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I’m looking for a bit of advice re. pricing. We have a small studio for 2 guests and so far have been busy and had great reviews. Now we’re getting to the quieter season I’m exploring ways to tweak our pricing.
Currently we don’t charge a cleaning fee but I’m wondering if it might be better to reduce the price - say by £20 a night but, add on a £20 cleaning fee. Do you think this will work out better for us meaning people might stay for two nights with the one cleaning fee at the end? Also does charging a lower price for the stay alone reduce the service fee?
Most of our guests stay overnight with a few staying 2 days (3 at the most). It’s a small space!!
I personally would have a cleaning fee year round and reduce the nightly fee off season while still keeping the cleaning fee. Look at other listings in your area to get a general idea of what is an acceptable cleaning fee.
If you have distinct seasons, then you really should have a High Season price and a Low Season price. Here in SW Florida (Fort Myers) our Poolside Cabana (sleeps 2 only) goes for $99 in High season, and $65 per night in Low season. We charge a $20 cleaning fee year around. Silly not to charge a cleaning fee – it helps pay for your expendables – soap, TP, paper towels, tissues, etc.
I think best thing to do is check your competition. There’s no hard and fast formula unfortunately, I had a tricky job working out best price… I should charge more because I have a garage, but less because no garden, but I DO have a roof terrace, and I’m very central, but there’s no kitchen, but I can get them discount at the restaurant over the road…
And on paper, when you work out a price, the place that’s 12% worse than you just happens to have photos that appeal to more people for some reason, now that ain’t fair. Someone else may have a different cleaning fee, which might catch different people’s eyes,
If you worked out what you would should earn, but it’s 25% more than everyone else, you’ve screwed up. A host who has a massive mortgage should not charge more than someone with no mortgage, on an identical listing. Equally: if one has no mortgage, for goodness sake charge a competitive rate!
I regularly look at all the listings in my area on Airb, but also take into account that I am full most weekends, so I’m doing something right. Am I too cheap, is the next question!
If I have no bookings in low season, how low should I go: Answer - check competition.
The cleaning fee is meant to allow you to pass on the one-time costs of a reservation to the guest. It has a side effect of encouraging longer stays since it is a fee the applies per reservation and not per night. I disagree with @KenH about it covering the cost of expendables. Expendables (consumables) such as toilet paper, soap, coffee, utilities, etc. should be covered in your nightly rate. The cleaning fee should be representative of what it would cost you to hire somebody to clean your listing, plus any other one-time-per-reservation costs, such as a gift basket you leave for your guests at check-in.
Charging a lower nightly rate definitely lowers the service fee that Airbnb charges. Airbnb chargest the guest a minimum of 12% on top of your nightly rate, plus the 3% they take from the host, so they get at least 15% of your nightly rate.
@Barns is right that you need to research your competition and I’d recommend doing it at least weekly. The part about the mortgage is tricky, if you don’t have a mortgage, then your costs are lower, and you can offer a lower nightly rate, but you are leaving money on the table if your rate is too low.
One thing you might want to try during your off-season is a lower nightly rate with a longer minimum stay. The purpose is to try to make the same money with less work/overhead for you, and researching the competition is, again, critical.
Yes, we’ve checked out local competition and we fare quite well there. We also have a high / low season rate.
What I was thinking was along the lines of Brian R170 that if I charge less per night the Airbnb service fee will be lower BUT we could get more two or three night stays as the cost per night would be lower.
We simply can’t do 2 night minimum stays as the property isn’t huge and suits short stays better - most of our bookings are one night and we’re OK with that. But what we often offer is a second night stay at a cheaper price. We prefer 2 night stays though as there’s not much extra required and we make a bit more - minus the change over hassle.
Hmm. I don’t quite get the logic. If you charge less per night, you’ll get as many one-night stays as you get now. Maybe more. You might get a few more two-night stays, but I wouldn’t count on it.
We have never been low-priced. We’re always well above the center for Airbnb in our area. But we still get a fair number of one-night stays.
Stays are stays. Keeping the place clean and the bedrooms/bathrooms changed doesn’t hurt us. We’re fine with multiple one-night stays in a row. Another host here on the forum talks about “heads in beds.” That’s how we feel, too.
Our goal is to compete only one time. Once we get guests to stay with us, they never go to our competition the next time around—unless we’re booked. They come back to us. We’ve had dozens of people here two, three, ten, even twenty or more times.
I don’t believe that Airbnb customers are entirely driven by price. At least not the customers we want. And no one has ever asked us for a discount.
The people who stay with us come here for comfort, safety, hospitality, attractive surroundings, amenities, delicious breakfasts—and to meet our greyhounds.
Just a little message to say that after the post I put up / the replies and help I got and the tweaks I then made we’ve now got our first ever 4 night stay!!! (BTW it’s out of season here in Scotland).
We decreased the nightly fee and added a £15 cleaning fee. So delighted as we didn’t expect anything like this at this time of year.
Basically we have people staying for longer (who tend to be out touring most of the day) / get more money overall and don’t have to do the constant cleans - happy days. We’re very much still learning so it’s great to have a forum like this for support.