There are many different ways to account for why Chase Ultimate Rewards is the most popular transferable points currency. There’s the 5/24 rule, which incentivizes people to apply for Chase cards first. There’s the Chase Sapphire Preferred Card, which was the unequivocal starter card for someone new to the points hobby for years. There’s the fact that Chase defines its bonus categories relatively broadly compared to Citi and Amex, and there’s also the fact that Chase has an array of valuable transfer partners.
However, today’s article will look at one specific area in which the program has a significant competitive advantage: using points for hotels. There are a handful of different ways to put your Ultimate Rewards points towards your next hotel stay, and any of them could make sense under the right circumstances.
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Earning Ultimate Rewards Points
Of course, to redeem Chase points for hotels, you have to earn them first. The easiest way to earn a meaningful number of Ultimate Rewards points is by using one (or more) of the issuer’s credit cards. There are a few great sign-up bonuses currently available:
- Ink Business Preferred Credit Card: Earn 100,000 bonus points after you spend $15,000 on purchases in the first three months.
- Chase Sapphire Preferred Card: Earn 60,000 Ultimate Rewards points after you spend $4,000 on purchases in the first three months from account opening.
- Chase Sapphire Reserve: Earn 50,000 Ultimate Rewards points after you spend $4,000 on purchases in the first three months from account opening.
In addition to generous sign-up bonuses, these three cards offer a compelling earning scheme for everyday spending. The Sapphire Reserve offers 3x points on travel (excluding $300 travel credit) and dining purchases, while the Sapphire Preferred offers 2x points in those same categories. You earn 3x points on the Reserve and 2x on the Preferred on up to $1,000 in monthly grocery purchases through April 30, 2021. And you can use the Chase Sapphire Reserve’s $300 credit on gas and groceries through June 30, 2021.
Meanwhile, the Ink Business Preferred awards you 3x points on the first $150,000 in combined travel, shipping, telecommunications and select advertising purchases each account anniversary year. Chase also has its own online shopping portal, allowing you to boost your earnings even further.
Note that if you have any one of these three cards, you can also combine your Ultimate Rewards points from cards that carry no annual fee (such as the Chase Freedom Flex or Chase Freedom Unlimited). Even though these cards are technically cash-back ones, carrying one of the above cards allows you to effectively “convert” your cash-back earnings into fully transferable Ultimate Rewards points.
Once you’ve earned a healthy amount of Ultimate Rewards points, how do you put them to use for free hotel stays? Here’s a run-down of your options.
Related: The power of the Chase Trifecta: Sapphire Reserve, Ink Preferred and Freedom Unlimited
The World of Hyatt
Chase’s secret maximization weapon is undeniably the World of Hyatt loyalty program, a 1:1 transfer partner. While most conversations about redeeming flexible points for maximum value center around airline transfer partners, Hyatt’s reasonably priced award chart is a very compelling exception. You’ll find sweet-spot redemptions at both the upper and lower ends of the chart, with free night awards starting from just 5,000 points per night.
Sometimes it can be hard to conceptualize what a 50,000-point sign-up bonus will actually get you, especially if you’re new to the points world. Hyatt makes it easy, as that sign-up bonus could be worth 10 nights at Category 1 Hyatt House hotels in big cities around the world, such as Chicago, Dallas, Beijing, Kolkata and even Bali.
Another easy way to redeem your Hyatt points well above TPG’s 1.7 cent valuation is to look at top-tier Category 7 hotels. While the award chart above has a higher tier (Category 8), it isn’t actually as ominous as it might seem. This elevated tier was added to accommodate some of the Small Luxury Hotels of the World (SLH) properties with which Hyatt started partnering in 2018. Hyatt has even said that there are no plans to move Hyatt branded hotels (Park Hyatt, Grand Hyatt, etc.) up to Category 8.
There are several luxurious Park Hyatt hotels in Category 7, and I’m a big fan of two in particular that are absolute steals at only 30,000 points a night. These would be the Park Hyatt Sydney and Park Hyatt New York, which often sell for several hundred dollars a night (or more) during peak season. This means your 30,000-point redemption will net you about 2.6 cents per point, above TPG’s valuation of both Hyatt points and Chase Ultimate Rewards points.
© The Points Guy
© The Points Guy
Finally, I’d look hard at the 150+ luxury resorts from SLH that have now been integrated into The World of Hyatt program. In some cases, 40,000 Chase points transferred to Hyatt could snag you a villa that covers thousands of square feet in remote locales such as the Viceroy Bali or the Amani Boutique Hotel in Zanzibar, Tanzania. We expect more of these resorts to be added, giving you even more redemption spots for your Chase points.
Related: How long do Chase Ultimate Rewards take to transfer?
Unlike Amex and Citi, which routinely offer transfer bonuses to select partners or even permanently increase transfer rates, Chase has pretty much always had a 1:1 transfer ratio for all its 10 airline and three hotel partners. You might think this is a generous decision, and with Hyatt, it works out in your favor.
However, many hotel chains have award charts with much larger (one could argue inflated) point values. While the most you’d ever pay for a free night at a top-tier Hyatt property is 30,000 points (or 40,000 for select SLH properties), Marriott’s top hotels currently cost 85,000 points a night and will cost up to 100,000 points during peak pricing.
Generally speaking, this means that transferring Chase Ultimate Rewards points to Marriott represents a significant loss in value. TPG values Ultimate Rewards points at 2 cents each and Marriott points at 0.8 cents each, but you could give up even more value. For the same number of Chase points as a $1,000+ room at the Park Hyatt Maldives, you could book two nights at the Courtyard Bali Nusa Dua Resort.
So does it ever make sense to transfer Chase points to Marriott? With the arguments against doing so clearly laid out for you already, here are a few scenarios where it might make sense:
- If your Marriott points are set to expire, transferring 1,000 Ultimate Rewards points is a quick way to keep them alive.
- If you made a Points Advance reservation with Marriott and weren’t able to earn enough points to pay for it in time, redeeming Ultimate Rewards points to make up the difference might be better than losing your award space.
- Marriott points are incredibly versatile beyond hotel bookings. That’s because Marriott is the only transfer partner for some valuable but hard to earn airline miles such as Alaska Airlines MileagePlan and Korean Air SkyPass. If you’re trying to make a transfer from Marriott to Alaska to book Cathay Pacific or JAL first class or to Korean for a specific award redemption, it might be worth transferring points from Chase to top up your Marriott account if you’re short. Remember that Marriott points transfer 3:1 to airline partners, so you’ll be losing even more value, but if you’re just shy of the points you need to book one of these sweet spots, it might make sense.
Related: Why I’m no longer chasing Ultimate Rewards
IHG Rewards Club
For all the reasons that transferring Ultimate Rewards points to Marriott is bad, transferring to IHG can be even worse. Not only do you not have any airline transfer partners, IHG’s award chart is even more inflated than Marriott’s, meaning the same number of points don’t get you as far. In addition, the program doesn’t even publish a full chart. To check the rates, you need to search for your specific dates and see how many points you’d need.
For example, if you wanted to book one night at the InterContinental Willard Washington, D.C., you’d have to shell out 70,000 points a night.
Now the InterContinental Washington D.C. is a stunning luxury hotel, but for 70,000 Ultimate Rewards points, you could book free nights at some hotels that are truly over the top and out of this world.
Like with Marriott, you might find value in transferring Chase points to IHG to keep points from expiring or if you’re just short of a redemption, but it’s almost always a bad idea.
Related: Why do Chase and TPG list different values for Ultimate Rewards points?
Chase Portal/Pay With Points Bonus
If you’re a free-agent traveler and not loyal to a single hotel chain, you might find the best value options by booking your hotels directly through the Chase travel portal. This is especially true if you hold the Chase Sapphire Reserve, which allows you to redeem points for travel at a rate of 1.5 cents apiece, or the Chase Sapphire Preferred Card, which allows redemptions at 1.25 cents apiece.
The one important thing to note is that these bookings are similar to those made through a third-party, online travel agency: you won’t earn hotel points or hotel elite night credits in most cases. If you already have elite status, you might not receive the benefits which you’re used to enjoying.
That said, the rates speak for themselves, and Washington, D.C., is actually a great example. Why pay 70,000 points a night for the InterContinental when you can pay less than 27,000 instead? How about just over 38,000 for the Ritz-Carlton instead of the 60,000 points that Marriott would require?
However, note the rate on the Grand Hyatt Washington. As a Hyatt Category 4 property, this property would require just 15,000 World of Hyatt points for a free night. Instead of paying 27,600 Chase points through the issuer’s portal, you can transfer 15,000 points to Hyatt and book an award stay there.
You can also use the Chase portal to stay at boutique and non-chain hotels, such as the infamous Watergate Hotel in DC. 16,000 points a night to sleep in such a historic building is an absolute steal.
You can also use this strategy in vacation spots like Bali, the Maldives and Hawaii to find great accommodations that you might have overlooked if restricting your search to hotel chains. There are plenty of markets around the world where using points for hotels is hard. But even in Huangshan, China’s remote Yellow Mountain range, the Chase portal has plenty of options that range from affordable to luxurious.
Even if you’re redeeming Chase points for top category hotels, you’re not going to get the same massive redemption values that typically come with first or business class flight awards. However, that doesn’t mean there aren’t good options. One of the best uses of Ultimate Rewards points is transferring them to Hyatt and redeeming them at low-category or high-end properties. Outside of that, given the high award rates of Marriott and IHG, you might be better off looking at boutique properties (or forgoing your elite benefits) by booking directly through the Chase portal.
Additional reporting by Benét J. Wilson
Featured photo of the Nobu Hotel Marbella courtesy of Hyatt
SPONSORED: With states reopening, enjoying a meal from a restaurant no longer just means curbside pickup.
And when you do spend on dining, you should use a credit card that will maximize your rewards and potentially even score special discounts. Thanks to temporary card bonuses and changes due to coronavirus, you may even be able to score a meal at your favorite restaurant for free.
These are the best credit cards for dining out, taking out, and ordering in to maximize every meal purchase.
Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.
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