Is Redeeming Points for Domestic Flights Better Value Than International?

Many Australians save their frequent flyer points to use for long-haul flights, ideally in Business Class. Not only are international flights in premium cabins an aspirational reward, but they’ve traditionally been a great value way to use your points.

This may be controversial, but I’m now finding it’s often better for me to spend my points on domestic flights instead. I’m not alone.

“Personally I use VA points for my regular domestic flying, and bank that money towards buying an international fare for cash,” one Australian Frequent Flyer member said in a recent forum discussion thread.

Another AFF member replied:

This is a good point. I was only talking to my wife about this the other day. We have always saved our points for international travel and now (especially with the new system) I think we might do as you have suggested and do it in reverse. Last year we spent $13000 on domestic travel $6000 on international. I am pretty sure after doing the sums we will be better off paying for our international travel (in J) and then using the points for domestic travel.

I think this is worth breaking down further…

Better reward seat availability

If you want to redeem your points to book a domestic flight, either in Economy or Business Class, there’s a good chance you’ll be able to find a suitable flight. You might even be able to find reward seats for your entire family.

Sure, you might not be able to redeem points the exact domestic flights you want every time. And reward seats can be more limited if you’re booking at short notice, or during school holidays. But given the high frequencies on many domestic routes, you can usually find something that’s close enough.

When’s the last time you looked for Business Class reward seats on a long-haul international route, and actually found availability on the flights you wanted?

In fairness, if you have points with an overseas frequent flyer program like KrisFlyer or Cathay, or flexible credit card reward points, you might have actually been successful! But if you mainly collect Qantas or Velocity Points, I can guess how you probably answered that question…

Better value

AFF recently published our Frequent Flyer Point Valuations, which show the average value of a point in different airline programs. To come up with our final valuations, we calculated the value you’d get for your points when redeeming for a wide range of different rewards. These included a mix of domestic, short-haul international and long-haul international flights in both Economy and Business Class.

I would have expected the long-haul Business Class redemptions to offer the best value on a “cents per point” basis. This was not necessarily the case.

There are certainly some great value long-haul redemptions out there… if you can find them. For example, I recently used my Qantas Points to book a Classic Reward in First Class Sydney to Johannesburg, which was great value.

But I was quite surprised to find that you’d get barely more than 2 cents per point worth of value when redeeming Qantas or Velocity Points for Business Class flights from Australia to Germany. The value of a Velocity Business Class redemption from Sydney to Singapore was also barely over 2 cents per point.

That’s not terrible. But you could get similar value when redeeming for many domestic flights within Australia. For example, a Business Class redemption from Sydney to Brisbane is typically worth around 2 cents per point, or similar for an Economy seat from Melbourne to Canberra. On some regional routes where airfares are normally high, the value is even better.

On some short-haul international redemptions, like to New Zealand or Bali, the value you’d get for your points was actually much less than 2 cents each.

Why aren’t long-haul redemptions better value?

There are two main reasons why Business Class redemptions to Europe – at least, when using Qantas or Velocity Points – are no longer quite the great deal they used to be.

The first reason is that the carrier charges can be really quite high in some cases. When using Qantas Points to fly Emirates Business or First Class from Australia to Europe, for example, the taxes & charges on a return ticket are close to $4,000.

The second reason is that Qantas and Velocity now charge quite high amounts of points, relative to other programs, for long-haul reward seats.

In the unlikely event that you actually find availability, you’d pay around 365,800 Qantas Points (plus taxes & carrier charges) these days to fly from Australia to Europe on Qantas partner airlines. Velocity charges 317,000 points, plus taxes & carrier charges.

If you had Avios, you could fly Qatar Airways’ excellent Business Class from Australia to Europe via Doha for just 180,000 Avios round-trip (plus taxes & charges).

Meanwhile, Cathay charges 230,000 Asia Miles (plus taxes & charges) to fly round-trip from Australia to Europe via Hong Kong in Cathay Pacific Business Class – and you can often find seats, too. Plus, it costs not many more Asia Miles to book the leg from Hong Kong to Europe in First Class.

When you spend cash, you can just book whatever flights you want

Even if you could find Business Class reward seats to Europe using your Qantas Points on your preferred travel date, what are the chances they’re on your preferred airline and with short connections?

Sometimes you’ll get lucky and might find a unicorn First Class reward seat on QF1 to London. If you do, that’s great – you should totally book it if it works for you! But, having helped people redeem their Qantas Points to get to Europe for many years, I can tell you that the best available flights during peak periods like the European summer usually involve multiple long layovers.

It’s not uncommon to find that the best available itinerary on your preferred travel date is something like this:

If you redirect the money you save by redeeming points for domestic flights towards a long-haul Business Class flight, you might end up spending roughly the same amount of money overall. But for your flights to Europe, you can simply book whichever flights are the most convenient for you on whichever airline you like!

You have a lot more options when you’re not bound by award availability.

Tips for finding cheap long-haul Business Class airfares

Return Business Class flights from Australia to Europe on full-service airlines typically hover around the $8,000-12,000 mark. But you can often fly Business to Europe for much less than this using the strategies covered in this article.

I’ll also cover lots of tips for saving money on Business Class airfares – including to Europe, and other destinations – in next week’s AFF webinar! This webinar is open to all AFF Gold and Platinum members. Click here to learn more about AFF memberships.

Buying points with overseas airlines

Alternatively, you could use the savings from redeeming points on domestic flights to buy points with an overseas frequent flyer program like Aeroplan that does offer good award availability on the international flights you want to book. As AFF member MEL_Traveller explained on our forum:

My regular – weekly – flights used to be MEL-SYD business class, $700 for the return. Using point for those flights was pretty easy and meant the $620 saved (after VA charges) would buy me 30k aeroplan points when on sale. 45k aeroplan points gets you one way to anywhere in southern asia business class. Redeem 3 MEL-SYD returns on points and I had a return business class to Bangkok on thai or singapore airlines.

Why try to fit a square peg into a round hole?

I’m a firm believer in joining multiple frequent flyer programs, and using each program to its strengths. Using Qantas or Velocity Points for domestic flights often makes sense, so I do that. There are also certain international routes where it does make sense to spend Qantas and Velocity Points, so I do that. But I don’t try to use points in ways that they’re not intended, if that really doesn’t make sense.

Do you use your points for domestic flights and use the savings to buy international tickets? Let us know on the AFF forum!