A report on the prospects for world travel costs in 2015 suggests that Australia can expect lower air fares, higher hotel prices and more expensive car hire.

The report, from the business travel specialist Carlson Wagonlit Travel (CWT), compares price expectations in regions across the globe during the coming year.

Globally, air fares are expected to rise by 2.2% and by 0.5% in the Asia Pacific region.

However, air prices in Australia are projected to fall  by 1.1% in 2015 under the pressure of increased competition and record low load factors, says CWT.

Hotel prices in the Asia Pacific region are expected to grow 2.7% in 2015, following record high occupancy rates in 2013 driven by demand from leisure and business travel.

Markets such as Sydney, the report says, are currently experiencing occupancy rates above 80%.

“We expect relatively strong price growth (3.6%) in Australia, driven by rising demand in Sydney, Melbourne, and Darwin,” says CWT.

Turning to vehicle rental, the report predicts that prices will rise 1% in Australia and New Zealand.