People are booking Christmas vacations earlier than ever before
What a difference a year can make.
Last September, the travel industry agonized over a dearth of Christmas bookings. This September, some hotels are already fully booked for the holiday season.
People are reserving their Christmas vacations earlier this year, despite an unsettling rise in Covid-19 infections caused by the highly contagious delta variant.
The reason, said Tim White, founder of travel website Milepro.com, has everything to do with vaccines.
"As soon as … people got vaccinated — boom! — they were booking their year-end activities," he said. White said the spring brought a "huge spike" in holiday bookings at major hotel chains like Hilton and Marriott.
But it's not just that booking rates are exceeding last year's lackluster numbers. Many companies are reporting far more reservations for holiday trips now than they did before the pandemic.
"People are stubborn … and I mean that in an admiring way," said Carolyn Corda, the chief marketing officer for the travel marketing company Adara. She told CNBC that a rise in Covid infections over the summer didn't cause a huge dip in travel bookings which could indicate leisure travelers are no longer inclined to cancel trips over Covid.
Bookings 'earlier than ever before'
Mohonk Mountain House, a resort in New York's Hudson Valley, launched its holiday campaign on July 6 — the earliest the hotel has ever done in its 152 years of operation.
December reservations made by leisure guests are up 60% at Mohonk compared with the past three years, according to the hotel.
"Travelers are booking for the holidays earlier than ever before," said Alisha Kapur, senior travel manager for web analytics company Similarweb.
Internet search queries for December travel were five times higher this August than last, she said, adding that U.S. travelers are mostly traveling domestically this Christmas.
And the top destination is…
Travelers are forgoing a white Christmas for hikes, sand and sun this year.
"National parks … continue to win American travelers' hearts," Kapur said, however, "Hawaii is the most in-demand destination."
Vacation home site Vrbo told CNBC that in Maui and Kauai, both in Hawaii, less than 20% of its rental homes are available for the week of Christmas.
Interest in Hawaii slowed after Governor David Ige asked tourists to stay away from the islands last month, according to data from the travel booking website VacationRenter. However, holiday bookings there "skyrocketed" last weekend, said Zander Buteux, the company's head of organic growth.
"Bookings for Hawaii increased 100% over the Labor Day weekend — even with a potential lockdown on the horizon," he said.
Americans used the three-day weekend to book year-end travel to other domestic destinations too, said Buteux, most notably to Gatlinburg, Tennessee; Lake Tahoe, Utah; Breckenridge and Vail, Colorado; and Miami and Key West in Florida.
A representative from Florida's Palm Beach Marriott Singer Island Beach Resort & Spa said that more than 90% of its hotel rooms are booked for the December holiday period.
Summer spots, such as North Carolina's Outer Banks, are seeing an increase in holiday bookings.
"While the Outer Banks has been historically a summer destination, we continue to see increased demand for the 2021 holiday season," said Ross Twiddy, CEO of Twiddy & Company, a vacation rental firm in the area.
As of August, reservations were up 165% for the Christmas and New Year periods against 2017-2019 averages, according to the company. The lack of vacation homes left in December prompted the rental company to post a notice on its website's homepage that reads: "2021 is almost fully booked … booking ahead for 2022 is highly recommended."
Luxury bookings going fast
Ohana Real Estate Investors said December bookings are up the most in its highest-end hotels.
December leisure bookings are up 62% from 2019 levels at hotels such as Montage Deer Valley in Park City, Utah, the company said. Booking windows — or the time between reserving and starting travel — are now six to nine months, or nearly double that of 2019, at its high-end hotels.
Ohana partner James Cole said he believes luxury hotels are booking faster because wealthy travelers want to see family and friends and have something to look forward to at the end of the year. He said more people are spending more on travel now, especially during the festive period. Lastly, psychological factors are likely at play.
"I think travelers are speaking with their neighbors and realizing [they] have vacation plans already booked up for Christmas," he said. "Fear of missing out is very real at this moment."
Prepare to pay more
Procrastinating travelers can expect to pay more the longer they wait to book, said Cole.
Lower room categories sell out first, he said. And while cancellations are happening "on a daily basis" now, rooms may be released at higher prices closer to the holiday period, he said.
Contrary to popular belief, hotels don't want to sell out early, said Cole, who added that they prefer to have some rooms available for those "willing to pay a significant amount more."
Matt Clayden, a private client manager at the U.K.-based travel agency Intrigue Travel, is seeing similar price increases in Europe.
"Clients are expecting amazing deals and offers from both hotels and airlines, but in reality, it is the complete opposite," he said. "Flights and hotels are so busy at the moment that it is mainly the higher rooms and higher booking classes available."
People are staying in the U.K. this Christmas, or going to Barbados or Antigua in the Caribbean, the Maldives or Dubai, said Clayden. As in the U.S., many hotels are fully booked for the Christmas season.
Booking site Priceline estimates that average daily hotel rates have increased 14% compared with the 2019 holiday season. But Milepro's White said he believes online travel websites could cause prices to climb.
He told CNBC that during a weather-related power outage this summer, he called a DoubleTree by Hilton hotel, but was told the hotel was fully booked. He soon found an open room at the same hotel on a popular booking website. The price — $2,000 a night.
Holiday homes going higher
Vacation home rates are on the rise, according to the house rental management software firm Guesty.
Home rental rates on websites such as Airbnb, Vrbo, Expedia and TripAdvisor may be as much as 82% higher than what they were in 2019, according to the company.
"Christmas is projected to be the most expensive holiday period in the United States this year," said Guesty COO and president Vered Raviv Schwarz.
Travelers want options that aren't "traditional, crowded hotels," she said, adding that advanced bookings decrease inventory, which causes rates to climb even more.
Unlike hotels, Schwarz isn't convinced home rental prices will increase as Christmas gets closer.
"The booking of limited inventory may coincide with a holiday impacted by flu season and the delta variant," she said. "I assume we will see prices rise and dip depending on these factors."
Home and home rental price hikes, however, aren't happening uniformly across markets, according to VacationRenter. Data from the website shows that while winter rates are up in places such as California, Colorado and Hawaii, they have slightly dropped in Tennessee and Florida.
Booking into 2022
Several of the sources CNBC spoke to for this article said that bookings are going way beyond Christmas.
Travelers are "planning well into next year," said Similarweb's Kapur. "There have already been twice as many 2022 travel searches this year as 2021 searches last August."
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