It is because hotels are reuired to report who is living there and some hotels cannot do that for foreigners. Likely due to limited training among the employees. If possible, ask someone with a Chinese ID to book for you. 7DaysInn, if you book online, you will also get some discount or save up for free days. As far as I remember, less than 7 days stay triggers a free day. 

Hotels need a special license to host foreigners. The idea is to ensure a minimum standard for foreigners. Why there a different of standards for foreigners and Mainlanders

* The cute answer : Because we Chinese care so much of our hosts, we want them to feel the most comfortably we can possibly do.

* The cynical answer :  We know many of our hotel are trash dumps by international standard, we feel ashamed of it. Our own population, well, they don't know any better so why bother ! Rather than solving the problem, we patch over the problem. And yay, a license to sell, it's more opportunities for money in my pocket ! Okay, and an old legacy from pre-1980 times.

I am a foreigner and I have stayed in 7days inn in many cities (including Beijing!) and hanting inn. So I don't know why you are having this problem. I have not stayed in home inn before though. I even have a 7days inn membership card that gets me a discounted price. Every time though I just went in person instead of booking online. Maybe their system just can't process online booking for foreigners?

However, I have come across some hotels that don't accept foreigners (8days inn being one of them), where I also went in person. My explanation is as good as DrMonkey's. 

They have to report it to the PSB when you stay there. This is a hassle for them apparently. 

In addition,  there are limitations to where a foreigner can stay. They don't wont to give you a bad image of China, and so I assume some crappy hotels are simply not allowed to let foreigners in to see what a dive they are.

And because the Big Hotel names need the money from us and the Gov helps to force us to go there.

Because China wants to look good in the eyes of foreign guests, thus only hotels with a minimum standard are authorized by the government to host foreigners. Officially this is for your safety.

For the same reasons foreigners can't live in super cheap houses (trust me I tried, love those old houses with courtyard in downtown Foshan, pre-communist era, strong stuff, good quality despite being old) but only in gated communities, the police station will refuse to register your address and it might be considered as a breach of law. It might be different from city to city, for e.g. it's okay for foreigners to live in Beijing's hutongs because they have been restored, I used to live in there when I was in Beijing, one with central heating and other modern comfort, loved it.

The chain hotels u mention, 7 days, hanting, home inn should never present a problem.  For those for "Chinese only", just have a friend book for u first time.  If u don't cause problems, it is easy to book future visits as long as hotel knows u.  They gladly accept foreigners money, and the fact that we don't stuff 4 people in a single room and trash it.

I have never experienced this problem before but I don't usually choose to stay in 1 or 2 star hotels.

Ergo, based upon my own experience, my conclusion is: it is just you Mr 603921935. The best solution is to swear loudly at the hotel staff each time you experience this personal snubbing.

I wasn't sure if your questions were rhetorical or not....if not, you're welcome

The last time I was told foreigners couldn't stay here, it was in a hotel I had been to 3 or 4 times before with friends and there was never a  problem before, the previous times they always registered us and gave us rooms like it was nothing unusual, and it probably wasn't.

This last time though they said foreigners couldn't stay there. When I said I had stayed there several times before they called a supervisor who said oh, ok and then registered me as usual and gave me a room like every other time.

It made me wonder if it was some new semi- official 'thing', or if it was just lazy and / or untrained staff not knowing what to do.

Can't answer your question, however there are plenty of crap 4-5* hotels. We booked what we believed was a 4* hotel in Shenzhen last month, well maybe 30 years past, it was a dump but 5* prices. Leaving there the wife a I headed up to Guangzhou to finalize some business, again a supposedly 5* beside the Pearl River. Beautiful hotel, however the service was terrible. Booked a hotel in Dalian sometime back, arrived at 10:30 pm and was knackered, I walked into the room, done a 180 and left, it was filthy dirty. Shanghai 3 months past, my wife booked a hotel, taxi from airport to hotel upon arrival the receptionist ask for 100 yuan more, stating your husband is a foreigner, we charge more for foreigners. 5* Means what in China! many of these places are filthy dirty, absolute disgusting places. I really dislike staying in hotels here. My wife is off back to Shenzhen and Guangzhou next week, I have just refused to go. This place really can be the pits sometimes.

I'd say I have a similar experience with others here, that I"ve never had any problem with hotels so long as I was with a Chinese person. Won't say anything else.... because we all know that if you have something good that's working for you, it's best not to say it in places like this.

Hotels in China must have Gov. permission to accept laowai.

I had similar problem in Beijing in hotels around W. Railway Station few months ago.

I got overnight room in the smaller, private hotel after 2 hours of begging.

Because every foreigner is a potential criminal or CIA agent looking to destabilize the harmonious China.

This would therefore be a grave mistake to allow them to come and go undocumented as they please without the local government knowing within 5 minutes.

The cutting edge technology allowing to scan and transfer a copy of a passport must be purchased from Fukaiyou Disassembling and Reassembling of Stuff From A Decade Ago for Various Purposes Co., Ltd., whose boss is a good friend of Mr Wang, head of the Foreigner Registration Certification Bureau. And it is all very costly.

I know it might be frustrating, but honestly just like with the housing pretty much any place you'd really want to be it's not going to be a problem.

Remember that all foreigners aren't educated westerners, by having blanket restrictions on where foreigners live they keep mongols and other undesirables from piling into village houses.

It's just a way to create a price floor and defacto segregate out po' foreigners. I kinda figured the govt feels it has enough uneducated bumpkins. If they're going to let a foreigner in it's going to be because they can contribute something. Which...frankly I don't have a problem with. I just wish there was some reciprocity on the west's side.

 I have been in China a while, and hadn't experience this problem for many years until again recently! Several years back I (attempted) visited an overrated INTERNATIONAL TOURIST CITY, as the billboards blatantly advertised. Upon arrival I tried to check into an average yet convenient hotel along a main street. They had signs posted saying whether or not foreigners can room there. Identical establishments had different policies...

Then also visiting a smaller, quaint city following some college students on break, there were rows of nice, cozy hotels and inns nestled below the beautiful natural scenery of the town - I checked in promptly after surveying the quality and conditions of one inn. I unpacked and just started to shower when a knock came at my door and one of the clerks apologized saying the boss told them that as a foreigner I needed to check into a different hostel for foreigners - they indicated it was FOR THE SAFETY OF THE FOREIGNER. Interestingly and ironically enough, it was located down the road and up a hill in a creep, dark, desolate corner on the edge to the township - hard to find and definitely not a safe feeling to get there. I protested that this act was not very welcoming, and that the Chinese government had previously declared a comprehensive listing of all the places (cities) foreigners should be able and allowed to visit - it would have been a lot simpler to just post which places (cities) that were off-limits to foreign visitors! I ended up paying  the owner of another inn just slightly more than average to stay at his hotel in a moderate - not the best location - to enjoy that vacation spot.

Thereafter I had not had a problem checking into any hotels in other travels by myself, with my g.f. and then my Chinese wife. In fact, we used to carry our marriage certificate to be prepared if any questions came up, yet found that most places told us not to bother - they just needed to see regular ID (and in my case, my valid passport and visa) copies to register into the hotel. Yes, registering into any hotel qualifies one to be registered with the PSB. Supposedly if you happen to stay with friends or even relatives, you are expected to report your stay to the local public safety bureau within 24 hours to make it legal!

Well, recently I relocated again. I came to a notably rather large and popular city, expecting a modern, contemporary life with my new job. As it turned out, because of a hurricane my flight was terribly late and I arrived (with no pick up) when everything was closed. I took an airport shuttle bus to seemingly nowhere, then tried to get a cab to take me at least close to my final destination. We tried several hotels along the way - I was shocked to learn the policies seemed to turn back the clocks! I felt regret coming to a city that viewed foreigners as something from MARS! And, after all these years - where is the progress? We tried a couple of chain hotels, like 7 Days Inn, which were either full or wouldn't/couldn't take foreign guests. I had no luck and was almost prepared to either roam or sleep in the streets until dawn, when the cabby, out of sympathy turned off the meter and made some more calls. I speak and understand Chinese pretty well, so I could tell he was sincere, and I promised myself I would allow myself to pay over a certain limit. He'd asked if the places firstly had rooms or not, then the price, and lastly politely and RESPECTFULLY added that he had a "foreign friend" (not laowai) in his cab needed to rest for the night. At last one, a business hotel complied, but when I checked in, they never indicated me by name or even use my passport. They just wrote the room number and the numbers of days and the price, plus deposit I got back when checking out without a problem after my couple of days stay! I even managed to haggle the price down since I arrived at about 4 a.m. - It was a fairly clean and decent, quiet, peaceful place (on a business block which I found had shops, restaurants and nice businesses and nothing naughty), whether they were legitimate or not.

Retardation and spasticity.

No offense.

I remember I time I visited Nanjing and forgot my passport at home.  This was before there was a rule that required ID to book a train.  When it came time to find a hotel, a nice cabbie found me a place where I could stay for the night.  It wasn't a hotel.  It seemed to be a high end massage parlor with girls on the second floor.  I stayed the night in the TV room with many comfortable fold flat chairs (like in the first class section of the plane).  It seems they make a tidy business because many others spent the night there.  And no, I didn't take advantage of the extra service upstairs.