflects the city’s strong market demand, it also highlights the challenges posed by rising costs. Despite the slight downturn in bookings, New York’s overall hotel performance underscores the resilience of its tourism industry, with continued high occupancy rates and premium pricing showing the ongoing allure of the city as a top global destination.
Hotel Booking Rules and Regulations in New York City:
- Hotel Occupancy Tax: A tax rate of 5.875% is applied to the room rate.
- New York City Hotel Regulations: Hotels must be licensed by the New York City Department of Consumer and Worker Protection (DCWP).
- Booking Restrictions: Short-term rentals (less than 30 days) are only allowed in certain situations, with restrictions on whole apartment rentals without the host being present.
- Cancellation Policies: Hotels are required to disclose their cancellation policies at the time of booking. A standard cancellation window is 24-48 hours before check-in.
Las Vegas
Las Vegas has remained one of the most dynamic hotel markets in the U.S. in 2025, driven by its continued popularity as a global entertainment and leisure destination. The city’s hotel industry has experienced a surge in bookings, particularly during major events like conventions, music festivals, and sporting events. In 2025, hotel occupancy in Las Vegas is expected to hover around 84.3%, with a steady demand for both luxury and mid-range accommodations. The average daily rate (ADR) for a standard room is $195, while high-end resorts and luxury hotels push rates even higher, reflecting the strong influx of both business and leisure visitors. As one of the country’s premier resort destinations, Las Vegas has experienced a 5% increase in hotel bookings compared to the previous year, further solidifying its position as a top travel destination for both domestic and international tourists. The city’s hotel performance is closely linked to its vibrant entertainment scene, which continues to be a major driver of demand for accommodations.
Hotel Booking Rules and Regulations in Las Vegas:
- Hotel Occupancy Tax: Las Vegas charges a 13.38% hotel tax, which includes both state and local taxes.
- Booking and Cancellation: Hotels are required to disclose cancellation policies, with standard windows ranging from 24 to 48 hours before check-in. Some hotels may charge non-refundable fees for certain reservations.
- Short-Term Rentals: Short-term rentals, including those listed on platforms like Airbnb, are subject to strict regulations. Hosts must register with the City of Las Vegas and adhere to zoning restrictions, including limits on the number of rental properties per owner.
- Event-Driven Regulations: During major events or conventions, hotels may implement minimum stay requirements or surge pricing, especially for peak dates like weekends or holidays.
- Gaming and Resort Fees: Most hotel rooms in Las Vegas are subject to a resort fee in addition to the room rate, which can range from $20 to $50 per night. These fees cover amenities like Wi-Fi, pool access, and fitness centers.
Boston
Boston has become one of the most expensive hotel destinations in the U.S. in 2025, with average hotel rates reaching $320 per night, marking a 5% increase compared to the previous year. This rise in hotel rates reflects the city’s growing appeal, particularly for business, academic, and leisure travelers. Boston’s combination of rich historical attractions, a vibrant cultural scene, and a strong academic presence keeps it in high demand. The increase in pricing is also reflective of the city’s ongoing recovery and strength in the market, particularly as demand for upscale accommodations continues to rise. As Boston’s hotel industry continues to attract premium-priced visitors, it also faces challenges in maintaining affordability for more budget-conscious tourists. Nevertheless, the city’s rising rates illustrate its status as a top-tier destination, with visitors willing to pay a premium for its world-class offerings.
Hotel Booking Rules and Regulations in Boston:
- Hotel Occupancy Tax: Boston imposes a 6.5% hotel tax, in addition to the state tax, making it one of the higher tax rates in the country.
- Booking Policies: Hotels in Boston are required to provide clear information on booking policies, including cancellation deadlines, penalties, and payment terms.
- Short-Term Rental Compliance: Short-term rentals are subject to city regulations requiring hosts to obtain a permit and adhere to strict safety guidelines.
- Public Safety Measures: Hotels must adhere to Boston Fire Department regulations, including fire safety systems and regular safety drills.
Chicago
Chicago experienced a record-breaking summer in 2025, with over 3.5 million hotel room bookings between June and August. This surge contributed to a remarkable $949 million in hotel revenue, underscoring the city’s thriving tourism sector. Chicago’s average daily rate (ADR) for hotel rooms stood at $573 per night, reflecting a 36% increase from the previous year. The city’s robust performance is largely driven by both business and leisure travel, with Chicago attracting a mix of convention-goers, tourists, and local visitors. The rise in ADR indicates a growing demand for premium accommodations, especially during peak seasons. However, as the city experiences significant price hikes, there are concerns about the affordability of stays, especially for those on a tighter budget. Despite these price increases, Chicago’s tourism sector remains strong, driven by the city’s cultural appeal and numerous world-class events.
Hotel Booking Rules and Regulations in Chicago:
- Hotel Occupancy Tax: Chicago imposes a 4.5% hotel tax in addition to the state sales tax.
- Booking Regulations: Hotels are required to ensure compliance with the Illinois Hotel & Motel Association (IHMA) standards for cleanliness and safety.
- Short-Term Rentals: Short-term rentals like those offered on platforms such as Airbnb are allowed but must comply with the city’s registration and insurance requirements.
- Deposit Policies: Many hotels require a security deposit upon check-in, which is refundable upon checkout if there is no damage.
Surge in Hotel Bookings Amid U.S. Travel Decline
Despite a general decline in U.S. travel in 2025, marked by reduced international arrivals and a slowdown in business travel, the hotel industry has experienced a remarkable surge in leisure travel bookings. Key trends in the industry include:
Resilience of the U.S. Hospitality Industry: Despite challenges in business travel, the surge in leisure travel has led to climbing hotel revenues, showcasing the resilience of the U.S. hospitality industry in a shifting travel landscape.
Leisure Travel Surge: There has been a notable shift toward domestic leisure travel, especially to major cities and popular tourist destinations, leading to higher-than-usual occupancy rates.
- Americans are seeking local getaways, extended weekends, and city breaks, which have driven demand for hotels, particularly during peak seasons.
- Cities like Las Vegas, Chicago, and San Francisco have seen a rise in bookings due to major events, entertainment, and tourism-driven attractions.
Business Travel Decline: In contrast, business travel has faced a slowdown in 2025, with corporate events being postponed or cancelled due to economic uncertainty and rising costs.
- Fewer hotel bookings have been seen during weekdays and off-peak seasons due to the decline in business trips.
- As companies reduce travel budgets, hotels have been forced to adjust pricing and services to remain competitive in the corporate market.
Impact of International Travel Decline: International arrivals dropped by 3.1% during the first half of 2025, impacting overall tourism numbers, but U.S. hotels have successfully capitalized on domestic travelers.
Increased Average Daily Rates (ADR): To offset the decline in business travel, U.S. hotels have raised average daily rates (ADR) and focused on providing enhanced experiences to attract leisure travelers.
In 2025, San Diego saw a 31% surge in hotel rates, averaging $177 per night, fueled by increasing demand from both leisure and business travelers. Joining cities like San Francisco, New York City, Las Vegas, Boston, and Chicago, San Diego is supercharging the US hotel industry with record occupancy despite a broader travel decline.
Conclusion
In 2025, the U.S. hotel industry has demonstrated remarkable adaptability and resilience despite facing challenges such as a decline in business travel and reduced international arrivals. The shift towards domestic leisure travel has been the driving force behind the surge in bookings, particularly in major cities and event-driven destinations. While business travel continues to face uncertainty, hotels have effectively adjusted by raising average daily rates (ADR) and focusing on providing exceptional experiences for leisure travelers. As a result, the U.S. hospitality sector remains robust, with hotel revenues climbing, showcasing that the industry can thrive even amid travel disruptions. The overall outlook for the year highlights the importance of flexibility and innovation in meeting the evolving demands of both business and leisure travelers.