Recently, many travelers planning trips to Japan have expressed frustration: hotel prices have surged, yet service quality fails to meet expectations — with some saying it now lags behind hotels in China.
Despite these concerns, Japan continues to attract large numbers of tourists, thanks to its unique cultural appeal and relaxed visa policies. The ongoing 2025 Osaka Expo is expected to further fuel travel demand.
From January to April 2025, Japan welcomed a total of 14.45 million visitors. At this pace, annual arrivals could surpass 40 million for the first time.
However, hotel supply has struggled to keep up. Although new properties open each year, demand far outpaces availability.
According to local industry insiders, during Japan’s recent Golden Week (April 26–May 6, 2025), the average room rate in Osaka rose by about 40% compared to the same period last year. Kyoto saw a 20% increase as well.
Beyond supply-demand imbalance, inflation is another key driver of rising hotel prices. With Japan's cost of living steadily increasing, hotel are facing higher operational expenses from food and utilities to labor.
The latest data from Japan’s Ministry of Internal Affairs shows that the core Consumer Price Index (CPI) in April rose 3.8% year-on-year, exceeding the Bank of Japan’s 2% inflation target. Food prices alone jumped by 7.2%, marking the highest increase in 40 years.
To remain profitable, hotels have been forced to pass on these rising costs to guests. Recent figures show the average nightly rate at major Japanese hotels has reached around RMB 812 (USD 113), up roughly 40% from 2019.
Traditionally, Japanese hotels were renowned for their attentive and meticulous hospitality. So called “Japanese service” was a key draw for many international travelers. But today, many tourists feel that level of service is no longer guaranteed.
A Tokyo-based recruitment agency reported that the average annual salary for hotel employees is just RMB 179,000 (about USD 25,000) — significantly lower than in many other industries.
This makes it hard to attract and retain skilled workers, resulting in high turnover and insufficient training, which in turn affect service quality.
