Great deals on hotels and air travel are heating up—but only in certain places. Here's where to find the best travel values in years

If you think we've seen a buyers' market for travel lately, wait till summer. What with the economic crisis that has devastated business travel, airline overcapacity forcing carriers to cut fares, the low price of oil (which allows airlines to drop fares even more), the epidemic of empty hotel rooms (made worse by a glut of brand-new hotels), and the strength of the U.S. dollar, experts say that we're looking at a onetime confluence of events that will spell much greater bargains than we've seen in the past few summers. But travel won't be discounted to the same degree everywhere. There will be pockets of opportunity—certain destinations and methods of booking that will yield the greatest value for your dollar. Carpe diem.

Airfares to Europe
"Summer fares to Europe will be the cheapest in recent history," says Rick Seaney, CEO of the fare-monitoring site FareCompare.com. That's because last year, U.S. airlines moved many of their planes from domestic to transatlantic routes—right before Europeans stopped coming. "While there will be really good discounts in coach," adds Joe Brancatelli, publisher of JoeSentMe.com, the online bible for business travelers, "there will be even bigger bargains in business class: An advance-purchase business-class fare this summer will cost no more than a last-minute walk-up coach fare cost last year—say, $1,500 to $1,700 round-trip."

England, especially London
"There probably hasn't been a better time to travel to the United Kingdom since the summer of 1985," says Brancatelli. London is still an expensive destination, of course, but it's 35 percent cheaper than last year, thanks to the weak British pound; furthermore, "the hotels are empty and discounting heavily." Look for airfare-plus-hotel packages—such as British Airways' recent low fare that included two free nights in London—and check out VisitBritain.com's offers of free entry to many museums.

Las Vegas, New York, San Francisco, and other U.S. cities that normally draw convention-goers
"The convention business is a fraction of what it's been in the past," says Heather Leisman, senior director of merchandising for Orbitz. "Las Vegas and other cities that have lost business are putting rooms that were previously convention rooms back into the leisure market." In New York City, the big summer sales have already begun—such as consolidator Quikbook's promotion of 25 percent off its already substantially discounted rates at some of Manhattan's most popular small hotels. As for San Francisco, not only have room rates dropped but so have airfares on flights to and from the East Coast, thanks to Virgin America's entry into the market. I just paid $300, including taxes and fees, for a New York-San Francisco ticket over the Fourth of July that in past years has cost me $450.