A win for visitors and staycationers, New York City is abolishing hidden hotel fees and surprise credit card holds.
On January 21, newly sworn-in Mayor Zohran Kwame Mamdani announced the shake-up, set to impact the city’s tourism. A press release noted that the purpose of banning hotel junk fees is to provide consumers with a more transparent understanding of their overall hotel booking expenses. Starting February 21, a hotel room’s advertised price will include all mandatory fees. You will also see a disclosure if a hotel places a credit card hold or requires an advance deposit.
The new rules apply to NYC hotel bookings and to accommodations advertised to New York City residents, regardless of location.
The Big Apple is currently hosting its annual “NYC Hotel Week,” running discounts at some of its top hotels from January 12 through February 12. Moreover, the city anticipates hosting an influx of summer tourists arriving for the FIFA World Cup. The latter will include matches and the final at the nearby MetLife Stadium in New Jersey.
During a press conference, Mamdani thanked council members for working hand in hand with the NYC Department of Consumer and Worker Protection (DCWP) to implement the changes on hotel junk fees.
“Whether you’re visiting the five boroughs for the World Cup or leaving our city for a well-deserved vacation, you deserve to know how much a hotel costs up front. This new rule will ensure that New Yorkers and visitors alike are not stuck paying hidden hotel fees, and will instead save millions of dollars each year,” said Mamdani. “In just three weeks, our administration has made it clear that deceptive business practices do not have a home here — and that City Hall will always fight for New Yorkers to know exactly what they’re paying for.”
How Much Money Will The Ban Save People?
Hidden and junk charges can be insidiously marked as “destination,” “hospitality service,” and/or “resort” fees added to a hotel booking. Economists at Stanford University believe that the Mamdani administration’s ban on junk fees could save consumers time and money.
“Using the Federal Trade Commission (FTC)’s framework and updating it for the number of bookings covered by the NYC rule, we estimate that eliminating these junk fees will save consumers between $46.4 and $67.4 million in 2026 by reducing the time spent searching for hotel rooms. Of this, $24.7 to $35.9 million will accrue to NYC residents from their nationwide bookings, and $21.7 to $31.6 million will accrue to U.S. consumers located outside of New York City from their NYC bookings,” said colleagues Neale Mahoney and Daniel Posthumus in a Substack post.
“These figures are lower bounds; they do not account for consumer savings from bookings they otherwise would not have made had prices been transparent, nor for any savings from the competition-enhancing effects of transparent pricing,” they added.
