The number of guests at Hungarian tourist accommodation establishments fell 7.3% y/y to almost 2.6mn in August, while guest nights dropped 5.8% to 6.9mn, the Central Statistical Office (KSH) said on September 29.

Analysts quoted by Telex.hu said Hungary’s tourism sector is losing some of its competitiveness as the stronger forint pushes up the cost of accommodation, restaurants and other services for foreign visitors. Hungarian travellers also increasingly looked abroad this summer for better value, as the forint strengthened by around 10% against the euro in the first half of the year.

A record number of Hungarian holidaymakers chose Croatia for the summer vacation. Analysts opine that Hungary could become less competitive against other European destinations if prices keep rising without a similar improvement in service quality, a major factor behind the weaker results.

The summer heatwave could also have played  a factor behind the disappointing August data, according to analysts.

In the last summer months, domestic guest numbers fell 2.5% y/y to 1.4mn and guest nights dropped 2.8/  and domestic guest nights 2.8% to 3.9mn. Foreign guests accounted for almost 1.2mn arrivals and 3.1mn guest nights, down 9.3% and 13% respectively.

Foreign guest nights, accounting for the bulk of traffic at Budapest hotels fell 15%, even as the number  omestic guests increased by 8.1%. Lake Balaton, the popular summer holiday destinationsl for Hungarians saw a 3.6% drop in domestic guest numbers.

The mayor of Siofok, one of Hungary’s most popular tourist destinations, said the city had closed a weak summer season, with visitor numbers and beach revenues falling sharply. Robert Lengyel said attendance at the main beach fell by around 20%, while the Galerius spa and bath is expected to post a loss of around HUF100mn (€2.7mn) this year. He attributed the decline to high prices and weaker household finances, saying more visitors opted for free beaches, stayed for just one day and spent little in the town.

The KSH data showed that gross accommodation revenue fell 5.8% y/y to HUF152bn in August.

In January-August,  tourist accommodations recorded 13.4mn guests, down 0.9% y/y. Domestic guest numbers increased 1.0% to nearly 7.0mn, while foreign arrivals fell 2.9% to 6.4mn.