The room below the median is 44 cents

Four prices in Tulum, and three of them inside a dollar

On 7 October our engine read what hostels in four cities were asking for a dorm bed. It does this every morning: open the public Hostelworld city page, take the listings on it, record the asking price for the sampled night most of them priced. Nothing below is modelled or estimated. Every figure is USD, per bed, per night.

• Tulum: 31 listings, 4 priced for the night of 17 October. Cheapest 8.59, median 9.03, dearest 28.75.
• Puerto Escondido: 30 listings, 7 priced for 10 October. Cheapest 12.66, median 14.92, dearest 20.29.
• Cuzco: 30 listings, 7 priced for 10 October. Cheapest 8.60, median 13.59, dearest 26.86.
• Arequipa: 30 listings, 6 priced for 10 October. Cheapest 8.90, median 10.14, dearest 12.05.

Start with Tulum, because four prices is few enough to take apart by hand. With four prices the median is the average of the second and the third, so those two add up to 18.06. The cheapest is 8.59, which puts a hard ceiling on the third: it cannot be above 9.47. Three of the four hostels with a public price that night were standing inside a band 88 cents wide. The fourth was at 28.75.

The room below the median, and the room above it

The median on its own decides nothing. What matters for the next move is how much room sits on each side of it. In Tulum, below the median there is 44 cents. Above it there is 19.72.

It held in all four cities that morning:

• Tulum: 0.44 down, 19.72 up. Up is 44.8 times down.
• Cuzco: 4.99 down, 13.27 up. Up is 2.7 times down.
• Puerto Escondido: 2.26 down, 5.37 up. Up is 2.4 times down.
• Arequipa: 1.24 down, 1.91 up. Up is 1.5 times down.

Arequipa is the tightest of the four, the whole readable market inside 3.15 dollars, and it is still wider on top than underneath. In every one of these cities the discount is the short move and the premium is the long one.

What a 25-bed house can actually give away

Put a 25-bed property exactly at its city's median and cut to the floor, matching the cheapest price on the page. To take the same money as before it needs 5.1% more beds sold in Tulum, 13.9% in Arequipa, 17.9% in Puerto Escondido, and 58.0% in Cuzco.

The Tulum number looks easy and it is the one to watch. Five percent is one bed in twenty. But you gave up 44 cents on every other bed to get it: 25 beds at 0.44 is 11.00 off the night. The whole move turns on that one booking arriving, and if it does not, you are down 11 dollars and the page now says you are the cheapest hostel in Tulum.

The harder limit arrives before you are full. Past a certain occupancy no discount pays itself back, because standing still would need more beds than the building has. For the cut above, that point is 16 beds of 25 in Cuzco, 22 of 25 in Puerto Escondido and Arequipa, and 24 of 25 in Tulum.

Cuzco is the one to sit with. Its floor is 36.7% under its median, the kind of gap that looks like a market telling you to move. A 25-bed property already selling 16 beds at 13.59 takes 217.44 that night. At 8.60, that same 217.44 needs 25.3 beds. The building has 25. No occupancy makes the cut whole.

What the top of the range is worth

Run the arithmetic upward. One bed sold at the dearest price on the page instead of the median brings, in Tulum, 19.72 more, the same money as 2.18 extra beds at the median. In Cuzco that bed is worth 0.98 extra beds, in Puerto Escondido 0.36, in Arequipa 0.19.

Two of those are small and two are not, and that is the use of the read: it tells you which kind of city you are pricing in before you spend a season finding out. Where the top is two or three times the middle, whatever justifies sitting up there, a four-bed room that feels private or a late checkout, is worth more than any discount available to you. Where the whole market is three dollars wide, the rate is not your lever: the commission is, and the direct booking, and the margin per occupied bed on everything that is not the bed.

The move this points to

In a city shaped like Tulum or Cuzco, stop working the bottom two dollars of your range and start testing the top. Take the three nights next month you already expect to fill, put the lowest dorm 15% above today's price, and read what the booking pace does. You are not guessing about the floor while you do it: you know where it is, in cents.

What our own engine did with a number like this

On our own hostel in Oaxaca, the part worth repeating is what the engine refused to do. It had learned its way to a near-term discount of 8%, in three-point steps. Then it read its own history: 23 days at minus 8% averaged 33.7% occupancy, five days at 0% averaged 42.0%. Deeper was not filling. It held, and has not widened the cap since. Of its first 32 logged runs, 19 deepened, 13 held, none lifted.

What this read is and is not

Four to seven prices is a handful, not a market, and a median built on six numbers moves if one property moves two dollars. The dearest price can be a different product read as a dorm bed: a four-bed room, or a pod. Tulum's night was 17 October, ten days out, while the others were 10 October, three days out, so comparing levels between these cities is weak evidence. That is why every comparison above sits inside one city, on one night, from prices read in the same hour. We publish aggregates only, never a hostel's name beside its price, and none of this says anyone's price is wrong.

Nightfill reads this every morning and rewrites rates off the back of it, five lead-time bands a day, inside a floor and a ceiling you set. If that is the job you want off your desk, the three tiers are here: view pricing. Nightfill is independently operated and results vary by property, market and season.

The same read, for your property

You do not need to buy anything to check any of this. Paste your Hostelworld listing at nightfill.co/#read and the same reading for your own hostel arrives by email in about ten minutes: your cheapest dorm bed against the other hostels in your city, night by night across the next 30 days, your rank from cheapest, and the nights you sit above your city's median.

When it lands, measure both sides: your price to the floor, and your price to the ceiling. Then ask which of the two you have worked on all year.