I once stayed at some crappy roadside motel in Nowheresville, Georgia. The towels were thin, the toiletries the cheapest you can buy, the carpet worn, the bathroom held together by many tubes of caulk.
The room rate listed on the back of the entrance door? $399 per night.
Of course nobody in the history of that motel has ever paid more than 1/4 of the listed price for that room. It’s a total joke.
Here’s a photo of the price at Element Miami Airport I stayed in a few days ago when I had some meetings nearby. It was a fine hotel I’d gladly stay in again, with a great suite layout and a kitchen. When I search various dates for it online, the rate is usually around $150 or so. Let’s give them the benefit of the doubt and say sometimes they’re able to charge double that amount. But here’s what’s on the door.
The original idea behind this practice was to keep hotel management or front desk clerks from gouging you. Cities or states required the “rack rate” be listed on the door as the maximum. If anyone paid more than what was listed, they could complain and get compensated.
Follow the logic of how hotel owners are going to respond and you know how we got into this silliness. If the hotel must list its maximum rate, the owner/manager is going to pull a ridiculously high number out of thin air and post it as a pipe dream. Nobody ever complains because nobody will ever pay anything close.
When I go on Trivago.com and search Miami hotel deals, I get 168 hotels to choose from in Miami proper (apart from the beach). That’s what keeps prices in check: competition. When people can go on that site and see prices from nearly every booking site out there, do we really need this silly system anymore?