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Travelers saw prices fall for big-ticket pieces of their vacation budgets in July, offering at least a temporary reprieve after soaring costs earlier this year.
Airfares fell nearly 8% from June to July, while prices for rental cars and lodging such as hotels declined 9.5% and about 3%, respectively, according to a monthly inflation report issued Wednesday by the U.S. Department of Labor. It was the second consecutive month of price declines for each category.
“That’s really good news, I think, when people are planning out their vacations,” said Sally French, a travel expert at NerdWallet.
Airline ticket prices peaked in May this year, driven by factors like elevated consumer demand coming out the Covid-19 pandemic and operational issues for airlines such as high jet-fuel costs and staffing shortages, which led companies to pare back flight schedules, according to experts.
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That surge in airfare earlier in 2022 was “anomalous,” said Hayley Berg, lead economist at Hopper.
Hotel and rental car prices also topped out in the spring, while high gasoline costs also served to stretch road-trip budgets.
Thirty-nine percent of travelers said the general cost of trips being too expensive deterred them from traveling more than they would have otherwise preferred in the past half-year, according to Destination Analysts, a tourism market research firm. Almost half, 47%, explicitly cited gasoline costs and 27% did so for airfare.
Financial concerns compounded other travel headaches over the last several months, such as an increase in lost baggage and delayed or canceled flights.