Which is the cheapest option for you?

When it comes to planning a trip, one question keeps coming up: Should I book a hotel or a vacation rental? There are pros and cons to each option, and your choice ultimately depends on your destination, group size, and personal priorities. But at the end of the day, you’re probably interested in which choice will save you the most money.

When it comes to base nightly rates, rentals are generally cheaper, but there are exceptions and a plot of warnings. Once you factor in hidden fees, amenities, local taxes, and hotel loyalty programs, the financial balance can really tip in any direction.

While the “best” accommodations really vary on a case-by-case basis (Jack may appreciate the extra space, while Jill appreciates the free amenities), here are some deciding factors to keep in mind when researching your next trip.

Factors to Consider When Choosing Between a Hotel and Airbnb

Group size

If you’re traveling with a large group, vacation rentals are almost always the cheapest option. You can find homes on Airbnb and Vrbo that can accommodate 16 people, a group size that would require at least four separate reservations at a hotel. Plus, you get common spaces like living rooms and backyards, instead of cramming into a suite or hotel lobby.

Solo travelers or couples can go either way. Airbnb lists single rooms alongside whole units, which means you would have your own sleeping space but would have to share the bathroom and kitchen with the owner. That slight lack of privacy is often worth it – check this out Mexico Suite for $39 per night, or this room in berlin for $29. In terms of whole units, however, prices tend to be comparable to individual hotel rooms (probably not five-star ones, though).

The duration of the stay; duration of stay

Another determining factor when it comes to cost is the length of your holiday. If you’re staying in a city for one night, booking a hotel room may be the cheapest option (especially if the hotel offers free airport shuttles). The minor hassles of renting an Airbnb – finding transportation, exchanging keys, shopping, etc. – not really worth it for a 24 hour trip.

For trips longer than a few days, Airbnb takes over. You have to pay a rental fee regardless of the length of your trip (more on that later), so a $150 cleaning fee seems much more reasonable for a two-week stay than for a two-night stay. Some Airbnb hosts will also offer discounts for long-term stays – in fact, the company encourages this on their “How to hostsection online. The exact discount is entirely up to the host. Most cap it at around 10-15%, but you can find much deeper discounts if you dig deep.

Tariff flexibility

While hotel rates are usually set in stone, there is a little wiggle room when it comes to vacation rentals. Since you are able to communicate with Airbnb hosts before booking the property, you may have the opportunity to haggle a bit.

“If you notice a house rental is available for future dates, ask the owner if they can lower the rate a bit, especially if there are a lot of rentals available in the area,” says Andrea Woroch, an expert in personal finance and consumer savings. “Chances are the owner would rather rent it out for less than nothing.”

destination city

In a study 2021 from Bounce, travel experts analyzed hotel prices and Airbnb listings in 80 of the world’s most popular tourist destinations. They discovered many places where hotels are on average 60% cheaper than vacation rentals. In Waikiki Beach, for example, the average price per night for Airbnbs is $271, while hotel prices are only $74. Nashville, Niagara Falls, Phuket, Barcelona and Bali are other preferred locations for hotels.

And then there are places where Airbnbs are ridiculously cheaper than hotels, like Boston ($172 for Airbnbs, $397 for hotels, on average) and Bora Bora ($269 for Airbnbs, $904 for hotels, on average). Sure, these Bora Bora vacation rentals might not be overwater bungalows with spas and private chefs, but they sure are cheaper.

Restoration options

Aside from nightly rates, probably the biggest gap between Airbnb and hotel fees is food. Almost all Airbnb rentals come with a kitchen or kitchenette (even if you have to share it with others), which makes it easier to cook your own meals instead of dining out multiple times a day. Especially in big cities like Las Vegas, where a simple lunch can easily cost a person around $25, the potential savings here are obvious.


“If you want amenities, go for a hotel,” says Woroch. The most interesting hotels have swimming pools, fitness centers, free breakfasts, shuttle services and endless coffee, as well as the most sacred of all sacred amenities: a 24-hour concierge. Beware of amenities that are not free, such as valet parking and long distance phone calls. And whatever you do, don’t open that jar of peanuts in the minibar.

That being said, there are Airbnb rentals with hotel-like perks, including pools and gyms. There’s also Airbnb Luxe, a branch of the company that offers high-end rentals with designated “tour operators” to arrange airport transfers, babysitting services, private massages, and whatever else you need. might need 24/7. These rentals are… not cheap. (Castle in Tuscany for $15,633 per night, anyone?) But they certainly put the platform on par with hotels when it comes to aneminitis.

Hidden fees

When you search sites like Airbnb and Vrbo, the results only list the properties’ per-night rates. They don’t factor in service fees, cleaning fees, owner fees, and other little surprises that can bump up the final price by hundreds of dollars. Some hosts will cover other expenses at their own discretion, such as fees for bringing extra guests or fees for heating outdoor pools.

“I’ve seen landlords cram things like ‘linen fees’ into home rental rates before,” Woroch says. “If I see this I usually look for another property or ask the landlord if they can take it off the rental price.”

Communicating with the host often gets results, but some fees are certain, like taxes. (Benjamin Franklin was right.) In some locations, Airbnb has entered into agreements with government officials to collect local taxes, and the company is required to collect Value added tax (VAT) to customers in certain countries.

There’s no set rate for service fees and cleaning fees (some hosts don’t even charge a cleaning fee at all), but you shouldn’t be surprised to see each fee add an additional $200 to the total price. Cleaning fees have become particularly high in the age of COVID, with Airbnb introducing a “Improved 5-step cleaning processwhich all hosts must follow now. This is a good thing, but it creates an incentive for hosts to increase these fees.

Loyalty programs

One last thing to consider: hotel loyalty programs. If you’re loyal to a certain hotel brand or stay at a property several times a year for work, it’s easy to reap the rewards. Depending on how many visits you log per year, you might be looking at free meals, free hotel nights, or waived resort fees (the latter alone could save you hundreds of dollars). But what if you only visit a channel a few times a year? “No matter how often you plan to stay at a particular hotel brand, sign up for their loyalty program anyway,” says Woroch. She points out that some programs (such as best western) don’t put expiration dates on their points, which means you can safely accumulate them over a long period of time. Plus, even the lowest loyalty tiers can get you at least free Wi-Fi.

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