Honoring a guest is according to what custom dictates, and this varies according to both the guest and the host. As for the host, this is due to Allah’s saying:
“Let a man of wealth spend from his wealth, and whoever’s provision is restricted, let him spend from what Allah has given him.” [al-Talaq 65:7]
Thus, if someone stays as a guest with a wealthy man, he should honor him according to the abundance Allah has granted him; but if he stays with a poor man, he should honor him according to his means. A guest may stay with a wealthy person, whose hospitality consists of slaughtering an animal for him and inviting those around him; while he may stay with another, whose hospitality consists of offering him a dish of dates, because the former has wealth whereas the latter is poor.
The same applies with regard to the guest, for guests are not all alike. A guest who is a friend, with whom there is no formality between you, may stay with you, and you honor him in a manner befitting him. Then a guest of high standing among people may stay with you, whether by virtue of his wealth, his knowledge, or his authority, and you honor him in a manner befitting him. Or a person from the ordinary public may stay with you, and you likewise honor him in a manner befitting him.
Part of honoring the guest, too, is not to calculate the cost of his hospitality for him, as Abraham, peace be upon him, did. When the angels came to Abraham, peace be upon him, he went quietly and swiftly to his household. The scholars said: he set off quickly and discreetly so that they would not say anything, since it is customary for a guest, when the host wishes to honor him, to begin swearing: “By Allah, do not do such-and-such; do not do such-and-such.” So Abraham went swiftly and discreetly, and brought a fat roasted calf.
Some people offer hospitality, but when they serve the meal, they say: “Please, help yourselves. By Allah, we could not find this meat today for less than ten per kilogram,” or, “Meat is expensive today—but you are worthy of it!” This involves reminding the guest of one’s favor.