Overselling is not a mistake. It is a deliberate revenue practice: hotels forecast how many confirmed guests will not turn up and sell past their room count to cover the gap. Most nights the forecast holds. On the nights it does not, somebody with a confirmed reservation arrives to be told their room is not available, and is sent to another hotel. The industry calls that being walked.
The Short Answer
You are entitled to a refund of what you prepaid and, in the United States, nothing more: no regulation covers oversold hotels. Anything beyond the refund comes from brand policy. Marriott pays US$200 and 140,000 points at The Ritz-Carlton and St. Regis, but only to its top two elite tiers and only if you gave your member number when booking. Accor pays for no free night at all. Four Seasons, Aman, Rosewood and The Peninsula publish no policy, because they have no points to pay you in.
What you are actually owed
Less than most people assume. There are no regulations in the United States governing oversold hotels in the way there are for denied boarding on a flight. A guest who prepaid is entitled to their money back. Beyond that, anything you receive is policy or goodwill rather than entitlement, which is precisely why the policy you booked under matters so much.
The published guarantees, and their fine print
Marriott publishes the most detailed policy of the large groups. Under its Ultimate Reservation Guarantee, a walk at The Ritz-Carlton, Ritz-Carlton Reserve or St. Regis pays US$200 plus 140,000 points, but only to Titanium and Ambassador Elite members. At the premium brands, meaning EDITION, The Luxury Collection, W, JW Marriott, Westin and the rest, it is US$200 plus 90,000 points for all elite members. And the whole thing hangs on one condition buried in the terms: you must have provided your member number when you made the reservation.
The others differ more than you would expect. Hyatt provides a free night at a comparable hotel, transport to and from it, and a phone call. IHG covers the full cost of the first night's lodging plus tax, and transport. Accor offers no complimentary night at all, only comparable accommodation and the reasonable expenses of getting there. Hilton's compensation depends on the property filing a form afterwards, which is paperwork the guest cannot see and cannot chase.
It is also worth knowing that these guarantees are not self-executing. Cases are documented of properties finding their way around Marriott's guarantee and paying an elite guest nothing at all.
The hotels with no policy whatsoever
Here is the part nobody writes about. Four Seasons, Aman, Rosewood, Oetker Collection and The Peninsula publish no walk guarantee, because they run no points programs and have no currency to pay you in. There is no table to point at and no tier that entitles you to anything.
That sounds worse and usually is not. A genuinely good independent hotel treats a walk as a service failure rather than a transaction: the alternative is a comparable or better property, the transfer is arranged both ways, the first night is absorbed, and there is normally something meaningful waiting when you return the following day. But none of that is written down anywhere, which means the outcome depends entirely on who is asking and on whose behalf.
Why a flagged booking is less likely to be the one that goes
When a hotel is oversold, someone decides which reservation is moved. It is not random. The reservation that goes is typically the shortest stay, the lowest-yielding rate, the guest with no history at the property and no note on the booking, and very often the latest arrival. A one-night stay on a discounted rate arriving at 11pm is the obvious candidate.
A reservation flagged to the hotel through a preferred-partner program days in advance sits at the other end of that list, and not because of sentiment. It is a booking the hotel has already committed amenities to, attached to a relationship it would rather not damage, from a channel it has chosen to invest in. That is the whole mechanism, and it is worth more than any published guarantee we could quote you.
If it happens to you anyway
Ask three questions at the desk, in this order. Where am I being sent, and is it comparable or better? Who is paying for the room and the transfers, both directions? And can I return here tomorrow, in the room I booked?
Get the answers before you leave the lobby, because leverage collapses the moment you are standing in another hotel's reception. Then call us. An advisor can escalate above the person in front of you, which is usually the difference between a refund and a resolution.
Our position
Do not choose a hotel on the strength of its walk policy, because the best outcomes come from never being the reservation that gets picked. Book a rate the hotel values, give a realistic arrival time rather than an optimistic one, and make sure the property knows you are coming before the day you arrive. Those three things move you down the list far more reliably than any compensation table moves you up it.