Hotels continue to offer flexible cancellation policies, but as more people return to travel, some companies are requiring guests to give more notice if they want to change a reservation.

Choice Hotels International updated its booking and cancellation policy to require guests to cancel a stay 48 hours prior to arrival starting July 14, according to a company news release. Loyalty members will have a 24-hour window to cancel.

Douglas Lisi, vice president of revenue management at Choice, said some guests are canceling at the very last minute, making it harder for hotel franchisees to fill rooms.

The company's updated policy is "allowing our franchisees and our customers to get the best experience possible right now," he said.

Lisi said franchisees also want to maximize revenue and plan for staffing by knowing what the actual demand is "in a very short run, especially in a very labor-shortage market, to make sure they have the right staffing at the right time."

He added the change in the cancellation window, from 24 hours to 48 hours prior to the stay, allows customers booking at the last minute to find the "true inventory that's available in the marketplace."

With occupancy recovering more than expected this summer, "inventory management is as much of a challenge as it was in 2019 when U.S. hotel occupancy was within a few tenths of an occupancy point of the highest since 1981," said Bjorn Hanson, clinical professor with the NYU School of Professional Studies Jonathan M. Tisch Center for Hospitality and Tourism, in an email interview.

"As an example of the challenge of inventory management, one major branded hotel in New York with which I have worked experienced a pre-COVID combined cancellation and no-show rate of over 30%, a clear challenge for guest room inventory management and pricing," he said. "Many brands will reintroduce general cancellation policies very similar to those from 2019, but will allow managers of individual hotels authority to alter the policy for specific local market conditions."

Highgate Hotels has updated its cancellation policies on a market-by-market basis, Chief Commercial Officer Ankur Randev said. In some markets, where hotel demand is back to pre-COVID levels, its hotels require up to 72 hours notice to cancel.

Rather than changing cancellation policies across its portfolio, Highgate has concentrated on markets that have recovered more quickly, taking "stock of how demand continues to reach out to these markets," he said.

Randev said markets such as Key West and Miami have had "unconstrained demand."

"We started doing some fencing around the cancellations for these specific markets for two reasons. One is to make sure because of the demand ... we offer the accommodations to folks who are genuinely traveling," he said.

Randev said Highgate also noticed "acute labor planning issues across the industry," which contributed to the need to update cancellation policies.

He added that hotels in non-beach destinations will continue to lag in the cancellation reset.

Marriott International's website states the company has extended its flexible reservations policies "in response to changing marketplace conditions."

For existing reservations made before July 6, 2020, for any future arrival date, policies in place at the time of the reservation will be honored.

"For guests with reservations made on or after July 6, 2020, for arrival dates through August 31, 2021, we will allow the reservation to be changed or canceled at no charge up to 24 hours before the scheduled arrival date," the policy states on the company website. "Reservations with pre-paid rates and other limited exclusions will be subject to the rate offer rules communicated at the time of reservation. Please note that changes to the reservation will be subject to availability and any rate differences."

Marriott's global flexible cancellation policy was developed in early March 2020 and implemented in late September 2020.

Lorie Juliano, corporate director of commmunication, said Sonesta "returned to pre-pandemic cancellation policy as of June 1, 2021, for both group and transient bookings. For the most part, that means a standard 6 p.m. day prior to arrival when booked direct. ... There are a few exceptions driven by special events or other contingencies. We don’t have any intention to revisit systemwide at this point."

Wyndham Hotels & Resorts shifted back to standard cancellation policies in June 2020.

For reservations booked direct, the cancellation window varies but is 24 to 48 hours ahead of arrival for more properties. Certain rates such as advanced purchase cannot be canceled.

Hilton's website states that all properties offer flexible booking options with free changes and cancellations.

Most hotels allow guests to change or cancel a reservation up to 24 hours prior to arrival day.