Confused by Hilton point value
 

No reason to be confused. Just spend points as quickly as possible.

A company that launches a points sale the day before they raise the prices on rewards at several hotels - with no notice - is simply not to be trusted or to have their points "valued" in any sustainable way.

Why do I say it that way? Because if you value a point at 0.5 cents and choose NOT to spend them at a hotel offering 0.4 cents, it is because you expect to get more than 0.5 cents at some point in the near future at a different hotel. If you cannot count on that, then spend points at any valuation. The same way you would spend Venezuelan or Zimbawean money as soon as you had it in hand - wait a week and it's not worth the same...

I usually spend cash below $.005 per point redemption.

I get the most value out of large price stays. So unless I see a compelling reason, I won't spend on an approx $100 stay unless its a great redemption (20,000 points).

But, if its an expensive hotel, and I want to stay in my budget, but also want to stay there, I will sometimes use points even with a $.005 per point redemption.

It's a tricky one isn't it........ math has never been my strongest point but what works for me is batting some points at the more expensive Hilton's....... I often stay in London Bankside and the Waldorf these are nearly always £220 plus....... if I bat say 30k of points at the price it brings it down somewhat.
I'm not sure if this is the optimum bargain , probably not but i kinda like doing this.....oh and it's still cancelable.

You would want to redeem higher than your valuation. If, like me, you value at .4 cpp, a "good" redemption is anything higher than that (e.g., more than .41 cpp).

I'd suggest redeem even just below your evaluation. If you value at 0.4, spend at 0.35 or better. Or maybe even at 0.2 (Hopefully not, but... I'm exaggerating with the 0.2 reference). Adjust further below or at based on how many you have. The reason to spend below is because they're always devaluing them every few months. So it's stupid to throw more money at them and lose $$$$$ on the next devaluation.

It's not that hard to find redemptions at .4 cpp or higher. IMO it's a waste of points redeeming lower than that.

It's actually hard to find better than 0.4 cash value if you discount the point redemption value appropriately.

if it costs $100 cash or 20k points, that is NOT 0.5 cents / pt value. If you paid cash you would earn ~$20 in points. That makes the $100 vs 20k points work out to only 0.4 cents.

The other challenge is to compare with best rate, be that MVP/AAA/etc not with BAR that Hilton uses for the dynamic valuations.

Sure, there are exceptions (fewer every day), primarily at the most expensive properties that still have a point cap and haven't artificially disallowed "standard rewards". In my limited travel, I've even seen regular Hampton inn or Hilton garden inn where standard award are available but no point redemption options. Phoning in, they offer to book with points but price them out way above the normal "cap".

I have some examples with numbers in a recent post which came out to a consistent $0.0036/pt across the standard award examples for the "best" redemption values in my city.
https://www.flyertalk.com/forum/30069949-post13.html
5th night free would obviously boost values by 20%, but would require someone to make long stays.

No, it can be challenging to find redemptions over .5 cpp if you value the points properly. Over .4 is really not difficult.

But if you want to redeem at less than .4 cpp, that's entirely your call.

Not quite a fully accurate calculation, but yes that's definitely the correct way to look at it. You are right to compare the total including all fees. You are using a 5 night stay, so getting 20% better due to 5th night free. Additionally, your stay is at the point cap for the property, which is the second way you can get above the dynamic pricing. The third would be avoiding resort fees. But refer to recent threads -- They have been removing or increasing some of said caps. I've also myself seen properties just disable point redemptions online on standard rooms and call-in gets a dynamic (higher than cap) point price option when the room rate is higher than their "normal".

However, IF I paid $846.72, I would ALSO receive at least 44 pts/$, or 37224 points.

So, you DONT actually have 120k points = $846.72. The more accurate equation is actually "120000 points = $846.72 - 37224 points". Basic math equation, add 37224 points to each side so you have just $ on one side and you can then solve for $ per 1 point, "157224 points = 846.72". Divide by 157224 on each side and you have "1 point = $0.00539". Value per point in your example for me would be at most $0.00539. Is this clear what I'm saying now? If you have the aspire card, the value per point in your example is really at most 5.39 cents per point, NOT over 7 cents.

IF someone is never/rarely going to be using a 5 night stay, your same example would work out to $0.045 per point. If you like 5 night stays or are even able to commonly use 5 night stays, then yes, of course adjust up the value to what it works out to with the 20% bonus to the point value. I've stayed in a single hotel for 5 or more days exactly two times so far in my life.

The reason one may want to "use" points a little below the value one has calculated them at is twofold: Hilton has repeatedly made incremental point devaluations. If you keep a big balance and don't ending up using them, they will decrease in value. The second is harder to explain but there's an opportunity cost or time value of money. This one hits me as I don't travel that much but have about 700k points, worth over $3k. I've had 500k points for more than 4 years. If i'd have spent all those immediately, I'd have had extra $$ in the bank which I would have invested. I would have had 4 years of returns on those investments. In my case I like to use 8%/yr for opportunity cost estimates.

Agreed this is currently easy using the 5th night free. But that requires the stay lengths to be evenly divisible by 5 nights.

It does not require 5 nights free. I'm sitting right now at HGI Monterey (Monterey Jazz Festival) on a redemption that pencils at about .6 cpp on a two night stay ($360 room for 60k points). My last redemption, at Conrad HKG, was one night right around.5 cpp. These are both above average for Hilton, but again, .4 cpp is not challenging.

TPG values Hilton points .6 cpp, that of course is ridiculous.