11 June 2010 | Andy Allen

Hotel rates in some parts of South Africa fell dramatically in the run-up to the World Cup.

According to hotel search engine HotelsCombined.com, in early June some hotels were offering rooms at prices 25 per cent lower than in March and April.

In the past few days prices have risen by 5 to 10 per cent – fuelled by a sudden late rush of visitors – but are still below expectations, the company said.

Michael Doubinski, general manager at HotelsCombined.com, said: “We never expected the hotel industry to drop prices during a peak sporting event. It's most unusual that prices have dropped this significantly.

“Clearly, media reports of violence are affecting demand, which hotel chains and sole operators are reacting to in the form of competitive re-pricing.”

Doubinski said rates were falling most at the lower end of the market, particularly in the less prestigious areas of Cape Town.

Hotels in more prestigious business areas have been continuing to command premium prices, probably because of the perception that these areas are safer.

Johannesburg has been immune to the fall in demand because it is regarded as a much more peaceful city than Cape Town, Doubinski said.