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Homestay owners hurt by price war of big hotels near Vietnam’s UNESCO Heritage site

Saturday, May 25, 2019, 21:27 GMT+7
Homestay owners hurt by price war of big hotels near Vietnam’s UNESCO Heritage site
The Son River surrounding the Phong Nha – Ke Bang National Park is seen from an aerial view. Photo: Quang Dinh / Tuoi Tre

Farmers-turned-hoteliers in Phong Nha – Ke Bang National Park, a renowned tourist area in the central Vietnamese province of Quang Binh, have been suffering from a price war between deep-pocketed hotels, who are racing to the bottom with their unreasonably low room rates.

Visitors to Phong Nha – Ke Bang National Park, a UNESCO-recognized World Heritage Site and home to Son Doong Cave, which is the world's largest, have recently been surprised by the unusually cheap prices quoted by several hotels in the area.

According to search results from online hotel booking site, room rates in Phong Nha are as low as VND30,000-50,000 (US$1.29-2.15) per night, way below the common rates of VND150,000-200,000 ($6.43-8.57) per night.

But just because accommodation cost is low does not necessarily mean tourists who love to explore the UNESCO World Heritage Site are happy.

The low pricing, instead of deeming attractive to visitors to the Quang Binh, however, is considered a disgrace to the top destination.

Anna, a Polish visitor to Phong Nha, told Tuoi Tre (Youth) newspaper she finds the dirt cheap room rates a disgrace, adding that it is unusual for lodging at such a world-class destination to be that cheap.

A screenshot of a Facebook post by a foreign visitor regarding her confusion of unsually cheap price of hotel rooms in Phong Nha – Ke Bang.
A screenshot of a Facebook post by a foreign visitor regarding her confusion of unsually cheap price of hotel rooms in Phong Nha – Ke Bang.

The race to the bottom began after the Lunar New Year in February, one of Vietnam’s busiest tourism seasons, according to local farmers who have switched from farming to tourism by turning their houses into small-sized lodging places to cash in on the increased number of visitors in recent years.

There are now more than 100 accomodation facilities in the area, and ten of the strongest players are believed to be behind the price war, according to N., an industry insider.

“There has been an intense competition in pricing among owners of major hotels in the area, where they repeatedly slash room rates to beat their rivals,” N. told Tuoi Tre.

“But small-sized accommodation facilities are those who suffer the worst consequences.”

Most of the farmers-turned-hoteliers have borrowed bank loans to build their business, which was dealt a cruel blow when the price war erupted.

T., a 37-year-old homestay owner in Phong Nha, said he could not afford payment for employee wages and bank interest with such a low room rate as VND30,000 a night.

“Big accommodation owners can survive such rock bottom prices, but not us, who built our business on bank loans,” said H., who owns a homestay near T.’s.

Vu Quang Thang, head of the market surveillance agency of Quang Binh, said he acknowledges the current price war between major hotels and understands the concerns of owners of smaller lodging places.

However, the official admitted that his agency could do nothing regarding this issue.

“Only when hotels charge their guests higher than the listed prices will the market watchdog take action,” Thang explained.

In the meantime, Nguyen Van Ky, chairman of the province’s tourism association, put the blame on the lack of cooperation among hotel facilities.

Only 11 out more than 100 accomodation facilities in the area have joined the provincial tourism association, according to Ky.

“If these establishments are members of one same association and lean on each other in their operations there will definitely be no race in lowering prices like this,” Ky said, implying that more local hoteliers should join his association.

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