The number of American visitors to the UK has slowed since the start of 2025, with the weaker dollar dampening hotel room rate growth, particularly in London, according to CoStar.
VisitBritain stated that the US is one of the UK’s most valuable inbound markets, contributing an estimated £7bn in 2024.
American travellers accounted for 15% of total international overnight stays last year, with longer average trips and higher per-visit spending than other markets.
But data from the US International Trade Administration shows arrivals have eased in recent months.
Analysts suggest the slowdown reflects a softer dollar, the impact of new tariffs imposed by US president Donald Trump, and increased competition from continental Europe as flight connections improve.
Although demand for Europe overall remains robust, the UK has seen weaker inflows outside peak holiday periods. This contrasts with 2023, when major events such as Taylor Swift’s stadium tour boosted visitor numbers.
The exchange rate shift has also reduced hotels’ ability to increase rates for US visitors. Between mid-July and mid-August, average daily rates (ADR) in the UK rose 1.4% in pound terms but nearly 6% in dollar terms, making stays more expensive for Americans.
London hotels have been most affected. In the four weeks to 16 August, ADR in the capital stood at £201, down 0.6% year-on-year, while in dollar terms the figure equated to a 4% rise.
CoStar stated that this trend highlights the limits on pricing power in the capital, where competition is strongest.
It added that while the summer has been supported by events and tourism demand, the remainder of the year could be more challenging.
CoStar said: “Although the summer is proving to be a bright spot in hotel performance across the UK, supported by various events, the latter part of the year could remain difficult. Given the tariff impact on consumers across various global regions, consumer price sensitivity is being felt at a global scale.
“This is likely to impact discretionary spend for international visitors coming to the UK, limiting ADR improvements, most notably outside of holiday and event periods. Compounded by the economic backdrop at home, hoteliers will need to continue to be nimble in adapting their revenue strategies to support the bottom line, which continues to be strained as inflation ticks upwards.”
