Since I will be a Host soon I wanted to know how to calculate the second person?
I have a basement with its own entrance that I will advertise for a maximum of 2 people, night will be priced at $75. How can I do it for the second person?
Thank you
unless you are going after ultra budget travelers, I would not charge more for 2 people. It is not market.
What Brandt said – one or two people is $75 per night
I think the OP is asking what he should charge for the second person, not that he wants to charge for more than 2 people,
@mikelowrey - look at what people are doing locally with comparable properties - what are they charging.
You can either do what others here have suggested and charge the same whether it’s one or two people. Or charge a price for one and a small extra charge for two.
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First of all calculate the extra cost for a second person (towels, water, electricity, breakfast,…). After that decide how much you want to punish people for traveling alone, and how much you want to reward people traveling together. It’s a difficult one to balance…
IMO It isn’t fair that one person has to pay the same amount as two people. But since my costs doesn’t double when having two guests, I don’t think it’s fair to make two people pay double. I guess my ideal would be that one guests would pay 75% of two guests. But truth be told, at the low end of the market where we are at, this is difficult to put in practice. Or it becomes too cheap for one guest or too expensive for two. Until this moment I just charge US$ 7,00 extra for the second guest.
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We often get solo travelers so we charge $20 extra for the second guest so that the solos get a break.
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I understand he question. Unless your completion is a hostel, I wouldn’t charge differently for 1 or 2 people. Equivalent of a restaurant charging for tap water. Comes across poorly IMO.
You always may be leaving money on the table with 1 person rates.
I’m in principle opposed to both having no extra charge for the second person and to charging double.
Like @GutHend rightly points out, charging no more for the second person in effect means single people are subsidizing couples’ travel. This to me feels unfair.
And it’s wrong to simply double the price, as the host’s additional costs are much lower than a 100% increase.
So what’s left is somewhere between a 0% and a 100% extra.
Apart from the practicalities - such as the extra costs already mentioned by GutHend etc, there’s the question of using price as an incentive.
I’ve tried both - keeping the 2nd person charge as low as feasible and jacking it up a bit.
#1
When I kept the 2nd person extra quite low - 10-15%, about 40-45% of my bookings were doubles.
#2
I later changed this, I made the extra to be 30-40% of the base/single-person price – partly because I realized that in addition to material costs, there’s additional strain in handling the expectations of two different people, different chemistries etc.
With the higher extra, my doubles bookings are about 25-35% in a month.
This has suggested that I still get on average the same earning from the 2nd person on a monthly basis, or perhaps even slightly more, but less of the strain of handling 2 people compared to singles.
(I’d like to hear from other hosts who’ve probably tried something like this out and crunched the numbers.)
To sum up therefore, even though it depends on your circumstances, I’m currently in a position to recommend you charge a 30-45% extra for the second person on top of your base/single-person price.
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I don’t have the time or interest in calculating. I simply looked at what my competion in similar listings charged and went from there. I have a small room with ensuite bathroom. In weather warm enough for them to use the window AC the rate is $42 a night with $8 second person charge. Two people use more utilities. Like Guthend I don’t think people traveling alone should be penalized. Most hotels charge additional for more people so it’s a model that people are used to. If I had a larger, more expensive place I might have one flat rate.
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Really interesting @Astaire
I would still recommend the OP looks at what others do in their local area.
I charge 10% extra for the second person, because this is what others in my area do and if I didn’t I wouldn’t remain competitive in a very overcrowded market place.
There is one listing that charges 50% and I have noticed have had very few booking this year.
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I’m certainly not advocating ignoring the competition - we are talking about being competitive after all.
But I’ll reiterate that there are two customer bases here - singles and doubles. Charging a different (higher) price for doubles must not impact the listing’s attractiveness to singles.
So I’m not sure charging 50% extra for the second guest is the main reason for the very few bookings in the cited case.
If you charged more than 10% does it mean you become uncompetitive to singles as well? In the end, it comes down to striking a balance, for which of course there’s no easy answer. Going by what others do is one thing, I’m trying to use real data/figures on top of that to come to a better position.
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So all the extra costs of the second person staying are equivalent to the water that flows out of your tap?
What does 'It is not market" mean?? Can you explain how you derived at your conclusion of essentially allowing a second person staying for free?
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It is standard practice in lodging industry to charge the same for 1 or 2 people. You are more likely to lose money on a 1 person stay if you have a lower rate.
I can’t agree. Here a second person gets a bottle of water, a small chocolate, a coffee cup, tea, instant coffee and cream. Two people in the room increases the temperature and likelihood of using the AC. If they are a couple they are more likely to leave stained sheets, and messes in general. Twice as much water, toilet paper and toiletries used. Twice as much noise as they talk to each other and go in and out the door banging around. In the 3+ years I’ve been doing this I find that I prefer single travelers.
It’s just as likely to come across poorly for one to pay the same as two. I’ve hosted over 250 people using this model and I have no reason to think it’s negatively impacting my booking rate. I have about 60% singles, 40% couples.
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It depends on the market. Since K9 gets a lot of road trippers, it makes sense she would have the majority of single travelers.
In my case in Hawaii I get mostly couples and so I cater to couples. Many of them are coming on romantic trips, anniversaries or honeymoons. Some are friends traveling together or parents with an older child, but mostly they are married couples or dating couples.
While solo travelers are definitely my preference, I hardly ever get solos booking (although I have one coming this weekend for two weeks, yay!)
I can’t charge more for couples or I would get nearly no bookings.
No it isn’t. You get a cheaper rate for a single room.
Hi @Astaire
I’m not suggesting it’s the only reason. However at one of our local meet ups she mentioned that she had quite a few people say they were interested in staying but the rate for the second person was too high.
In my case my rate is competitive for both singles and doubles in terms of my local market for similar properties.
Our self-contained space is available to 1 person or 1 couple ONLY.
We charge $12 - $15 for the extra person depending on the nightly rate’s fluctuation during the season.
We have had inquiries requesting an explanation for the extra charge.
We respond:
We charge a fee for the second person because couples create more laundry,
require more housekeeping, use more resources, and more water (ours is metered).
Best wishes,
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Thank you all for the great replies. I’ve noticed that around the around it goes from $65 and up a night. My price I was thinking at $75/night with a $25/night for the second person (basically 100/night) for the couple.
Most of the prices around here are for 1 bedroom that they rent, meanwhile I am renting a whole basement with its own entrance that has:
- Assigned Driveway Parking
- August Lock that you can open with phone or with keypad at door.
- SUPER FAST Internet (500/500)
- AC/HEAT + Electric Chimney (really nice one that shows a visual fire)
- Microwave
- Small Frigde
- Coffee Maker
- TV with FireStick, Netflix, KODI, Sling
- Desk for business travelers
- $3500 Pillowtop Simmons Beauty Rest Mattress
- I have a deck outside that could be used by the renter when not in use by me.
And toiletries.
Does that price sounds fair for all that? Thank you.
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Sorry, that is not an amenity. Either it is available or it isn’t.