Introduction:
When most people think about using points, the first thing that comes to mind is redeeming them for flights.
But what about hotels? After all, hotels are just as big a part of travel as the flights that get you there. In fact, redeeming points for hotel stays can sometimes offer outsized value, especially in expensive destinations or when booking last-minute.
In this post, we’ll break down everything you need to know about redeeming hotel points: how the process works, which programs give you the best value, and when it makes sense to use points versus paying cash. Along the way, we’ll highlight strategies to stretch your points further, common mistakes to avoid, and practical tips for redeeming points.
The goal is to provide a clear framework to help you make better decisions with your points, and help you stretch them further on your next trip.
TLDR:
- Hotel redemptions are most valuable for expensive stays, last-minute bookings, or aspirational properties.
- Redeeming hotel points directly with loyalty programs (Hilton, Marriott, Hyatt, IHG) is the best way to maximize value.
- Bank programs such as Amex MR, RBC Avion, and Air Canada Aeroplan offer hotel bookings but often provide poor value compared to flights.
- Always compare cash and points prices as sometimes paying cash provides better value.
Why Redeem Points for Hotels:
While using points for flights can offer incredible value, redeeming them for hotel stays provides fantastic opportunities as well, often with added flexibility.
The biggest advantage of using points for hotels is when cash rates are high. During peak season or for last-minute bookings, hotel prices can skyrocket, but the number of points required for a stay often remains the same. This lets you lock in a room without paying inflated prices.
Hotel redemptions also come with more flexibility. Their cancellation policies are usually much more generous than those for flights, often allowing you to get a full refund as long as you cancel before the cancellation deadline. Additionally, while flights often have extra taxes and fees, hotel bookings with points typically cover the full cost of your stay. The only exception to this is some properties that charge a separate resort fee.
Ways to Redeem Points for Hotels:
When it comes to redeeming points for hotels, there are three main methods: fixed-value travel portals, flexible bank programs, and hotel loyalty programs.
Fixed-value portals
Fixed-value portals like ExpediaForTD, CIBC Rewards, or MBNA Travel are the most straightforward. Each point is typically worth 1 cent, (with the exception of TD points which are worth 0.5 cents) which makes the math easy. Prices usually line up with sites like Expedia or Hotels.com, though sometimes there’s a small markup.
To redeem points, simply login to the travel portal, select your dates of travel and the property you want to stay at, and apply points to your purchase upon checkout.
Flexible points programs
Using points from flexible travel programs like Amex Membership Rewards, RBC Avion, and Air Canada Aeroplan for hotel stays is also an option, though it’s generally not the best value.
These redemptions are often priced based on the hotel’s cash rate, and there’s usually a markup, which means you get less value per point compared to flights. The typical redemption rate hovers around one cent per point (1 CPP).
However, there are still a few ways to get value from these programs:
- RBC Avion occasionally offers 25% off hotel sales, which can significantly improve your redemption value.
- Air Canada credit cardholders can take advantage of a “Stay 3, Get the 4th Night Free” hotel offer, which can be great for longer stays.
- For Amex Platinum and Business Platinum cardholders, the best use of points is often in combination with your annual travel credit. Stacking this with the Fine Hotels & Resorts program can unlock valuable perks like complimentary daily breakfast, guaranteed late check-out, and room upgrades.
While these options won’t “maximize” your points in the same way that a high-value flight redemption would, they can be a very practical way to lower your out-of-pocket costs when you have a large points balance and a specific hotel stay in mind.
Hotel loyalty programs
For the best value when redeeming points for hotels, you should use hotel-specific loyalty programs (like Marriott Bonvoy, Hilton Honors, or World of Hyatt).
These programs often offer very flexible cancellation policies, and they frequently run special promotions. For example, both Hilton and Marriott have a “5th Night Free“ perk, where you only pay the points for four nights when booking a five-night stay.
Additionally, booking directly with a hotel chain lets you “stack” your points redemption with any elite status you have. This can unlock valuable perks like free breakfast, room upgrades, or late checkout, which adds even more value to your trip.
Booking is simple: log in to your hotel account, search your destination, and toggle to “Use Points.” The site will show you the nightly rate in points. From there, compare the points cost to the cash price to make sure you’re getting good value before you book.
Maximizing Value:
The golden rule for getting the most out of hotel redemptions is simple: stick to hotel loyalty programs. Redeeming points directly through brands like Marriott, Hilton, Hyatt, or IHG almost always provides better value than using a bank or loyalty program’s travel portal.
When you book directly, you can take advantage of valuable promotions, like Marriott and Hilton’s “5th Night Free” perk on award bookings. This allows you to stay five nights but only pay the points for four.
Additionally, your elite status with a hotel program can also add significant value. Even mid-tier status, such as Hilton Gold, and Marriott Platinum can transform your stay by providing benefits like free breakfast, dining credits, late checkout, and room upgrades. These perks that could easily save you $50 to $100 a day.
To truly maximize your redemptions, look for “sweet spots” where your points are worth far more than average. This includes high-end hotels in expensive cities, last-minute luxury bookings, or aspirational properties like overwater villas. In these cases, your points could be worth double or even triple their typical value.
Finally, if you’re just short of the points you need, consider buying them during a point sale. Sometimes, the math works out so that buying points is actually cheaper than paying the cash price for the room.
Common Mistakes to Avoid
When using points for hotel stays, there are a few easy traps that can reduce the value of your points.
A big one is using flexible points from programs like Amex Membership Rewards, RBC Avion, or Air Canada Aeroplan to book hotels. These redemptions usually offer far less value than flights and often come with inflated prices. You’re almost always better off using these points for air travel.
Another common mistake is redeeming points for budget hotels where the nightly cash rate is already low. In these situations, you’re better off paying cash and saving your points for a more expensive stay where they will provide greater value.
It’s also important to double-check the details before you book. Some properties charge resort fees or local taxes, even on award stays, and these costs can add up quickly.
Finally, don’t assume that using points is always the best option just because you have them. If the cash price for a hotel is low, pay with cash and save your points for a future trip where they will truly shine.
Putting it All Together
Let’s walk through a quick example.
For a 5 night stay at the Hampton Inn & Suites Maui North Shore (Hawaii), it would cost $2692.25 USD.
For the exact same room using points, it would cost 320,000 points (80,000 x 4 nights, since Hilton offers the 5th night free benefit when redeeming with points)
Currently there is a 100% points bonus for buying Hilton points (this sale occurs regularly). The cost to buy 320,000 points is $1600 USD.
So, to stay 5 nights using points, you can pay $1600 USD, instead of $2692.25 USD, which results in a savings of $1092.25 USD. (Note, there is a nightly resort fee of $25 USD in addition to the points redemption, so the net savings is $967.25 USD.)
With this redemption, each Hilton point is worth 0.84 CPP USD ($2962.25/320,000). When converted to CAD at the current exchange rate of $1 USD to $1.39 CAD, the value of each point becomes 1.17 CPP CAD. Far above the target value of 0.7 CPP.
Now, to make it even more valuable, if you have Hilton Gold Status (or higher), which can be obtained simply by holding the American Express Platinum credit card, you can also get up to $25 USD Food & Beverage Credit per person, per day. With 2 people staying at the hotel, that would equal $250 USD ($25 x 2 x 5) that can be used on food and drinks.
To see a review of a stay I previously redeemed in Hawaii, click here.
Conclusion:
Hotel redemptions are often overlooked in the world of points and miles, but redeeming them strategically can unlock great value. Whether you’re saving hundreds on a last-minute trip or booking a dream property without spending a dime, hotel points are a powerful and versatile tool.
Take a moment today to log in to a hotel loyalty account and search for a property you’d love to visit. Compare the cash price to the points price. This simple exercise will help you learn when using points is a great deal and when it’s smarter to pay with cash.
If you’re not already a member of a major hotel program like Marriott, Hilton, or Hyatt, sign up today! (It’s free!)
This is the first step to building a points balance. Then, the next time you’re planning a trip, you’ll have more options at your fingertips, and maybe even a free night waiting for you!
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