Continental hotel rates soar

Travellers are saving pounds on low-cost air fares to European cities only to spend them on hugely inflated hotel rates. Research carried out by American Express has shown that as airfares have been driven down by no-frills airlines, so average hotel rates have gone up by as much as one third this year.

Borge Ellgaard, Amex vice-president hotel relations, said the increases were due partly to a surge in short-break travellers taking advantage of deals such as Ryanair's recent £9 offer for travel to the Continent.

Amsterdam has seen the biggest price hikes with average room rates leaping 28 per cent to £90 in the past year, followed by Bologna, Brussels, Venice, Florence and Madrid. All of these cities have seen a surge in demand following the launch of low-cost services from London airports.

'There has been a massive increase in room rates across all of Europe this year. Room supply is struggling to keep up with demand and hoteliers are taking advantage of this and putting up prices,' said Nick van Marken of Arthur Andersen's hospitality division.

Some cities have become so popular that travellers taking advantage of last-minute cheap flights may find themselves lucky to get a hotel room at all. 'In Amsterdam this August there were people sleeping in the railway station because all the hotels were full to bursting point,' added van Marken.

He said rooms were also difficult to find at short notice in Madrid, Dublin, Rome and Athens.

The research also showed that there would be fewer bargains from the low-cost airlines as the increased cost of fuel started to bite into their profit margins.

Matthew Davis, director of consulting services, said the start-up airlines were less able to absorb fuel increases than their wealthier and more established rivals. 'We are already getting feedback from clients that prices are going up. The cost of fuel has tripled over the past 18 months and we are expecting fares to rise by at least 7 per cent,' he said. 'You will still get the £9 special offers to lure people onto the website but it will become more and more difficult to actually find a cheap deal.'

Starring role for self-catering

The English Tourism Council has simplified its grading system for self-catering accommodation so that people know exactly what they are getting when they book a holiday cottage or apartment.

The existing Key scheme has been replaced by a star rating - the higher the star, the higher the standard of accommodation.

'Our main aim was to simplify what was perceived to be a complicated grading scheme. Under the Key scheme there were two components to the rating, one relating to the facilities and the other to the quality of the accommodation. We have combined the rating of facilities and quality into one single system,' said Mandy Lane, ETC's head of quality standards.

In order to achieve a star rating each property has to meet a series of minimum requirements relating to cleanliness, clear pricing and booking conditions, comfortable accommodation and good facilities.

Over 8,000 properties have been given star ratings so far. Tourist Information Centres can give local listings of graded properties and the English Tourism Council publishes a Where to Stay Guide which costs £7.99 (0870 606 7204).