OK, I have been obsessing about our next Caribbean vacation for quite some time. In that time, I have seen the prices drop at all the best hotels. Many are now offering a 4th night free with 3 nights (over spring break in March!). So now, of course, I'm wondering, will they drop even further? What do people think? The economy surely isn't improving, why shouldn't the prices continue to fall?

If my crystal ball was that clear I'd know how to invest my money so I'd be a millionaire several times over. I doubt anyone can tell you definitively if hotel/resort prices will go lower or higher. All one can give you is speculation and if you rely on that you may miss out on good opportunities.

From what I've seen and based on conversations I've had with several resort managers in the Caribbean they are already discounting their
product to where they are barely covering their fixed costs and it's doubtful further reductions will be forthcoming. You have to realize that the resorts just can't "give things away". If they did they would be out of business quickly.

Your best bet is to monitor prices for accomodations at a few resorts that you would like to visit and when you see what looks like a good price make your reservation.

Well...I guess I would book a hotel now at a good price and make sure that the hotel allows cancellations and refunds such that I could cancel and rebook if the price continues to fall.

Cancellation/refund policy is usually in small print, so be extra careful when trying this method. BUT...I have used it many times and saved a lot of money, most recently about 50% on a hotel in Mexico.

I agree with the others. I'd book something you can cancel now especially if you have set dates that are during peak period.
Those offers you've seen are to tempt people to travel and I think there will be some that will jump on a good deal. Then the hotels might increase their prices as soon as they have a certain number of rooms sold.

Here's an example; Marriott sent out an offer that listed several NYC hotels at discount prices in 2009 if you booked early (by Dec 31st I think). Well, I missed the deadline and checked and the prices are way up again.

Based on articles I've read, the prices will continue to drop, though the "price" may be in the form of a resort credit, free nights, etc., as I think that is the preferred discounting method of top shelf hotels.

I would book something that you can cancel, but keep checking back with hotels. If there is a particular one you want to stay at, I'd call directly to see what deals they have. You may be able to get something ever better that way if they need business!

I'm a Caribbean hotelier, and can honestly say that my crystal ball is cloudy too...my best guess is that there will be more deals for the summer and fall months, but if one is looking for winter deals, not sure if things will change much.. but deals are already out there.

One thing that is very much to the travellers advantage is airfares...am seeing fares to Cayman from major cities for about $400....when the same cities and the same time of year last year ran up to $1000.

Low airfares will make a much bigger difference than hotel deals this summer, particularly for families.... silver linings, people