Budget travel booms as hostel bookings jump by 14 percent

While luxury and business-class hotels are doing everything they can to eke out a break-even balance sheet in this red-ink economy, there's one travel category that has seen a boom in bookings. A mighty boom, in fact. Hostelling International, one of the most important operators of affordable international accommodation, say that in 2008, annual bookings shot up by a whopping 14 percent.

Hostels have long one of the travel world's most neglected categories, partly because Americans don't live in a culture that values travel much. But nearly every other Westernized society does, and if you grew up in Australia or continental Europe, it's nearly a cultural expectation that you take some time in your 20s to roam the planet and see how everyone else lives. Those nomads on tight budgets have been the lifeblood of hostels.

That is, until the economy crashed. Now, vacationers of all income brackets and ages are turning to them. And it makes sense. At many hostels a bed costs around $20 a night, so booking at a well-run hostel instead of a $300-a-night luxury hotel can suddenly make a dream trip possible.

Conventional wisdom would have you believe that under the circumstances, most people would be staying home, or at least close to it. Yet it would seem that people aren't staying home; they're just spending their budgets more wisely. Hostelling International, which standardizes its properties in some 80 countries, reports that overnight bookings in 2008 were worth some $31 million. That's a whole lot of visitors. HI says it equals about 1.4 million overnight stays.Sure enough, the biggest increases came in the most expensive countries, including the United States, France, Switzerland, and Belgium. In England and Wales, where the exchange rate was particularly brutal last year, bookings skyrocketed by 31%. Interestingly, HI also says that Spaniards book hostel beds at a higher rate than people from any other nation.

Those numbers aren't nearly the whole story. Thousands of other, independent hostels aren't associated with HI or its statisticians and they also stand to benefit from the new frugal economy.

Lots of Americans think of a hostel as the equivalent of a flophouse, but the modern reality is miles from that notion. Hostels, like most other products, have to closely follow the expectations of the market, and these days you'll find ones with Egyptian cotton sheets, women-only sections, key-card doors, and fitness facilities. I have spent many months' worth of nights at hostels around the world, both in dorms and in private rooms, and I extolled their value on this blog last month.

Just a few weeks ago, hostels were considered one of our "Unusual Ways to Save Money." But these numbers prove that the hostel method isn't so weird after all. If it means that more Americans will be treating themselves to international travel, I'm all for making more room in the dorms. The sooner our national passion for insularity ends, the better for all of us.

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