US Hotel Rates Surge as Christmas Rooms Hit $197, Up 18% on 2025

A pricing year nobody forecast

The US hotel industry started 2026 expecting almost no growth. It is ending the year with some of its best numbers since the pandemic, and holiday travelers are paying for it. InterContinental Hotels Group (IHG) said revenue per available room (RevPAR) across its US portfolio rose 6.9% in the third quarter. In January, CoStar and Tourism Economics had forecast full-year RevPAR growth of just 0.6%.11 Meanwhile, Hopper's 2026 Holiday Travel Index puts the average Christmas-night hotel rate at $197, up 18% from 2025.1113

One point about the headline numbers matters before going further. The 6.9% figure measures revenue per room, which combines occupancy and price. It is not the change in room rates. IHG's own numbers show Americas RevPAR up 6.8% for the quarter, occupancy at 73.9% (up 2.1 percentage points) and average daily rates up a more modest 3.9%.11 So the third-quarter gain came from both fuller hotels and higher prices. The Christmas jump is different: it is almost entirely about price. Hopper's figures show the average Christmas rate rising from $167 to $197, while Thanksgiving held flat at $170.1527

That gap between the two holidays is the most telling detail. Almost every outlet that covered Hopper's report noted it.2326 Thanksgiving rooms cost the same as last year, while Christmas rooms have moved into a higher price tier.12 Our reading is that hotels are charging most where demand is most concentrated and least flexible, rather than raising rates across the board.

Why rooms got expensive

The coverage broadly agrees that 2026 brought more demand than forecasters expected, driven partly by big events. In August, CoStar and Tourism Economics raised their full-year RevPAR forecast to 4.4%. They pointed to the FIFA World Cup and America 250 celebrations, which they said added 11.4 million room nights in the first half compared with the same period of 2025.11 IHG's third-quarter results and weekly CoStar data suggest the industry is now running ahead of even that revised forecast.11

September showed how strong the autumn has been. CoStar reported that RevPAR for the week of September 20–26 rose 14.2% to $125.06. Occupancy reached 69.7% and the average daily rate rose 7.4% to $179.43. Weekday and group business led the gains, and weekday RevPAR across the top 25 markets jumped 22.9%.12 CoStar also noted that part of that gain came from the timing of Rosh Hashanah, which made the 2025 comparison week weaker.12 That caveat is worth keeping in mind: not every double-digit week this autumn reflects new demand.

Other data points the same way. For the week ending October 17, US hotels reported 70.7% occupancy and an average daily rate of $177.65. Events drove big local gains, including a 20% RevPAR increase in Detroit and an 18.5% increase in San Diego.25 Corporate bookings for the holidays also look strong. One industry dashboard showed forward corporate hotel bookings running 7.7% ahead of last year for November and 11.2% ahead for December.

Costs are a further reason prices may stay high. An HVS market report cited in the coverage says tighter immigration enforcement has shrunk the pool of hospitality workers and pushed up labor costs. That raises the minimum rate hotels can charge and still make money, even if demand softens.11 If that is right, holiday discounting is less likely than in past years.

Airfare costs even more

Hotels are only part of the holiday bill, and not the largest part. Hopper says Thanksgiving and Christmas airfares are at 10-year highs.13 A domestic round trip averages $402 at Thanksgiving, up 31%, and $452 at Christmas, up 23%.2122 Coverage consistently blames months of high jet fuel prices linked to the conflict with Iran.2122 Some reports add that airlines cut less profitable flights and raised fares and bag fees to recover costs.26

The spread between travel dates is unusually wide. Thanksgiving round trips returning Sunday, November 29, average $604. Staying until Monday or Tuesday cuts that to about $350.21 For Christmas, departures between December 18 and 20 average just under $500, and returns on January 2 average more than $560.13 International fares are rising too: Christmas fares to Mexico and Central America are up 23%, and fares to Europe are up 15%.13 One breakdown of Hopper's data found Christmas fares to Asia and Oceania slightly lower than last year.27

Airlines are not signaling any letup. Delta CEO Ed Bastian said fares will reflect "what the market bears" and called the company's customers resilient.29 For a traveler combining a $452 flight with several $197 hotel nights, the total cost is clearly higher than in 2025.

The booking window is closing

Hopper is giving travelers a clear deadline: book holiday flights and hotels before Halloween.2326 The reasoning is that travelers are booking earlier than in recent years, which uses up the cheaper inventory that used to keep October rates down.12 The Points Guy gives the same advice.12 Hopper does note one exception: hotels in major cities may cut rates 24 to 48 hours before the holiday to fill unsold rooms.13

The broader data on last-minute booking complicates the simple rule. KAYAK found hotel prices swing by an average of 34% in the 30 days before a stay, in either direction. Hotels.com names 8 to 14 days before travel as the best window in most markets.18 Both analyses, though, say peak and event-driven dates are the exception, and hotels running near full have little reason to cut prices.18 Christmas 2026 fits that description, so the Halloween deadline looks like sound advice rather than marketing.

Are consumers still spending?

This is where the reporting is most mixed. The industry forecast is steady but slow: the U.S. Travel Association expects 2026 travel spending to reach a record $1.37 trillion, up only 1% after inflation, with domestic travel making up 87% of it.15 Domestic leisure is the only segment above pre-pandemic spending in real terms, at a projected $909 billion.5 The same forecast lists persistent inflation, energy prices and weaker consumer confidence as risks.5

Signs of strain showed up during the summer. Only 45% of Americans planned summer trips with paid lodging, a six-year low, even though trip budgets rose 17%.2 One analysis of Hopper's data found per-person holiday travel budgets falling from $553 to $419 as fares climbed.20 US passenger traffic fell 4.4% in August, according to one industry comparison. These figures do not show demand collapsing. They suggest fewer people traveling and the ones who do paying more, which matches the rate-driven growth seen at the hotel level.12

International visitors are still falling

International demand is the clearest weakness in the outlook. Overseas arrivals to the US fell 5.7% in the first nine months of 2026, to about 24.11 million, after total international arrivals dropped 5.5% in 2025.9 Arrivals from Germany were down about 14.9% and from France about 15.3%.8 Foreign visitor spending fell almost 5% year over year in August to $19.9 billion. Spending on hotels, restaurants and leisure fell nearly 9%.3 The World Cup brought a short-term boost: about 471,000 international air visitors came for the tournament in the second quarter. But air arrivals overall still fell 6.1% in that quarter.8

The official forecasts have not caught up. The National Travel and Tourism Office still projects 70.5 million international visitors in 2026, up 3.2%.9 U.S. Travel's spring forecast expected 1.6% growth in international spending.1 The arrival data through September makes both numbers hard to reach.

The bottom line

Taken together, the reporting points to a hotel market that is strong on price and weak in its base of customers. Events, corporate groups and resilient higher-income domestic travelers drove 2026's gains, while foreign visitors and price-sensitive households pulled back. That combination supports high Christmas rates, especially alongside record airfares and rising labor costs. It does not guarantee that 2027, with no World Cup to fill rooms, will be as strong. For travelers who still need December plans, the advice in the coverage is consistent: book soon, and choose travel dates carefully.