Book with free cancellation, then rebook when the price drops

The strategy is simple: book a hotel rate that you can cancel for free, keep watching the price for the same stay, and if the price falls, book the new cheaper rate and then cancel the original. You keep a guaranteed room the whole time, and you can still benefit if rates go down. It works best for hotels, where refundable rates are common. The key is to follow the steps in the right order and to respect the cancellation deadline.

Why this works

Hotel rates move up and down as hotels react to demand and occupancy. If you book a non-refundable rate, you are locked in whatever happens next. If you wait without booking, you risk prices rising or the hotel selling out.

A free-cancellation booking sits in between. You have a room secured, but you are not committed to that price until the cancellation deadline. That gives you time to watch for a better deal.

The trade-off: refundable rates can cost more

Refundable rates are often more expensive than non-refundable rates for the same room. You are paying for flexibility. Whether that is worth it depends on:

• How likely your plans are to change. If there is a real chance you will cancel, flexibility has value on its own.
• How much prices tend to move for that city and period. In quiet periods there may be more room for drops.
• The size of the gap between the refundable and non-refundable rate.

Sometimes the right move is to book refundable first, then switch to a cheaper non-refundable rate later when you are sure of your plans and the price is good.

Step by step

1. Book a refundable rate. Choose a rate clearly labelled with free cancellation. Note the exact deadline, including the time and time zone.
2. Save the details. Record the hotel, room type, board, number of guests, total price including taxes and fees, and the cancellation deadline.
3. Watch the same stay. Look for the same hotel, dates, room type and conditions. A price alert can do this for you.
4. Compare carefully when a drop appears. Make sure the new price is for the same room, board and guest count, and check whether it is also refundable.
5. Book the new rate first. Only cancel your original booking once the new booking is confirmed. If you cancel first, the cheaper room might be gone.
6. Cancel the original booking. Do it through the site or hotel you booked with, before the deadline. Keep the cancellation confirmation.
7. Keep watching if you like. If the new booking is also refundable, you can repeat the process.

What to watch out for

• Free cancellation is not always unlimited. Many rates only allow free cancellation until a certain number of days or hours before arrival. After that, fees apply.
• Prepaid versus pay at the hotel. Some refundable rates charge your card upfront and refund later. Refunds can take time to appear, so you may briefly have two charges.
• Currency and card fees. If the booking is in a different currency, exchange rates and card fees can change the real saving.
• Different conditions. A lower price may exclude breakfast, be for a smaller room or have stricter rules.
• Taxes and fees. Compare total prices for the whole stay, not nightly rates without taxes.
• Loyalty benefits. Rebooking through a different site might mean losing points or member perks from the original.

Does this work for flights?

Less often. Most cheaper airline tickets are not fully refundable, and change fees or fare differences can wipe out the saving. Some fares do allow free changes or cancellation, and some places have rules that let you cancel shortly after booking. Check the exact fare rules before relying on it. For flights, the more common approach is to watch the price before you book and buy when the fare reaches your target. See when to book flights.

Prices in alerts are recently seen prices

A price drop in an alert is based on a price that was recently seen, which can be a few hours to around two days old. Always confirm the live price on the booking site before you cancel anything. More on this in cached vs live travel prices.

How to set a Trigger for it

1. Go to hotels and search for the specific hotel you booked, or the city if you are open to alternatives.
2. Enter the same check-in and check-out dates, guests and rooms as your booking.
3. Turn on the free cancellation filter so you are only alerted to rates you could cancel too.
4. Add star class or guest rating filters if you are searching a whole city.
5. Set your target price below what you paid, by enough to make rebooking worthwhile.
6. Create the alert. Trigger emails you as soon as the price is at or below your target, with a link to the partner site to check the live price and book.

Trigger is free, with up to 10 active alerts, and each alert ends on the check-in date. After the first email, you only hear again if the price drops at least 5% further, at most once a day. Read do hotel prices drop? for more background.