Just like with flights, booking a hotel at the "right time" might help you save big on accommodations.
Many travelers have experienced the frustration of booking a hotel at a rate that they feel is reasonable, only to see a lower rate advertised by the same hotel—for the same dates and room category—after they book.
Like most travel companies, hotels price their product on a dynamic model—that is, rates fluctuate with demand and other market drivers. The trouble is that consumers don’t have visibility to market forces the same way hotels do, so getting the best price on a hotel room can be a guessing game.
So, is there a best time to book to get the best rate on a hotel room? There can be, but not always. Read on for more detail.
Understanding Hotel Rate Types
There are generally two types of rates at hotels: prepaid rates and postpaid rates. A prepaid rate is paid in advance, like a plane ticket. These rates are typically lower than postpaid rates and can require a deposit at the time of booking, either for the estimated total of the entire stay or for the first night’s room and tax. Prepaid rates can sometimes be canceled for a refund or partial refund before arrival, while sometimes they’re nonrefundable and non-changeable at the time of booking.
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Postpaid rates are typically slightly higher but carry with them added flexibility. Many postpaid rates can be canceled without penalty, often up until a day or two before arrival.
Booking a Room in Advance
Brendan Abraham, general manager at the Bellyard Hotel in Atlanta, Georgia, says, “Be sure to book in advance for the best rates. In most instances, hotels will increase their rates as they approach the two-week arrival.”
It makes sense to book postpaid rates in advance to secure the space, and if rates go down, reservations can be canceled and rebooked without penalty. During high-demand periods, booking far in advance can ensure space is available at any rate if the hotel is likely to sell out quickly.
Rebook When Rates Fall
Daniel Borkowski, the area director of revenue management for InterContinental New York Barclay, recommends booking far in advance but continuing to monitor for sales. “The best time to book would be about six months out. As hotels price, they are likely to identify and anticipate slower dates further out and price them at a discount.” Guests who have booked flexible rates will be able to cancel and rebook at the lower rate, but guests who are already locked into non-refundable rates won’t have the ability to make changes.
Be sure to pay attention to rate rules when booking. When not booking directly with the hotel, nonrefundable prepaid rates are even more rigid because they typically involve hotel inventory sold to a third party at a steep discount, with significant restrictions on the cancellation or change to a reservation.
The best advice here is not to book a prepaid or nonrefundable rate unless you’re absolutely certain that both the property and the rate are the best options, and that won’t change before arrival.
When to Check Back
For both prepaid and postpaid rates, it makes sense to double-check the rates for the same stay dates and room category up until the cancellation deadline. For the most flexible rates, it makes sense to check some of the common cancellation deadlines on other prepaid rates, as hotels will sometimes adjust pricing once more reservations have passed the deadline and are then nonrefundable or incur higher penalties.
Consider Travel Insurance
Travel insurance can give travelers more confidence to book nonrefundable rates far in advance.
Prepaid, nonrefundable hotel rates often have pretty rigid restrictions, and exceptions aren’t common. When booking far in advance and paying upfront, consider purchasing travel insurance to cover any cancellation fees or nonrefundable payments in the event you’re unable to travel. Situations vary, but for cancellation, policies often cover several reasons ranging from death to significant illness to job loss. Also increasing in popularity are “Cancel For Any Reason” policies, which provide near-full reimbursement for travel plans that are canceled even for reasons outside the typically covered list of reasons.
Consider Seasonal Fluctuation
Sebastian Hinsch, the general manager at Four Seasons Hotel Seattle, suggests guests check seasonality for the hotel they’re booking. “Timing matters if you are trying to book a high-demand period. The earlier, the better in order to secure the specific room type and dates you are looking for.” In Seattle, summer is peak season, so rates tend to trend higher further out.
During higher demand seasons, hotels tend to keep rates higher further out to ensure that rooms don’t sell out too quickly. Closer to the stay dates, revenue managers review how quickly the room inventory has been booked, and adjust rates accordingly.