Despite lower demand levels, hotel room rates have hit a record high, with Western Australia proving to be the nation's third most expensive.
According to data from the Australian Bureau of Statistics for the first quarter of 2008, revenue per available room (RevPAR), which is the industry benchmark for hotel trading performance, recorded a growth of 5.6 per cent to reach an all time high of $91.31 across the country.
Meanwhile hoteliers in Perth continue to reap the benefits of a robust trading environment.
"A slight increase in Perth's room supply saw occupancy levels retract to 82.9%, however with occupancy levels amongst the highest in the country this is not a concern," Executive Vice President, Jones Lang LaSalle Hotels, Tony Craig said.
He added, "With very limited new supply expected to come on line over the next two years, we expect Perth to continue to see strong ADR (average daily rates) growth on the back of occupancy levels near or at full capacity."
Significant ADR growth of 16.2% throughout Perth saw RevPAR increase by 14.6% to reach $123.16.
In contrast, Sydney had an occupancy rate of 85.3 per cent with RevPAR up 5.8 per cent to $165.34, while Melbourne's occupancy rate was at 81.7 per cent with RevPAR at $149.85.
The highest climber in occupancy rates was Darwin, up 8.8 per cent with RevPAR jumping 18.3 per cent tp $67.40.
