Why Hotel Prices Fluctuate—and How to Time the Best Rate

Do hotel prices fluctuate? Anyone who's ever booked that perfect hotel at the this-can-not-possibly-be-true price point can attest that they do. Too often, we go back to finalize our booking only to see that the bottom line is now significantly higher than it was just a few days or even hours before. 

What gives? And, more to the point, how can you protect yourself and get the best deals on accommodations? One way is to book directly, as opposed to using an online travel agency (OTA). Hotels pay online travel agencies large commissions to appear on their sites, so hotels are forced to raise their prices to turn a profit. It also helps to know when to book and what factors contribute to the surprise price surge we all dread. 

Let's jump into what causes hotel prices to fluctuate and how you can score the best prices on your dream accommodation.

Do Hotel Prices Fluctuate?

Yes, hotel prices do fluctuate. These markups can cause stress and uncertainty for travelers, especially if you don't understand when or why they occur. According to Phocuswright, the hotel sector experienced a boom after the pandemic, leading to increased demand and, subsequently, higher hotel prices.

There is a bright spot for travelers, though. As growth leveled off in the years following the pandemic and more competition emerged in the form of short-term rentals, hotels had to adapt. During the pandemic, travelers preferred short-term rentals, but this preference is waning. Even so, personalized service, good deals, and unique experiences are now expected components of the hotel package that travelers seek.

Reasons Why Hotel Prices Go Up and Down

There are several reasons why hotel prices go up and down. Understanding these causes and how you can overcome them will keep you and your bank account happy.

Supply and demand

Simply put, the higher the demand, the higher the prices. Room rates spike during high tourist season and festivals or special events. According to Travel & Leisure, booking one to two weeks in advance for domestic travel or a few months in advance for international travel can give you more options and better rates. 

Consider the demand when booking your accommodation. Sometimes, during low-demand periods, waiting until the last minute to book can work in your favor as hotels scramble to fill rooms. However, this doesn’t work when demand is high. Instead, you'll likely find yourself with ultra-high prices. 

Seasonality

Seasonality has the most significant impact on supply and demand, and it fluctuates by destination. For example, summertime hot spots like Paris and Barcelona see a significant uptick during the warmer months, while you'll find the opposite in Thailand. The cool season, between November and February, is the high season there. 

Events and holidays

Events, holidays, and major festivals also cause hotel prices to fluctuate. For example, during the 2024 Summer Olympics in Paris, the city center’s short-term rentals and hotel prices jumped astronomically. 

One way to manage the predictable price jump during holidays and events is to stay just outside the city center and commute in for the festivities. 

Location

Want to be right in the middle of the action? A prime location comes with a price tag. The chicest neighborhoods often have the highest demand, and prices rise accordingly. 

You can work around the location situation in a few ways, such as staying outside the city center but on a metro line for easy access or booking a more modest hotel that's in the area you want to be, albeit with fewer amenities.  

Competition

Now for some good news: more competition means better rates for travelers. Many hotels use a pricing model that compares their rates to those of their competitors, which will keep the rates low. 

In some cases, instead of lowering rates to match the competition, hotels will up the luxury factor or add special perks. These benefits are another win for you and contribute to a more enjoyable experience. 

Booking timing (early, last-minute, and length of stay)

Knowing when to book your hotel can be a very tricky business. Wait until the last minute, and you can score deals as hotels try to fill empty rooms, but sometimes, when demand is high, you'll find yourself faced with a ballooning rate. 

There is no one-size-fits-all solution, but here are some key points to consider.

• For the most part, there is less demand during the week than on the weekends.

• If you're booking during the low season and there are no special events happening, booking at the last minute can save you money.

• You can generally get a better day-by-day rate the longer you stay.

Room type and amenities

Looking for a room with a beautiful view and in-suite jacuzzi? You'll pay more for it. 

If luxurious accommodations and top amenities are truly important to you, but you want to save money on the rate, consider traveling during the off-season or choosing a location farther away to offset the cost.

The platform you're booking on (online travel agency vs. direct booking)

You'll almost always save money on room rates when you book directly, even if the price looks comparable or lower through an online travel agency. 

This is because online travel agencies often add hidden fees at check-in or check-out, which add up quickly. If you've ever booked a sweet deal on Expedia or Agoda only to find out there's a price bump at the counter, you're not alone. It happens frequently and can significantly impact your overall cost.

Additionally, the hefty commissions hotels pay to be listed on online travel agency platforms often mean that they inflate their prices to make a profit. Book direct, cut out the middleman, and save yourself the padded cost. DirectBooker is working to make this even easier by integrating verified direct rates into conversational AI tools, so travelers can compare options and book confidently without OTA markups.

How Online Booking Platforms Influence Prices

Online travel agencies influence prices through various methods, including price discrimination and the use of hidden fees. Those stacked prices are the tradeoff for using a platform that lets you compare different hotels instantly. Let's break down how it all works.

Hidden fees and no personalized service

As mentioned above, hotels pay online travel agencies a commission for each booking, each click, or to be featured prominently in search results. 

As such, you'll find inflated rates and hidden fees. Additionally, online travel agencies don't offer discounts, promotions, or member benefits when you book on their sites. There are no price-matching guarantees and no special white-glove service that caters to your needs. 

Price discrimination 

Price discrimination is a tricky concept, and online travel agencies frequently employ it. Rates can and will vary depending on the currency you use and where you search from. 

Essentially, online travel agencies charge different rates to specific individuals based on factors such as geography. Sure, you can kind of cheat the system with a VPN, but it doesn't always work.

If you book directly, you’ll notice that hotels generally do not use price discrimination to inflate prices.

Booking Hotels Directly vs. Using Online Travel Agencies (OTAs)

While booking hotels directly offers better pricing, more transparency, and personalized service, online travel agencies provide an instant comparison tool with a snapshot of the options available in the area.  As travel search moves toward conversational AI, more travelers are looking for ways to combine the convenience of OTAs with the savings and flexibility of booking direct.

Booking directly

Booking directly supports local businesses and gives you more control over your experience. Here’s more on booking directly:

Pros:

• More reasonable prices and access to discounts and deals.

• Hotel loyalty points with perks, upgrades, and free nights.

• There are no hidden fees and flexible booking and cancellation.

• Personalized service and the ability to customize your stay as needed.

Cons:

• It's much more time-consuming to compare hotels directly, , though emerging AI-powered tools like those being developed by DirectBooker are making it easier to access verified direct rates and hotel details in one place.

• Online travel agencies usually offer a map of the hotel locations, which is helpful for booking in unfamiliar cities.

Booking through an online travel agency

Online travel agencies provide a quick list of options, allowing you to compare rates and locations, but they also come with a few key drawbacks. 

Pros:

• Instant comparison tool.

• Interactive map of where the properties are located. 

• Some online travel agencies offer additional services, such as car rentals in the same booking engine.

Cons:

• Hidden fees and lack of customer service.

• It is difficult to change a reservation, cancel, or request special amenities.

How to Get the Best Hotel Rate When You See Fluctuating Prices

Fluctuating hotel prices are an unfortunate part of traveling, but you can manage them with a few easy steps. 

Book directly

By booking directly, you can access perks, loyalty programs, and deals. Sometimes, you can even negotiate with hotels based on other pricing in the area. Many hotels also offer price matching, also known as “best rate guaranteed.” If you find a better deal on an online travel agency and can provide proof, the hotel will match the lower price. Just ask what the price-matching policy is, and be prepared to provide your receipts.

DirectBooker represents the next evolution in travel booking, combining real-time comparison with the ability to book directly through conversational AI tools. Soon, travelers will be able to ask for verified direct rates, compare hotels instantly, and complete their booking through integrated AI assistants, all without OTA markups or hidden fees.

Time your booking

Timing is everything, and it will help you get a better rate on your hotel. 

Book ahead if you're traveling during the high season or a special event. Book last minute if you know demand is low. Consider traveling during the week instead of the weekend.

Ride the Hotel Price Fluctuation Wave Like a Pro

Understanding how the hotel industry works is the first step to dealing with surging prices and knowing when to book. Keep seasonality, demand, and competition in mind when deciding on accommodation, and book directly for the best deals and amenities.

Sources

• Deland, Ashley. “Understanding Pricing Strategies, Price Points and Maximizing Revenue.” Forbes, Forbes Magazine, 13 Aug. 2024, www.forbes.com/councils/forbesbusinesscouncil/2022/08/22/understanding-pricing-strategies-price-points-and-maximizing-revenue/. 

• Ellman, Lauren Dana. “The Best Time to Book a Hotel to Save Money.” Travel + Leisure, Travel + Leisure, 27 Feb. 2025, www.travelandleisure.com/best-time-to-book-hotels-7107450. 

• “Global Short-Term Rentals 2025.” Phocuswright, Phocuswright, 1 May 2025, www.phocuswright.com/Travel-Research/Market-Overview-Sizing/Global-Short-Term-Rentals-2025. 

• Kelleher, Suzanne Rowan. “Why You Should Wait until 4 p.m. to Book a Last-Minute Hotel Deal.” Forbes, Forbes Magazine, 20 Feb. 2024, www.forbes.com/sites/suzannerowankelleher/2019/09/14/why-you-should-wait-until-4-pm-to-book-a-last-minute-hotel-deal/.

• López, Ana M. “Monthly Hotel Prices in Barcelona, Spain 2024.” Statista, 18 Sept. 2024, www.statista.com/statistics/614046/overnight-accommodation-costs-barcelona-city/. 

• Statista Research Department. “Hotel Average Daily Rate in Paris by Month 2024.” Statista, 17 Mar. 2025, www.statista.com/statistics/751665/hotel-double-standard-room-costs-paris-city/. 

• “U.S. Hotel & Lodging Market Report 2023-2027.” Phocuswright, Phocuswright, 16 Apr. 2024, www.phocuswright.com/Travel-Research/Market-Overview-Sizing/US-Hotel-and-Lodging-Market-Report-2023-to-2027. 

• Walderich, Andreas. “Thailand: Total Tourism Revenue from International Tourist Arrivals 2024.” Statista, 29 Jan. 2025, www.statista.com/statistics/994736/thailand-tourism-revenue-international-tourist-arrivals/. 

• “What the Olympics Did to Paris Lodging Prices.” NerdWallet, www.nerdwallet.com/article/travel/paris-olympics-hotel. Accessed 7 June 2025. 

• “When Is the Best Time to Book a Hotel: What Skyscanner’s Data Reveals.” Skyscanner, 25 Feb. 2023, www.skyscanner.com/tips-and-inspiration/best-time-to-book-hotels. 

Elizabeth Lavis

Elizabeth Lavis is a travel journalist and co-author of four Lonely Planet guidebooks, with bylines in HuffPost, Business Insider, American Way, and TripAdvisor. She writes about responsible travel, local culture, and off-the-beaten-path destinations around the world.

Our editorial process: DirectBooker curates insights from global hospitality experts and our network of industry insiders. Articles undergo rigorous fact-checking and quality review before publication, ensuring authentic, actionable advice for savvy travelers.