Hotel accommodation in London have dropped significantly over the last couple of months as hotel owners compete for a decreasing number of visitors.

A recent report conducted by Pricewaterhouse Coopers has said that hotel prices have slumped by 8.1 percent during the last year. Room rates for London accommodation, one known to be one of the most expensive cities to stay in the world, now stand at about £10 lower than in the same period last year.

The dropping prices are attributed to the current economic situation that has especially hit the business travel industry to the city. Cheaper room rates have brought in more holidaymakers and holiday tourist numbers have gone up in the last few months, however, the rise has not made up for the drop in business tourists.

In spite of this, hotels in London can still look forward to better times, thanks to the 2012 Olympics. While the event is still two years away, many hotels are already receiving bookings for the event.

Estimated tourists numbers forecasted for during the Games are likely to be approximately 500,000. The Olympics will be held between July 27 and August 12, 2012, with hotels already expecting a significant influx in tourists during this period. Many hotels will increase bed numbers and some considering splitting rooms to provide even more accommodation.

Meanwhile, some hotels are considering other options like renting out rooms and apartments near the hotel.