Sanya tops the tourism stakes

Overseas travelers still prefer Beijing, Shanghai and Guangzhou as their first destinations when they visit China, said Chuang. Hotel owners in destinations like Lijiang city in Yunnan province have benefited due to strong demand from domestic and overseas travelers, she said.

Qingdao, the major seaport famous for its beer festival, saw an 18 percent decline in hotel rates to 653 yuan. Other double-digit fallers included Ningbo and Kunming, making them the destinations where travelers paid the lowest average rates.

Amongst the stronger performers were Dongguan, home to the world's largest shopping mall, up 18 percent to 703 yuan and Quanzhou up 15 percent to 617 yuan. Hotel rates in Beijing rose 6 percent to 709 yuan, while the neighboring city of Tianjin recorded a 1 percent increase to 621 yuan.

The new 72-hour visa policy for foreign visitors, which came into effect on Jan 1, is likely to stimulate more travel numbers, which in turn will impact prices in the future, considering that many of the leading international hotel companies are planning major expansion in China.

Five star hotels in China are still not pricey when compared to other global peers, the survey said. According to the average prices paid in yuan for hotel rooms across different star ratings in the world, the average daily room rents in Guangzhou's five-star hotels is 1,195 yuan, while in Beijing it was around 1,319 yuan. Shanghai was only slightly higher at 1,367 yuan. Among these cities, the biggest decline in hotel rates was seen in Guangzhou, with prices falling by nearly 26 percent.

Most of the domestic travelers preferred to stay in China-based hotels with an average daily rate of 655 yuan, the report said.