In 2019, Australian Frequent Flyer compared how the value of Qantas and Velocity points had changed over just four years. We found a clear trend showing that the points were worth less in 2019 than they had been in 2015.

It’s now been four years since we conducted that study. So, we thought it would be a good time to again track how the value of frequent flyer points has changed over the same period of time!

Both four and eight years ago, we calculated the precise value of one frequent flyer point in both the Qantas Frequent Flyer and Virgin Australia Velocity programs, depending on how that point was spent. This week, we ran exactly the same calculations. So, how has the value of points changed over that time?

Are points worth more or less now than in 2019?

The good news is that points haven’t decreased in value since 2019 in the same way that they had in the period between 2015-2019. Qantas Frequent Flyer has not increased the cost of Classic Flight Rewards or upgrades at all over the past four years. And Velocity has merely tweaked its domestic Economy reward seat pricing (resulting in some seats costing less than before).

If anything, you could actually say that many flight redemptions are now more valuable than in 2019 because the equivalent cash airfares are higher. This is especially the case for long-haul Business Class airfares.

However, this doesn’t account for reward seat availability. Anecdotally, it’s now harder to find award availability than it was last decade – particularly long-haul seats in premium cabins.

Meanwhile, both Qantas Frequent Flyer and Velocity have made a few changes to the value of non-flight redemptions over the past few years. For example, Velocity has reduced the value of hotel redemptions while Qantas points are now worth more when booking hotels. And you’ll now need more Qantas points than before to redeem for a supermarket gift card.

How much is a Qantas point worth in 2023 compared to previous years?

The value of one Qantas point depends on how you redeem it. In general, redemptions for Classic Flight Rewards or upgrades are worth more than non-flight rewards such as gift vouchers or sporting equipment.

So, how much is a Qantas point worth now – and how has this value changed over the past eight years?

Here’s our chart comparing point values in 2023 (in red), 2019 (in pink) and 2015 (in grey):

For the purposes of this chart, we’ve used the Melbourne-Sydney route as the benchmark for domestic reward flights and upgrades, and the Sydney-Los Angeles route for international flights.

As you can see, many Classic Reward and upgrade redemptions are now worth more than before. But this is generally a reflection of the higher airfares Qantas is charging in 2023 compared to pre-COVID.

Using points with Qantas Hotels or Qantas Holidays is also now significantly better value. It’s still generally better to use points in the air, but this change reflects Qantas’ decision last year to reduce the cost of hotel and holiday redemptions by 30-45%.

In 2020, Qantas also introduced Classic Rail Rewards. You can now use points to book iconic Australian train journeys like The Ghan and Indian Pacific, and the value is actually quite decent. Note that Classic Rail Rewards aren’t shown on the above chart because this redemption option didn’t exist in 2015 or 2019.

Unfortunately, Qantas recently increased the number of points you would need for a Points Plus Pay booking.

How much is a Velocity point worth in 2023 compared to previous years?

This chart tracks the changes to the value of one Velocity point, by redemption type, over the past eight years:

As you can see, some types of redemptions have become more valuable while others are now less valuable. There isn’t a clear trend. But, in general, the changes to the value of flight redemptions largely just reflect how much airfares have changed since 2019.

International long-haul flights are now relatively more expensive, so the value you get for the same number of points is higher. At the same time, Virgin Australia’s domestic Business Class fares are now lower than they were pre-COVID – so the relative value you get when redeeming the same number of points is lower.

Velocity Frequent Flyer changed its domestic Economy Reward Seat pricing earlier this year. There are now three reward seat tiers, with Tier 1 rewards costing less than before and Tier 3 costing a bit more. Overall, the value you can get per point on domestic Economy redemptions is now slightly higher because Tier 3 rewards are generally offered on flights with more expensive commercial airfares.

One noticeable change is that hotel and car hire redemptions will now get you only 0.6 cents worth of value per Velocity point. It used to be 0.7 cents per point, so that’s a devaluation.

Perhaps the biggest change though to Velocity Frequent Flyer since 2019 is in the different ways you can use your points.

You can no longer redeem Velocity points on petrol, nor for flights with Tigerair, Delta, Hainan Airlines, Hong Kong Airlines, Tianjin Airlines or Capital Airlines, or for Singapore Airlines First Class. Premium Economy upgrades are also now off the table, since Virgin Australia no longer operates any long-haul flights.

At the same time, Velocity has also added some useful new partners including Myer, Luxury Escapes, Qatar Airways, Air Canada and United.

Are Qantas or Velocity points worth more?

Using this data, we’re also able to directly compare the value of Qantas points and Velocity points for equivalent redemptions in 2023:

With Qantas, a point spent on a hotel booking is worth around 0.84 cents. Velocity points spent on hotels are worth closer to 0.6 cents per point. Qantas is clearly the winner here, but for other redemptions it isn’t so clear-cut.

Qantas points appear to be more valuable for domestic reward seats and upgrades. But this is mainly due to the fact Qantas flights are more expensive when buying a ticket. Qantas still charges slightly more points and has higher fees & charges overall on domestic reward flights.

On international flights, Velocity points appear to be slightly more valuable overall. But the chart doesn’t account for the fact that Virgin Australia serves fewer destinations and has a smaller network of international partner airlines than Qantas.

At the same time, Velocity and its partners tend to have a bit more reward seat availability to key international destinations like the USA, Asia and the Middle East, compared to Qantas Frequent Flyer. But Qantas has more options through to South America and New Zealand.

Points are subject to inflation over the long term

Just like money, frequent flyer points are subject to inflation as airlines increase the cost of redemptions over time.

Unlike money, you don’t earn interest on points that are sitting in your account (the airline does instead). Points can also expire if you don’t use them. That’s why I’m a firm believer that points are there to be spent on flights and experiences that you value!

Neither Qantas nor Velocity have drastically changed the cost of reward flights or upgrades over the past few years. But that’s not to say they won’t in the future. It’s inevitable that more devaluations will come at some point – we just don’t yet know when.

Back in the 1990s, for example, you could fly Qantas First Class round-trip from Sydney to Los Angeles for 200,000 Qantas points. There were no taxes back then, either. That would now cost 325,600 Qantas points and around $600 in taxes & charges.

So, it’s a good idea to use your points, whenever you can, on redemptions that are worthwhile to you! You never know what your points will be worth next month, year or decade…

Matt Graham

The editor of Australian Frequent Flyer, Matt's passion for travel has taken him to over 90 countries… with the help of frequent flyer points, of course!
Matt's favourite destinations (so far) are Germany, Brazil & Kazakhstan. His interests include aviation, economics & foreign languages, and he has a soft spot for good food and red wine.

You can connect with Matt by posting on the Australian Frequent Flyer community forum and tagging @AFF Editor.