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During May and June 2019, Hilton Honors quietly started charging more points for standard room award nights at 1,000+ of its hotels. Not a single hotel now costs less! This is obviously the very reason why Hilton Honors got rid of award charts and started to take a more flexible approach to the pricing of award nights.
However, this award pricing strategy certainly hasn’t stopped Hilton Honors from continuing to sell points at 0.5 US cents each (0.4p). Details of the latest promotion can be found by clicking here.
For many years, my approach to the valuation of hotel points has been…
- How much do points cost during any consistently-repeated promotions?
- Can I find many hotels where I save money by simply buying points to then redeem on “free” award nights?
If the answer to question 2 is “yes”, then I am quite happy to base my points valuation on the promotion price. In the case of Hilton Honors this has been 0.5 US cents since 2013 or 2014. (0.4p if you really need to think in terms of sterling, but of course this would move around with the exchange rate)
Where are the Sweetspots?
Quick!!! Think of a hotel costing 20,000 points or less than provides really good value at 0.5 cents / 0.4p per point. I can’t think of too many…
- Hilton Garden Inn, Bali Airport at 5,000 points per night. You wouldn’t want to spend more than your first or last night near the airport, but the hotel is fine.
- Hampton Inn, Krakow Poland at 10,000 points per night.
- Doubletree Penang Malaysia at 10,000 points per night. I wrote about this hotel recently, although paid rates aren’t actually expensive in the first place…
That’s about it. Of course there are many more hotels that can provide reasonable value, but only if you happen to need that specific hotel on a high-demand date.
Otherwise you’re going to see a whole lot of this…
Or this…
What About More Expensive Hotels?
It is certainly plausible that Hilton Honors could only provide value these days at the higher end. Perhaps you need a hotel in central London for the August bank holiday weekend…
But You Cheated and Skipped the Fifth Night Free Benefit
I did indeed… and perhaps the only way to get more than 0.4p / 0.5 cents on a regular basis is to stay in five night chunks. But I ask you this… How many 5-night “weekends” have you managed lately? Or only stayed five nights in a hotel during a week-long holiday?
Yes there’s value from staying only five nights, but it’s not all that straightforward to arrange…
Reducing my Valuation of a Hilton Honors Point
Would I buy Hilton Honors points these days at 0.5 US cents each? Not unless I had a specific five-night stay in mind. Otherwise it’s simply too tough to convert those points into hotel stays that would otherwise cost more.
And if I’m not willing to buy Honors points at that price, what should I do when analysing the value of any Hilton Honors points I might earn as part of a paid hotel stay? Well… I should reduce my valuation… and based on quite a few data points I think I can justify a valuation of 0.4 US cents each. (0.32p)
Conclusion
Once you make that adjustment, something quite surprising then becomes apparent. However I’ll cover that in a future post. But for now, I’ll open it to the group… what do you think a Hilton Honors point is worth? Let us know in the comments section.
Craig
I have never bought hotel points (Hilton Diamond; Hyatt Globalist) for exactly the reasons that you give in this article – it’s not worth it ! Unless …. I will likely break that rule later this year / early next year as I am left with ~16,000 Hyatt points and will top up with 10,000 to be able to redeem for a one night stay.
Otherwise in the vast majority of instances it does not make economic sense to buy points / miles etc.
There may also be the odd occasion where a hotel is extremely busy (Xmas, New Year, 4 July, festivals) and the room rate goes sky high and the points purchase / redemption makes more sense – I’ve not had the need / opportunity .. yet.
I used to buy Hyatt points frequently, and still think that they are great value. But once I realised that I wasn’t getting credit for lifetime Globalist from award stays, I’ve started to pay cash in the more marginal situations.
I used to buy the maximum SPG points as well. Still hoping that Marriott will reduce the price to the same range, perhaps in a Black Friday sale or something.
As for IHG/Hilton, they’ve simply devalued their award pricing so far that buying points is really hard to justify.
So what is your view on the Hyatt ‘Double your Points’ room rates – is it worth paying ~10% extra to earn double points ??
You are getting an extra 10 points per $ – worth 4% – in exchange for paying 10+% more.
There are plenty of times when buying (Non Hilton) hotel points make sense. As you say when room rates are high like summer hols or special event is classic. Just about to go to Domes again this month and at the time I bought some SPG points to have enough for the week’s redemption costing about £600 when the room rates are normally £800pn in summer. Same recently when I bought some Marriott points for a stay during a Grand Prix weekend. £320 worth of points instantly paid for a room costing £2000!
With regards to Hilton points specifically, I never use them for rooms now, just for their auctions which I believe is often tremendous value for money can’t buy experiences. I’d buy points just for using on those.
You’re right about the auctions. I haven’t bothered to check lately since I’ve burned most of my Hilton points, but there are definitely going to be some gems in there…
I’ve been to Malaysian GP with paddock club passes, three night stay in a suite at Hilton KL all for 150,000 hilton points quite recently! Some gems in there if you are prepared to travel…
You should also factor in the extremely high risk of Hilton just devaluing the points at any moment.
Hello,
Don’t forget Turkey for cheap redemption…
2 years ago I bought points thinking about the crazy value of 5000 points properties ==> Rzegow, belo horizonte, Turkey, …. a few months after I bought points the majority of 5000 points properties went up to 10.000 points.
1 year ago I bought points thinking about the crazy value of 10.000 points properties ===> Vienna, Bratislava,…. one month ago they went all up to 20.000 points.
Now I don’t buy anymore and came to the same valuation than you at 0.004 USD. I treat this as cashback with 0.004 USD per points. Before points what interest me the most at hilton is free breakfast + sometimes lounge access + room upgrade (in Europe or Asia).
The issue with the 0.004 USD valuation is that it makes some reward night anormaly cheap… Ex: hampton krakow = 10.000 points = 40 USD the night or if bought with 5th free = 8000 points = 32 USD…. if diamond with free breakfast and bonus after 60 nights = 60.000 points so 7000 points/night = 28 USD breakfast included without factoring potential welcome gift and promo like right now (amount of points depending of number of stays during summer)
a 5000 points property like garden inn izmir at 5000 points means for a diamond 3000 points = 12 USD per night breakfast included. At that rate we could live in a hotel in Turkey for around 360 USD per month breakfast included!! This price doesn’t factor in the possible promo that could give points back at you…
To be honest, the program devalue but I have the impression that as time pass the promo are more and more generous… The 4000 points back in winter was just crazy generous. This summer they give double points + a bonus after a number of stays compared to only double points last time….. So my impression is that they give more points but you have to use them as fast as your earn them…
Like James says the idea of collecting points for aspirational properties doesn’t seem to be the optimal way to play the game anymore because if you wait before redeeming you could be diluted before making your move.
Sorry for my bad english spelling/grammar and for the long text!!
Thanks for the great contribution. Indeed there are several hotels in Turkey that cost few points, but alas my only experience has been with some of the Istanbul options that are far too inconveniently located for sight-seeing (and are cheap when paying cash anyhow). Since the Hiltons in popular resorts seem as expensive as anywhere else in the world, I haven’t really dug into the non-Istanbul 5/10k point hotels to look for gems…
The problem Hilton have created for themselves is a lack of trust through devaluing the points whenever they fancy without any warning, taking a redemption out of the reach of someone trying to achieve it. There are only so many times that can happen to customers before they lose faith in the brand.