Right after the National Day holiday, hotel prices in Xi'an have dropped to as low as 1 yuan?
It is widely acknowledged that hotel prices will drop right after the 7-day National Day Golden Week, which has become an unspoken iron rule in the hospitality industry. However, the price cut of this hotel in Xi'an is incredibly drastic.
Hospitality Finance & Economics came across a news report the other day: a 4-diamond hotel near Xi'an Bell Tower is priced starting from 1 RMB, rooms that were sold for over 600 RMB during the National Day holiday are now offered at a steep fire-sale price, which leaves no room for peers to make profits, and even sacrifices all its own opportunities to earn revenue.
Leaving aside the question of whether this 1-yuan hotel is just a marketing gimmick, this incident easily makes people wonder if Xi'an's tourism has lost its popularity? Otherwise, why would hotels be forced to make such "suicidal" price cuts?
On the contrary, just one week before the price cut, the occupancy rate of hotels in Xi'an reached as high as 92%, and the occupancy rate of star-rated hotels increased by 6.8 percentage points year on year, with all rooms in core areas fully booked every day.
The number of overnight tourists has increased, the average length of stay per tourist has extended, and nighttime consumption has also been boosted. Logically speaking, hotels should be able to make easy profits, but why are they so eager to "attract guests at all costs" as soon as the holiday ends?
Occupancy Rate Has Been Stabilized
But Hotel Prices Have Not Followed Up
During this year's National Day holiday, Xi'an's cultural tourism market maintained high-level operation with extremely high popularity.
Over the 7-day National Day holiday, Xi'an received 18.988 million tourist visits, representing an 8.08% year-on-year increase at comparable calibers; total tourist spending reached 18.605 billion RMB, marking a 6.53% year-on-year rise at comparable calibers, and the growth momentum exceeded expectations.
It is worth noting that the permanent resident population of Xi'an is about 13 million, which means that the number of tourists received during this single holiday is 50% more than the total permanent resident population of the whole city.
According to big data from OTA platforms, the online popularity of Xi'an's cultural tourism during the National Day holiday steadily ranks in the top tier across China. Data from Meituan Travel shows that Xi'an ranks the 2nd among popular long-distance travel destination cities, with the number of consecutive hotel stay orders rising by 31% year on year. Data from Tongcheng Travel shows that Xi'an is listed in the TOP10 of national overnight travel destinations.
However, "more people staying in hotels" does not seem to equal "hotels can sell rooms at good prices".
The above set of data shows that the growth rate of tourist volume (8.08%) is much higher than that of tourist spending (6.53%). As the largest part of travel expenditure, the accommodation sector naturally follows the same trend.
There is a very contradictory contrast: the occupancy rate of hotels in Xi'an reached as high as 92% during the National Day holiday, but data released by the UrCove brand shows that the average price of hotels in Xi'an and the number of reservations per single hotel decreased slightly year on year.
Not only during the National Day holiday, data released by Houhai shows that in the second quarter of this year, the comprehensive prosperity index of Xi'an was -31. Among all indicators, the average room price is the most pessimistic expectation in Xi'an's hotel industry. Statistics show that the average room price prosperity index of Xi'an is only -31 (the national average is -17).
Looking at the operating data of local hotels, the operating data disclosed by Xi'an Tourism in May this year shows that the average room rate of the company's hotel business continued to decline from 2023 to 2025, dropping from 343.18 RMB to 239.31 RMB, a decrease of about 30% in two years.
The company explained in the announcement that the decline in average room rate is affected by factors such as market price competition, consumption changes, and the increase in the proportion of its own mid- and low-end hotels.
We cannot say that the entire hotel market in Xi'an is in this situation, but it at least reminds us of one thing: fully occupied rooms do not mean that hotel owners can get rich returns; when the occupancy rate goes up, the revenue per available room does not necessarily go up accordingly. As long as the price is low enough, hotels can always grab orders.
Many people have a fixed impression that hotels in tourist cities that cannot make money are mostly far away from scenic spots, with inconvenient transportation and poor geographical locations. Tourists will frown just by looking at the map, let alone choose to stay overnight.
But the hotel that sells rooms starting from 1 RMB mentioned above is a 4-diamond hotel located near the Bell Tower. This location is self-evident: it is one of the city landmarks of Xi'an and the most core tourist business districts.
If these high-quality hotels have already launched such price wars, we can clearly feel the fierce competitive pressure among local hotels.
Can Tourist Growth Keep Up With The Surge Of Hotel Rooms?
The incident of the 4-diamond hotel near the Bell Tower selling rooms starting from 1 RMB essentially stems from the increase on the supply side, and hotels have to take the initiative to cut prices to retain guests.
There may be traces of gimmicks and marketing in this incident, but the root cause lies in the supply side.
The popularity of tourism in Xi'an has continued to rise in recent years, which will inevitably lead to the expansion of the hotel accommodation industry. The question is, does the supply growth of the local hotel industry truly match the market demand?
On the demand side, Hospitality Finance & Economics believes that the real situation of Xi'an's hotel market is far more resilient than that of most traditional tourist cities.
On the one hand, as the largest city in Northwest China, its business travel resources are unquestionable. The common problem of many traditional tourist cities is the extremely obvious contrast between peak and off seasons. But Xi'an is different: it is the administrative center, business center and transportation hub of Northwest China. Business travelers, government travelers and transit travelers form a relatively stable off-season demand, so that hotels in Xi'an will not fall into a freezing point even in non-holiday periods.
On the other hand, the richness of tourism resources in Xi'an is beyond the reach of many other tourist cities. As an ancient capital with a history of thousands of years, Xi'an is not a city that tourists can finish visiting and leave within one day. Terracotta Army, City Wall, Giant Wild Goose Pagoda, Datang Everbright City, Muslim Street, Shaanxi History Museum... The "special forces-style" quick check-in tour does not work here. After all, the 92% occupancy rate during the National Day holiday is achieved by nearly 20 million tourists through in-depth experiential overnight tours.
However, the supply growth of hotels in Xi'an may be even more drastic, which leads to periodic "excessive heat" in the market.
The 2025 Xi'an Hotel Industry Human Resource Supply and Demand Report shows that by 2024, Xi'an had 9,495 hotels of various types with 354,157 rooms, including 1,107 chain hotels.
In 2025, the total number of operating hotels in Xi'an has exceeded 10,000. In just two years from 2024 to 2025, about 1,400 new hotels opened in the city.
This means that nearly two new hotels open in Xi'an every day. From 2020 to 2025, the number of homestays around core scenic spots in Xi'an surged by 300% year on year, and the total number of homestay rooms in the city exceeded 100,000.
The rapid increase in the number of hotels will inevitably lead to the situation of "too many wolves chasing too little food". In order to compete for market share, all kinds of business wars will break out in turn. The Xi'an Homestay Industry Association issued a document in March this year stating that 90% of homestays in Xi'an fell into price wars and transfer waves in 2026. A local hotel owner admitted that his newly renovated store in 2024 has never been fully occupied in 2025, and the group quotation now is even lower than that in 2019.
The 2026 Q3 China Hotel Market Prosperity Survey Report released by HVS Hotel Consulting shows that Xi'an's comprehensive prosperity index is -36, and the expectations for accommodation rate and average room rate are relatively cautious.
The report clearly points out: "The continuous new supply diverts the existing guests, and the continuous entry of new hotels further intensifies market competition".
In core business districts such as the Bell Tower, Giant Wild Goose Pagoda and Muslim Street, the density of homestays is as high as that of convenience stores. You can find more than a dozen homestays with similar decoration and similar names within a 5-minute walk, which fully demonstrates the fierce competition.
It is easy to get into the business but hard to get out.
In the early stage of cultural tourism recovery in 2023, the transfer fee of a homestay in the core area of Xi'an could be as high as 300,000 to 500,000 RMB; by the end of 2025, no one was interested in homestays with a transfer fee of 100,000 RMB, and even extreme situations such as "free decoration and subsidized rent" appeared.
Xi'an Hotel Market
"Everyone Who Enters The Market Will Have A Tough Time"
How fierce is the competition in Xi'an's hotel market? Local hotels struggling in the red ocean are the most intuitive proof.
The 2025 performance data of Xi'an Tourism Group, which is on the verge of delisting, shows that the attributable net profit suffered a huge loss of 291 million RMB, and the core reason is exactly the double decline of occupancy rate and room price in the hotel and homestay sector, which cannot cover the fixed costs.
Although the root cause of Xi'an Tourism's dilemma lies in its own problems, and market changes are only external factors, the Xi'an hotel market has no obligation to take the blame for it.
But this also proves that even the strong local cultural tourism enterprises cannot easily cope with the market challenges, let alone the individual hotel and homestay owners.
Some netizens commented that in Xi'an's hotel market, everyone who comes in will have a tough time.
There is also the "no-show" of luxury hotels. The Four Seasons, The St. Regis and Waldorf Astoria hotels in Xi'an, which were originally scheduled to open in 2026, have been postponed collectively. Although the problem mostly lies in the property owners and has little to do with the performance of the local hotel industry.
However, industry insiders began to reflect on "whether there is an oversupply of luxury hotels in Xi'an". Such concerns are not groundless for Xi'an. At present, the high-end hotels that have opened in Xi'an include The Ritz-Carlton, Sofitel Legend, InterContinental, Grand Hyatt, JW Marriott and W Hotel.
Among the hotels to be opened, in addition to the above-mentioned luxury brands, there are Park Hyatt Xi'an, Kimpton Hotels Xi'an, LXR Hotels & Resorts Xi'an, etc. In the past signed agreements and market rumors, there are also The St. Regis, Andaz, Banyan Tree, Conrad and so on. The number is really large, which matches the status of Xi'an as "the largest city in Northwest China".
However, China's hotel market has now taken the lead in transforming from the "incremental development era" to the "stock asset management era", and this trend has gradually emerged in cities like Xi'an.
On the one hand, signing and implementation of new hotels are still ongoing, and the supply of luxury hotels will only increase in the future. For the players that opened earlier, their seniority has become a pressure instead of advantage;
On the other hand, with the rapid changes in consumer demand and the complex and diverse experience demands of the new generation of consumers, the product form and service mode of traditional hotels can no longer meet the needs of the new generation. How to revalue assets is an unavoidable issue for high-end hotels in Xi'an while pursuing quantity expansion.
However, a positive change we can see in Xi'an's hotel market is that with the official opening of the Xikang High-speed Railway this National Day holiday, Xi'an's hotel and tourism market has also ushered in a new round of growth opportunities.
In the past, people "traveled to Xi'an", but in the future it may become "traveling to various destinations starting from Xi'an". In the past, Xi'an was only a tourist destination, but now Xi'an is not only a destination, but also a tourist hub for more people.
The Xikang High-speed Railway attracts a large number of tourists to Xi'an, and the next problem that hotels in Xi'an need to solve is "how to retain these tourists".
For example, modernized operation, new management modes, culture + art, IP mining... As a thousand-year ancient capital, Xi'an is also the largest modern central city in Northwest China, and an international metropolis clearly designated by the state for construction. The city that combines ancient charm and modern vitality has far more potential to explore.
But at least, the "1-yuan hotel" strategy is definitely not a viable solution.
This article is from the WeChat official account "Hospitality Finance & Economics", the author is Xue Yang, and it is republished with authorization from 36Kr.