THE cost of spending the night in a hotel in Edinburgh during 2017 grew around three times as fast as the UK average, according to PwC’s latest survey of sector performance.

The accountancy giant found the average daily rate increased by 10.4 per cent annually in Edinburgh in 2017, to £103.29, making the city the second most expensive place to stay in the UK after London.

The average daily rate increased by 2% annually in Glasgow, to £72.10.

The UK average rose by 3.6%, to £92.30.

“While the overall UK picture shows a hotel sector reflective of lacklustre economic growth, Scotland’s largest two cities are showing that the country remains in high demand for both tourists and business travellers,” said Claire Reid, PwC’s Head of Assurance in Scotland.

PwC noted that the fall in the pound had provided a boost to demand from international visitors for cities such as Edinburgh.

Edinburgh hotels achieved 83.7% occupancy in 2017, up from 82.1%.

The rate in Glasgow rose to 82.1% from 79.6%.

Ms Reid added: “Glasgow’s growth as a tourist destination also shines through in the data, and the city is set for a busy summer as it hosts the 2018 European Athletics Championships.”

Average daily rates in Edinburgh may be set to rise further amid official moves to attract more luxury operators to the city.

However, the fall out from the oil and gas downturn took a toll on the hotel sector in Aberdeen last year, when the average daily rate fell around 5.5% to £57.89.

The rate in London increased by 4.1% to £149.11.

Edinburgh and Glasgow have attracted strong interest from hotel operators and investors in recent months.

Abu-Dhabi-based Twenty14 Holdings bought Edinburgh’s prestigious Caledonian Hotel in January in an £85 million deal.

PwC said Glasgow is expected to add more than 1,000 new rooms in 2018 and 1,000 more in 2019, with notable demand in the area around the SSE Hydro and close to the International Financial Services District