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January 2006 Travel Newsletter

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  • Canadian travel news
    Map being redrawn for Canadian tourism - 2006 and beyond
    Canadian RevPAR
  • International travel news
    Australian tourism benefits from China's boom
  • Internet info
    Over 50's flock to travel websites and book
    Visitor traffic
  • Advice for the property owner
    How much rent?

Canadian travel news

Map being redrawn for Canadian tourism - 2006 and beyond
The global currents of travel are shifting, positioning Canada's tourism industry between a rapidly growing new market and a shrinking giant.
All three NAFTA economies are in decline in terms of their relative popularity as travel destinations, according to a recent report by Bank of Nova Scotia senior economist Adrienne Warren.
Canada's share of worldwide tourism receipts last year was 2%, down a percentage point from two decades earlier. During the same period, the U.S. share dropped to just over 15% from 18%, while Mexico fell one percentage point to 1.7%. Travel to Canada from the United States has also dropped sharply in recent years.
At the same time, Asia in general and China in particular are producing a growing number of new travellers, representing a potentially lucrative market for Canada.
"This is the story of tourism in Canada right now," said Bruce MacMillan, president of Tourism Toronto. "We're seeing a real paradigm shift."
The waking Asian market couldn't come at a better time for Canada, which has seen travel rates from its closest neighbour drop significantly over the past few years. Whereas overseas travel to Canada has more than bounced back from both the Sept. 11, 2001, terrorist attacks and the 2003 SARS outbreak, the number of U.S. visitors to the country through the first three quarters of last year is 30% below the 1999 peak.
Ms. Warren said the loonie's sharp appreciation against the U.S. dollar does not alone explain declining U.S. visits, since the number of same-day trips has been in decline since 2000. But growing travel from Asia isn't equally offsetting waning U.S. interest in all parts of Canada.
Ontario, which receives 83% of its foreign visitors from the U.S., likely will face more challenges replenishing tourists than Alberta and British Columbia, where Americans make up 70% and 72% of foreign visitors, respectively.
B.C. is perhaps best positioned to benefit from growing Asian travel. The province already attracts almost as many non-U.S. visitors annually as Ontario.
China is expected to grant Canada "approved destination status" in the near future, and that, combined with the recent signing of a bilateral air pact, could push Chinese travel to Canada up to 700,000 a year from 100,000. As the host of the 2010 Winter Olympics, B.C. may be set for a tourism boom.
Ms. Warren said a variety of factors account for increased Asian travel to British Columbia, including traditionally close ties between the two regions and a strong business and trade relationship. She added that the province has a large pool of manpower with the knowledge and skills necessary to market B.C. to countries such as China.
However, the B.C. industry isn't about to shift its focus away from the U.S., said Jim Storie of the Council of Tourism Associations of B.C.
"You can't afford to lose focus of your biggest partner," Mr. Storie said, adding that the U.S. is an important source of short-haul visits, where travellers spend one or two days before heading home. On the other hand, there is still uncertainty around such issues as when China will list Canada as an approved destination, he said. "I think people are geared up for the opportunities from China, but I think people aren't sure what those opportunities are."
At the same time, the tourism industry in other parts of Canada is scrambling to get a piece of the new Asian travel market. Tourism Toronto has been aggressively marketing the city abroad recently. With a keen eye toward emerging markets, the tourism board has launched websites in three Asian languages. This year, Tourism Toronto also posted a full-time employee in China for the first time. But even as Ontario's tourism industry eyes the Asian market as a means to compensate for fewer U.S. travellers, Mr. MacMillan isn't sure declining U.S. travel to Canada is going to continue in the long run. "Things can change very quickly," he said. "As an industry, we're going to have to adapt."

Canadian RevPAR
Latest lodging report (week ending December 24th) from the Canadian hotel industry showing 'revenue per available room' (RevPAR).

Province RevPAR % change
Alberta $40.16 +27.1%
British Columbia $44.93 -15.8%
Manitoba $22.47 +13.3%
New Brunswick $19.03 +13.1%
Newfoundland & Labrador $19.47 +9.0%
Nova Scotia $17.10 +30.6%
Ontario $26.64 +11.2%
Prince Edward Island $8.52 +20.5%
Quebec $34.14 +4.4%
Saskatchewan $26.13 +33.8%
Canada $31.68 +5.5%

Notes:
RevPAR is typically defined as room revenue divided by rooms available.
% change reflects the change from the previous week

International travel news

Australian tourism benefits from China's boom
Australia's tourism industry is benefiting from China's economic boom through a 17% increase in Chinese tourists.
Australian Bureau of Statistics figures show the increase in inbound visitors from China was the biggest of any country in 2005 to September, and was now on a par with Japan's. Tourism Australia's Forecasting Committee believes China will become Australia's biggest source of tourists by 2014 and will account for 13% of all tourist accommodation.
Australia was one of the first countries to get approved destination status by the Chinese Government in 1999, allowing people from some provinces to visit. This was recently expanded to include several more provinces.

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Regional News

Is Nova Scotia getting the real story on tourism?
In its 2005 Tourism Insights report, the Nova Scotia government states that occupancy rates in Halifax accommodations and the number of room nights sold so far this season are down by 2%.
Many hotel operators say those numbers don't even come close to the real picture, and they say the provincial stats seldom do.
"Our tourism business was down probably 15% to 20%, maybe more," said Seymour Trihopoylos, the general manager of the Stardust Motel in Bedford. "We've been in this business since 1999 and when business is good, the numbers are better than what we see, and when it's bad, the numbers aren't as bad."
Liberal Leader Francis MacKenzie says the Tories are refusing to give the public the real story when it comes to Tourism. "Operators are suffering, and the department of Tourism is pretending everything is great, when it clearly isn't." said MacKenzie. "I am having a difficult time finding operators that support the government statistics on tourism declines," he said. "We won't be able to correct the problem until we know exactly what we're dealing with."

Internet info

Over 50's flock to travel websites and book
More than half (54%) of British Web users have visited a travel site representing over 14 million people every month, with the over 50's market booming, according to new research.
The figures show a growth of 20% visiting travel sites in the last year alone.
Significantly, more than four in five (86%) of all British surfers aged over 50 have visited a travel site in the last year, with 1½ million of them visiting travel websites to book in September 2005.
The research found that surfers spend on average 40 minutes a month viewing more than 70 pages of content on a variety of travel sites, from airlines to cruise lines, accommodation to travel agents.
Alex Burmaster, European Internet analyst at Nielsen//NetRatings said: 'The figures for the online travel sector continue to impress but what screams out is the staggering percentage of over 50's who go online for travel. This not only has far-reaching implications for the Internet as a whole but confirms beyond doubt that the web is not just a young person's tool.'

Visitor traffic to holiday homes.canada (www.frbo.ca) & For Rent By Owner in Canada (www.FRBO.ca) web sites for the month of December 2005:
Total 'hits' for the month = 129,241 hits (4,169 per day)
Total 'unique visits' for the month = 9,642 (311 per day)
Visitors came from 80+ countries.
For more information, including an independent audit of our site performance, and to view the countries of origin for visitors click here.

Advice for the property owner

How much rent?
There are many factors which need to be considered when calculating how much rent to charge. Choosing the correct price means you get the most rent for your home without scaring away potential tenants by overpricing. Factors to consider when determining the correct price include:.... Click here for more.

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