The steep run-up in hotel room rates and occupancies in the United States' biggest cities is slowing as discouraged travelers seek alternatives to high-priced stays.

Business traveler Jason Womack of Ojai, Calif., for example, recently stayed with a colleague for his fifth night on a trip to New York City, saving more than $400.

When Jim Hibbard of Portland, Maine, saw $350-a-night rates at Marriotts and Hiltons in Washington, D.C., he instead stayed at a bed-and-breakfast on the edge of downtown for half the price. Paul Tamburelli of Phoenix is shortening stays and staying in out-of-the-way locations to beat big-city prices.

"Rates have gotten completely out of hand over the past four to five months," Tamburelli says.

Don't expect hotels to give you a break anytime soon. Industry forecasters such as Smith Travel Research expect rates to jump again next year. But there is some good news: Demand for rooms is stabilizing, so hotels won't be able to boost rates as much as this year.

"It's going to be interesting in 2007 to see how much rate leverage (hotels are) going to be able to retain," says Brad Garner of Smith Travel Research.

Growing resistance from consumers indicates that hotels are nearing "that magic ceiling" for rates, he says. In Manhattan, the nation's most expensive hotel market, the average daily rate reached a record $304 in September, the most recent month for which Smith has numbers.

Howard Solomon, who manages the 131-room Comfort Inn near the Empire State Building, says visitors have various strategies for avoiding high rates. Among them: staying in budget-priced hotels such as his or staying in New Jersey, where they can save $100 or more on a night's stay. Solomon's hotel is seeing its best performance in 10 years: 95 percent occupied at around $200 a night, on average.

"As long as the bigger hotels are still $100 or $200 more than me, I can keep raising the rates, because we're still a bargain for New York," he says.

Similarly, Hilton Hotels, which has the luxury Waldorf-Astoria in New York, sees no reason to stop raising rates. The conversion of The Plaza — once Waldorf's No. 1 rival — into a condominium/hotel gave the Waldorf more control because it eliminated direct competition, spokesman Marc Grossman says.

Manhattan sticker shock isn't limited to tourists and traveling salesmen. Emily Durso, president of the Hotel Association of Washington, D.C., has upcoming business in New York. She'll stay one night because the only room she could find costs $480. "I'm in the business, and that's the best I can do," she says.