How Hotel Rating Affects Price

Let’s admit it: who doesn’t want to stay in a 5-star hotel? Perhaps the only deterrent from living in the lap of luxury is its price; vacationing like the rich and famous is, well, expensive.

So where might one splurge for a (relative) steal? Are there certain cities that make luxury accessible to the masses? And what is a 5-star hotel anyway? Hipmunk dug deep into its star power booking data to break it down. Here’s what we found:


At an average nightly booking price of $292, 5-star properties in the US are definitely pricey. Indeed, we found a 16 percent average price increase associated with each star rating increment. Further, 5-star properties are 42 percent more expensive on average than 4-star properties.

So which 5-star destinations are the most popular for US travelers?


Posh locales in California such as Newport Coast, Dana Point, Ojai, and Lake Tahoe dominate the list, claiming 13 of the top 25 spots. But Canyon Point, UT, home toAmangiri Resort, wins as the biggest 5-star draw with 100 percent of its bookings occurring at a 5-Star property. To see a breakdown of the percentage of 5-star properties by city, click here.

While many of these locations may be fiscally out of reach for the majority of travelers, luxury-lovers need not despair; we found some amazing 5-star locations that are also relatively budget-friendly. Las Vegas, NV, is not only a city with a high percentage of 5-star bookings– it’s also one of one the more affordable. But its cousin, Reno, “the world’s biggest little city”, wins as the destination where travelers can get the most bang for their buck.

So which locations are the priciest? Coveted locations in Colorado, Hawaii, and California dominate the list.


So What Makes a 5-Star Hotel Anyway?

Hotel star rating systems, like the one found on Hipmunk*, are widely recognized as the definitive way to ascertain a hotel’s overall quality, yet the rankings can differ greatly from one country and ranking system to another. In the US, for example, there are a number of competing systems, from the American Automobile Association to local councils. But while there’s no international standard that hotels across the world adhere to, stars do pertain to a hotel’s level of service, amenities, cleanliness, location, and price.

According to the Mobil Star lodging criteria, both 4-star and 5-star hotels provide a luxurious environment for their guest. “The differences in the physical environment, particularly the guest rooms, lie in the details. Four-star rooms offer pampering basics such as triple-sheeted beds and live plants. Meanwhile, 5-star rooms offer consistently superlative service in an exceptionally distinctive luxury environment with expanded services. Attention to detail is evident throughout the Hotel/Resort/Inn from the bed linens to staff uniforms.”

Methodology: Hipmunk analyzed the average nightly price of its 5-star hotel bookings in the US from Aug 31, 2015 – Aug 31, 2016.

*Hipmunk’s hotel star ranking is provided by our hotel booking partners.


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