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Travelers saw prices drop for big-ticket pieces of their vacation budgets in July, providing at least temporary relief after soaring costs earlier this year.
Air fares fell nearly 8 percent from June to July, while prices for rental cars and accommodations such as hotels fell 9.5 percent and about 3 percent, respectively, according to the U.S. Labor Department’s monthly inflation report released Wednesday. It was the second consecutive month of price declines for each category.
“It’s really good news, I think, when people are planning their vacations,” said Sally French, travel expert at NerdWallet.
Airline ticket prices peaked in May this year, with companies scaling back flight schedules due to increased consumer demand from the Covid-19 pandemic and factors such as high jet fuel costs and staff shortages for airlines. to the experts.
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Air fare growth at the start of 2022 was “unusual”, said Haley Berg, chief economist at Hopper.
Hotel and rental car prices also rose in the spring, while higher gasoline costs also served to stretch road-trip budgets.
‘Many’ people just traveled despite the high cost
According to Destination Analysts, a tourism market research firm, 39 percent of travelers said the general cost of travel was too expensive to prevent them from traveling more than they wanted to in the past six months. Almost half, 47%, clearly cited the cost of gasoline and 27% did so for airfare.
Financial concerns have compounded other travel headaches over the past several months, such as an increase in lost luggage and delayed or canceled flights.
However, “a lot” of people still traveled in the summer — more than half of Americans traveled in the past month, according to a survey of destination analysts fielded in July.
Despite the recent cold snap, travel remains largely more expensive than it was pre-pandemic. Air fares rose 16% this July compared to July 2019, according to monthly Consumer Price Index data.
Hotels are a modest 6% more for the same period while rental cars are up nearly 48%, which is “easily the sharpest price increase of any. [travel] We track the category,” French said. In addition to consumer demand, factors such as semiconductor shortages have impacted the auto industry more broadly, she added.
“It’s still important to remember [that] If you haven’t traveled since pre-Covid or haven’t traveled extensively, you should expect to pay more than you’re used to,” French said.
How to score the best deals on upcoming trips
Travel experts had some tips to lessen the sting of a potentially expensive trip.
Travelers who can be flexible with vacation dates may be able to get better deals on airfare, French said. A tool like Google Flights lets users compare prices for selected travel dates as well as weeks or months before or after other combinations, for example, she said.
You may find that extending the trip by a day can save enough on airfare to more than offset an extra night at a hotel—and give you an extra day of vacation.
“I encourage people to be really flexible about their budget,” French said.
For the best deal on airfare, travelers planning domestic travel for the fall should book their plane tickets at least three to six weeks before departure, after which prices tend to rise quickly, Berg said.
Flying in the fall is also one of the best ways to save on international airfare, as prices are often lower in September and October than in the summer months, Berg added. Travelers usually get the best deals when booking about four weeks in advance, she said.
Furthermore, departing midweek instead of on peak days typically saves $35 per ticket, according to Hopper.
Travelers are better served booking hotels closer to their arrival date, however, especially for big city destinations with ample accommodation, experts said. That’s because hotels often drop their prices to clear inventory as the check-in date approaches.
Renting a car from a major airport hub can also be a safer bet during particularly high demand — those hubs typically have larger car fleets, making it less likely that the company won’t have a vehicle for you upon arrival, Berg said. Travelers who prefer to fly into a regional airport may consider renting from a nearby larger airport and taking a taxi there, for example.
Returnable travel can also provide financial benefits — especially related to rental cars and hotels — for those travelers willing to put in a little extra work, French said.
For example, travelers can often choose to defer payment for these purchases until their arrival date. While travelers may pay a slightly higher rate for that luxury, purchasing a fully refundable hotel or rental car allows travelers to monitor the prices going into their trip; If the price drops earlier, travelers can book at a lower rate and then cancel their original booking, French said. However, consumers should, of course, be aware of any restrictions that may apply.