When booking a hotel you're almost always faced with this choice: the cheaper, non-refundable rate — or the more expensive, flexible rate with free cancellation. Many choose intuitively the cheapest option. But is that really the smarter decision?
The difference in numbers
A real-world example: You book a hotel in Barcelona for 5 nights.
- Non-refundable rate: €680 (saving vs flexible: €70)
- Flexible rate: €750 (free cancellation until 24h before arrival)
At first glance: €70 saved. But what if the price drops after booking?
The factor most people overlook: price fluctuations after booking
Hotel prices aren't fixed — they change constantly. Studies show: in 40–60% of all bookings, the price drops at least once after booking. The average price reduction is 18%.
In our example: 18% of €750 is €135 in potential savings. The flexible rate costs €70 more — but if the price drops, you can cancel and rebook. You save €135, paid €70 extra, making a net profit of €65.
When does the cheap rate pay off anyway?
- Very short booking lead time (less than 2 weeks): Price unlikely to drop further
- High season or events: Trade fairs, holidays, major events mean no price drops expected
- Large price difference (more than 25–30%): Risk usually not worth it
- You're 100% certain you're travelling: No chance of cancellation from your side
When does the flexible rate pay off?
- Booking lead time over 4 weeks: Plenty of time for price fluctuations
- Low season: Hotels are incentivised to sell remaining rooms cheaper
- Uncertain travel plans: Work, health, family — flexibility has value
- Small premium (less than 10%): The "insurance" is cheap
The smart combination: book flexible + price monitoring
The best strategy: book a flexible rate, then have the price monitored automatically. You get all the benefits:
- Your room is secured
- You won't miss any price drop
- You can cancel and rebook cheaper if needed
SaveMyHoliday monitors your hotel price daily, free of charge and without an account. You receive an email as soon as the price drops — and can then decide whether to take the saving.