Income from hotels and tourist developments in the Algarve rose 5,7% in June, despite the decrease in both the occupancy rate and the number of overnight stays, compared to the same month in 2017. Figures that, for the president of the Tourism Region of Algarve, attest that «demand is recognizing the quality of the Algarve and willing to pay more».
The National Institute of Statistics (INE) released this Monday the monthly report on tourism activity in Portugal, in June 2018. And what the INE's figures reveal, but also those released by the Hotel Association of Portugal (AHP), is that, even with less overnight stays, the Algarve hotel industry is managing to make more money.
João Fernandes considers «the 5,7% rise in income very significant» and devalues the decrease in the number of overnight stays. This is because the term of comparison is 2017, «the year of all records». "Compared to 2016, which was a very good year, there were 387 more overnight stays between January and June [1st Semester]," he told Sul Informação.
From the hoteliers side, the same message also arrives. "This year, it's going to be better than 2016 and a little below 2017," said João Soares, regional delegate for the Algarve at AHP.
“There are very different realities. There are large groups in the Algarve, with some substantial breaks and other smaller units that are performing equal to or better than 2017. There are several companies remaking their budgets, taking 2016 as a comparison term and considering 2017 as an extraordinary year» , revealed.
The figures for June, now released by INE, indicate a strong decrease in overnight stays from foreigners in the Algarve – 7,1% less, which represents less 127 thousand overnight stays. In the first half of the year, the year-on-year change was not so pronounced, with a drop in the number of overnight stays from non residents of 3,7%.
Residents manifested an opposite trend, with the number of overnight stays by national tourists increasing significantly in June (another 8,5%). In the accumulated between January and June, the increase was 6,3 percent.
The president of RTA stressed that the June numbers "are in line with what has been seen since the beginning of the year" and are a sign that the Algarve "is growing in value and building loyalty in demand resulting from an abnormal cycle advantageous, which has happened in recent years».
João Soares, in statements to Sul Informação, warns of the need to "find the right position", bearing in mind that there are several factors that are contributing to a decrease in demand in the region.
“There is the opening of Turkey, which is a very difficult market to fight, because it also has a lot of quantity and quality, there is the Mediterranean, a very good offer and very low airport taxes, almost non-existent. There was also the bankruptcy of Monarch and Air Berlin, which caused fares from England to the Algarve to increase substantially», he illustrated.
This means that the Algarve «has a very big challenge ahead», that of finding its place in this situation. “We cannot compete, in terms of luxury, with the South of France, Ibiza or Greece, nor with Turkey, in terms of quantity. We must continue to invest in requalification” and in improving the product offered, he defended.
This year, there has been an increase in prices, which has enabled the good economic performance of the Algarve's hotels. But, in João Soares' view, this increase must happen in a thoughtful and justified way. «You have to pay close attention to the Value for money. There are, in fact, products that are worth the money being asked for and others that are not”, he believes.
In other words, «those who have not remodeled, have not updated their products and have not improved, obviously cannot substantially increase prices, just because there is demand».
«The customer doesn't mind paying more, as long as he has everything good: the mattress, the bed, the shower, the wi-fi, the spa. The value is not expensive, what is needed is for the product to be improved», believes João Soares
“In the crisis years, prices dropped significantly. Now, the Algarve has repositioned itself at its level, given the quality it presents. The sustainability of the hotel units cannot be guaranteed with low prices», said, for his part, the president of RTA João Fernandes.
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