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The government of the Cayman Islands imposes a 10% surcharge on all hotel room rentals, which is included in the price.

Hotels also charge a room tax. The room tax depends on the quality of the hotel -- it might be relatively low for a guesthouse but steeper for a first-class resort. When booking a room, make sure you understand whether the price you've been quoted includes the room tax (which is different from the 10% hotel room surcharge), so that you avoid an unpleasant surprise when it comes time to pay the bill.

Furthermore, most hotels routinely add 10% to 12% for "service," even if you didn't see much evidence of it. That means that with tax and service, some bills are 17% or even 25% higher than the price that was originally quoted! Naturally, it's best to determine before you book just how much the hotel, guesthouse, or inn plans to add to your bill at the end of your stay.

That's not all. Some hotels slip in little hidden extras that mount quickly. For example, it's common for many places to quote rates that include a continental breakfast. Should you prefer ham and eggs, however, you will pay an extra charge. If you request special privileges, like extra towels for the beach, beach chairs, or laundry done in a hurry, surcharges may mount. It pays to watch those extras and to ask questions before you commit.

Hotels & Resorts -- Many budget travelers assume they can't afford the big hotels and resorts. But with so many packages out there and frequent sales, you might be pleasantly surprised, even in the winter.

The rates given in this guide are "rack rates" -- that is, the officially posted rate that you'd be given if you just walked in off the street. Almost everyone ends up paying less than the rack rate through packages, bargaining, and discounts. Think of the rates as guidelines to help you comparison-shop.

Some hotels are quite flexible about their rates, and many offer discounts and upgrades whenever they have a big block of rooms to fill and few reservations. The smaller hotels and inns are not as likely to be generous with discounts, much less upgrades. A good travel agent may know which hotels have reduced their rates and can help you save serious money.

Condos, Villas & Cottages -- Particularly if you're traveling with your family or a group of friends, a "housekeeping holiday" can be one of the least expensive ways to vacation in the Caymans. And if you like privacy and independence, it's a good way to go. Accommodations with kitchens are available on all the islands. Some are individual cottages, others are condo complexes with swimming pools, and some are private homes that owners rent out while they're away.

In the simpler rentals, you do your own cooking and laundry and, in a few cases, your own housekeeping. This may not be your idea of a good time in the sun, but it saves money -- a lot of money. The savings, especially for a group of three to six people, can range from 50% to 60% of what a hotel would cost. Groceries are often priced 35% to 60% higher than on the U.S. mainland, as nearly all foodstuffs have to be imported, but even so, preparing your own food will be a lot cheaper than eating all your meals at restaurants.

Most villas, condos, and cottages have a staff, or at least a maid who comes in a few days a week, and they also provide the essentials, including linens and housewares. Many places (though not all) include maid service and fresh linens in the price. Condos usually come with a reception desk and are often comparable to a suite in a big resort hotel. Nearly all condo and villa complexes have pools (some more than one). Like condos, villas range widely in price; a "modest" villa may begin at US$750 per week, while a luxurious one can go for over US$50,000 a week.

You can also rent a lavish private home. You'll spend a lot of money, but you'll be staying in the lap of luxury in a prime beachfront setting, usually with maid service (though you may need to arrange this in advance).

Approach all these rental properties with a certain sense of independence. There may or may not be a front desk with someone to answer your questions, and you will most likely have to plan your own watersports activities and excursions. Always ask when you book.

Make your reservations well in advance. Below, we've listed a few agencies that rent condos, villas, and private homes throughout the Caymans. You can also ask each island's tourist office for suggestions.

  • Cayman Villas (177 Owen Roberts Dr., Grand Cayman (tel. 800/235-5888 in the U.S., or 345/945-4144; www.caymanvillas.com), is a booking agency that rents more than 100 private beachfront homes and condos on all three islands. The properties range from cozy studio cottages to large villas that have as many as seven bedrooms. Some properties have the added luxury of a private pool or a maid, and sometimes even a cook. Most of the rentals have kitchenettes, Internet access, a washer and dryer, and kitchenware. Rentals range from budget to deluxe, so most pocketbooks can be accommodated. Prices range from US$150 to US$2,000 per night.
  • Villas of Distinction (tel. 800/289-0900 in the U.S.; www.villasofdistinction.com) offers upscale private villas, all with a pool, and one to six bedrooms throughout the Caymans. From town houses to beachfront villas, all their lodgings are beautifully furnished.
  • Hideaways Aficionado (tel. 888/843-4433 in the U.S., or 603/430-4433; fax 603/430-4444; www.hideaways.com) is a worldwide rental agency that also publishes Hideaways Collection, a pictorial directory of home rentals throughout the world, including the Cayman Islands. Rentals range from cottages to staffed villas. Hideaways Aficionado can also help you charter yachts and arrange cruises, flights, car rentals, and hotel reservations. Annual membership is US$195.

Online Bookings

In addition to the online travel booking sites Travelocity, Expedia, Orbitz, Priceline, and Hotwire, you can book hotels through Hotels.com, Quikbook (www.quikbook.com), and Travelaxe (www.travelaxe.com).

HotelChatter (www.hotelchatter.com) is a daily webzine offering smart coverage and critiques of hotels worldwide. Go to TripAdvisor.com or HotelShark.com for helpful independent consumer reviews of hotels and resort properties.

It's a good idea to get a confirmation number and make a printout of any online booking transaction.

You can often find some very good scuba-diving packages online, especially from late April to mid-December.

Note: This information was accurate when it was published, but can change without notice. Please be sure to confirm all rates and details directly with the companies in question before planning your trip.