2025 Travel Savings: Airfare Trends and Budget Tips

As travelers start planning their 2025 vacations, many are focusing on finding the best deals on flights and hotels. Recent data suggests that cost will play a major role in determining destination choices, with 51% of Americans saying that flight prices will influence their travel plans, according to Skyscanner. In addition, hotel costs also factor into destination decisions for half of U.S. travelers.

Recent analyses from industry data providers such as Kayak and Hopper reveal mixed trends in airline fares. On the international front, airfare in 2025 is about 4% lower than last year, offering some relief for globetrotters. This decrease comes as airlines expand flight routes and adjust pricing post-pandemic, with the Asia-Pacific region emerging as a particularly attractive destination for bargain hunters. In contrast, domestic flight prices in the U.S. are expected to be 3% higher compared to last year. Hopper data shows that domestic fares in January are approximately 12% higher than the same month last year and are expected to remain above previous levels until at least mid-2025.

Experts believe that these price fluctuations are partially due to the rapid recovery in travel demand. After a period when U.S. airlines “flooded the market” with seat inventory, domestic fares in 2024 were incredibly low, which is not expected to continue into 2025. “Overall, it’s going to be a more expensive year than last year for domestic travel,” noted Hayley Berg, lead economist at Hopper.

However, travelers aiming to venture abroad may find better deals in 2025. Kayak’s internal search data shows that roughly two-thirds of all flight searches for travel this year involve international flights. Long-haul fares to Europe, South America, Oceania, and particularly Asia are either flat or lower compared to previous years, making an international vacation an appealing alternative despite the higher average cost of round-trip U.S. flights abroad. For instance, while a domestic round-trip flight may average around $300 in January, international trips are priced higher—at about $750 to Europe or even $1,100 to Asia—but the relative drop in airfare for Asia is striking. Average fares to Asia have declined by 7% year over year, making the region one of the best bargains available.

Hotel rates, on the other hand, appear to remain largely similar to 2024 levels, both abroad and within the U.S. Additionally, rental car prices are slightly on the rise, with international rates up 8% and domestic rates up 4%. Yet, when planning a vacation, it is not just the base prices that count. Factors like seasonality and alternative booking strategies can result in considerable savings. Established travel experts like Sally French from NerdWallet advise that flexibility is essential—choosing to fly midweek, booking during off-peak periods, or considering alternative airports can reduce costs significantly. For example, booking flights two to eight months in advance for international travel can secure lower fares compared to last-minute deals, which are rare.

Lastly, booking directly with hotels instead of through third-party sites may offer additional advantages, such as price-match guarantees and loyalty discounts. Setting flight alerts on platforms like Google Flights or Hopper can also help travelers take advantage of fare drops the moment they happen.

While domestic travel may be slightly more expensive in 2025, international journeys, particularly to the Asia-Pacific, offer promising savings. With strategic planning and flexible travel dates, budget-savvy travelers can navigate the new market equilibrium and enjoy memorable vacations without breaking the bank.

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Sources: AirGuide Business airguide.info, bing.com, cnbc.com