Booking.com host asking me to cancel reservation - is this a common tactic?

I'm looking for some advice from people who have experience with Booking.com.

I booked accommodation for July and have since booked the rest of our holiday around that stay, including other accommodation and travel arrangements.

The host has now contacted me and sent an offer asking me to cancel the reservation. They haven't explicitly cancelled it themselves yet. They have just stated there "Seems to be a glitch between two bookings"

My concern is that prices for accommodation in the area appear to have increased since I booked, and I'm wondering if some hosts do this to avoid penalties and relist the property at a higher rate.

A few questions:

• Is there any reason I should cancel the booking myself rather than making the host cancel if they can no longer honour it?
• Does Booking.com offer any protection or assistance in helping find another accommodation if a host wants to back out of a reservation?

I'm just wondering what's the best way to handle this situation is, at the moment I'm inclined not to cancel and instead ask the host to cancel from their side if they genuinely can't accommodate us.

Any advice would be appreciated.

Author: gearvrabc