Free money for hosts on 15% commission rate with Airbnb

1

No such thing as a free (money) lunch, is there?

Well, dependent upon your location, there may be money from Airbnb sitting there on the table, just waiting for you to grab it!

If you’re a “connected” host forced onto the 15% commission rate, or have simply chosen to go for the host pays all model, here is an interesting opportunity.

Pay an additional 5% and Airbnb will:

Market your property on Airbnb
Adjust prices to ensure maximum returns (:rofl:)
Take over all guest communication
Arrange cleaning
Provide bed linen, towels AND coffee
Meet and greet guests
Deal with mid stay issues
Do post check out inspections

I’ve no idea what value folks put on their time, but for an extra 5% of the gross this to me is a bargain. No laundry to deal with, in fact no sheets or towels to even buy (or replace), no hanging around for guests to arrive, or leave! They even provide the coffee :coffee:

Ok, the number of locations is pretty small just now, but it does look like they are increasing. Just now they are in France, Canada and Spain.

I’ve no idea if they require exclusivity, but suspect they might.

All you have to do is sign on the dotted, again.

https://luckey.es/en/

Feel free to tear it to bits, or not.

JF

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I can see this working for some hosts or as a temporary measure for others during the COVID situation. . We have an in home situation and love meeting our guests so this won’t be an option for us.

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I would not trust them to do a good job nor to maintain high standards of quality and cleanliness. And I would expect them to underprice the property. They likely would “own” the listing ( not the property) and they own the reviews too. The will probably operate like turnkey or evolve- and they both do a lousy job overall.

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No they don’t, it states that the account is yours, albeit with access only via the Luckey site or app.

JF

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omg it would be like not having a choice and automatically accepting “price tips” . This would cost me big time, price tips for my listings are less than half of the pricing I actually get.

The race to the bottom, with Air at the wheel

No thanks

RR

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I would not expect that you can get it back so they do own the listing.
Here is what they say:
Can I still use my Airbnb account?
Answer:
“Unfortunately, a user can only have one single account on Airbnb and we’ll have to create an account at your name to manage your property on the platform, so you won’t be able to keep using your existing account as a guest.
We are working closely with Airbnb to find a solution to this issue.”
So…if you terminate them, they dont give you back that listing they created with all the history and the reviews. They turn off the listing they created, and you start all over and create your own listing and login account again. That is how and why they own the listing. They created a new listing on their platfrom in your name. They own that listing they created.

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Can I access my Airbnb account to view my reservations?

As long as we’re managing your rental property, we’ll be the only ones with access to your Airbnb account. But you can easily track your reservations, under the Bookings tab in your Luckey app.

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They also take the photos. So I expect they would never give the owner rights to the photos they have had done for the listing they create.

Who takes the photos for my property listings?

We use professional photographers to ensure the photos are the highest possible quality. This makes for a more attractive listing and a higher occupancy rate .

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Maybe if you had a bunch of moderate rental units this could be attractive. It would be better if you could sign up for a trial period.

I don’t see how this business model can make money for a 5% added fee, although the cleaning fee is separate. One can only imagine the quality of the 24/7 guest support. This is maybe a teaser rate to generate sign ups?

It says that it is easy for Luckey to manage reservations, then in the next sentence that “we allow you to easily follow and manage your bookings” with a phone app. Unclear who does what, eh?

Also as noted it doesn’t seem ready for prime time as it cancels your Airbnb guest account. It keeps all your host eggs in the Airbnb basket, frequently advised against here on the forum.

I’d fear that under financial pressure they’ll hire the cheapest contractors for cleaning, etc., then pursue volume with rock bottom pricing, Are those 5 star ratings they’re flogging guaranteed haha? I see they choose the cancellation policy.

I think the deal killer is that they disavow any responsibility for the outcome of damage claims. It is unclear to me how they would step aside as a third party so that the owner can deal with Airbnb on damage. How would the owner be notified of damage? Would notification be timely enough to document and make a claim?

The site claims that '[Airbnb] gathers the evidence that could be useful as quickly as possible: photos, bills, police reports and other documents attesting to the property, damages incurred and the fair market value of the damaged goods. As soon as Airbnb has gathered sufficient information from the two parties, it reviews all documents and assesses the compensation claims."

We know that’s not true. Airbnb compares evidence the owner gathers to guest’s word in a murky and inconsistent process. All Luckey says is that cleaners will notify them of “anomalies,” and “We do our utmost to gather evidence within the very short timelines provided,” which reads like a built-in excuse for a sorry, shrug response.

There’s a required down payment noted, presumably in the event of cancellation but unrelated to damage compensation.

Sufficient tearing to bits?

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I imagine it would go like this:

“Our professional cleaning service reports that it appears your guests built a fire in the middle of the living room and roasted marshmallows. See attached [blurry] photo. The Airbnb Resolution number is xxx. We have cancelled your upcoming reservations. Please advise when repairs are completed so that we can re-open your listing. Thank you for being part of the Luckey family of Airbnb property owners! We look forward to continuing to work with you!”

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Sounds like a big scam to me.

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Seems like this is a recent acquisition for Airbnb.

Honestly, if you had a small number of listings that you were managing yourself, in an area where STRs have a high rate of return, this seems like a really good deal. In the U.S., the 5% fee would be less than the tax advantage for many hosts, since it would move the income from active (Schedule C) to passive (Schedule E).

Unfortunately, like all things Airbnb does, I would expect their terms to change substantially after they start analyzing all of the data they’ll collect about it. I can imagine they might raise the rates to where it’s no longer a cost advantage, but they could also discontinue it altogether and force participating hosts to start over.

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So what happens when a guest makes a complaint about a nonexistent camera?
Would you have a case against the guest because of the Airbnb management? Would they support their management company?

Personally there is no way this would happen with my listings… it feels like a one size fits all push to hotels style accommodation

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It sure sounds like a disaster waiting to happen for anyone that signs up!

For hosts like us who are truly quality conscious, I hope that most Air guests would soon figure out which are managed by them, and opt for the stays with a personal touch instead of corporately run investment properties.

There is NO way they can maintain quality with this regime. Another company put together by bean counters, not anyone who ever ran a STR.

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I looked up more about Luckey ( just for fun because these easy money hooks drive me nuts). There is a big lack of quality control over the staffing of these areas; you are correct. I looked at the Luckey website regarding the “job” of a city manager. Anyone who signs on as a Luckey city manager person to grow and develop a territory, is someone who may or may not know anything about STR or property mgt. It doesnt even need to be their full time job. They only need to have an entrepreneurial spirit and a sense of service. Luckey will get them started on their new venture. This person will be in control of all the operational tasks on the field. They will be growing their own property mgt business. Link: https://www.airbnb.com/d/city-managers.
MORE INFO ABOUT THE TRAINING AND SKILLS OF THE PEOPLE WHO DO THE MANAGING ( paraphrased) :
Luckey has an optional Starter Pack offer designed to guide new area city mgrs through the first 6 months as a city manager to grow business faster.
The Starter Pack provides helpful information about finance, hiring, training, administrative assistance, marketing, and more. It’s filled with expert advice that will help make the most out of the Luckey experience.
It is a plus to have professional hospitality and/or concierge experience, but it is not essential. The most important thing is to have an entrepreneurial spirit and be capable of dealing with challenges.

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That was my first thought also. I can see a logic, for certain types of hosts, to simply hand the property over to a third party agency and just let them get on with it. However, with Airbnb getting more than one slice of the pie I don’t see much of an incentive for them to ensure that any pricing policy is correctly balanced between occupancy and revenue.

They’ve been quietly trying to expand this in Spain, closest advertised “coming soon” is about 50mins up the road in Sevilla, so they must be making money from it, you’d think. They appear to be targeting around ten of the main tourist destinations, but hopefully they’ll ignore our sleepy little city for the time being as I suspect they’d drive prices down if they had a significant presence.

This year, they are looking at:

The locations where Luckey plans to launch and expand this year are the following: (1) Costa del Sol/ Marbella, Estepona & Mijas, (2) Alicante, (3) Balearic Islands: Ibiza and Mallorca, (4) Tenerife, (5) Gran Canaria

We’ve just got rid of one major slumlord (40+ listings), and don’t want another popping up in their place.

Yes, it looks like they demand exclusivity. I was curious enough to do a search for Luckey Homes and there were several cached entries for BDC properties managed by them, but they are no longer available.

Concise and to the point as usual m’dear :wink:

I didn’t want to be overly negative when I came across this little side venture of Airbnb (:wink: @KKC), but it’s difficult to come up with many plus points for anyone who cares about their rentals and goes about business in a professional manner.

One thing I left out, and I’m surprised that anyone who looked at their site didn’t pick up on it, is that this is a franchise operation.

If you want to be a “City Manager”, and click the link, after filling in your personal info, the question is asked:

“Available capital” and it’s not an optional field :rofl:

Maybe I’ll give it a try for Sevilla :wink: and see what happens when I say around €124.88 as my “available capital”!

JF

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What a bunch of slackers we are! We on the forum have had the whole pandemic downtime to 1) unionize/organize ourselves; 2) develop a property management service; 3) gin up cleaning and supply companies.

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Where do you see that it’s only an additional 5%? I would imagine it’s more like Airbnb takes 15% commission off the top, then Luckey gives you 80% of what’s leftover. $100 * 0.85 * 0.8 = $0.68 of every dollar paid to you.

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And folks say guests don’t read…

JF

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They never mention Airbnb’s service fees at all, which makes it unclear, but I believe you are correct, plus I have a really hard time believing there would be such a difference in fees between the host-only fee model and the split host/guest fee model. I actually suspect it’s worse than your 68% estimate and it would be more like 65% of the nightly rate (i.e. 15% of the full nightly rate to Airbnb and 20% of the full nightly rate to Luckey), plus Luckey keeps the cleaning fee. That would be in-line with the most expensive full-service property management commissions.

This item in the FAQ kind of sums it up.

The bold was added by Luckey, not me. They’re looking for owner’s that aren’t doing well on their own, not owners that are looking for a bargain on property management commission.