I’m curious how good (or bad) Airbnb’s Smart Pricing is. Specifically, how well it works when big events are in town that cause a very short-term surge in demand. My suspicion is that it waits until the supply is low a few weeks in advance instead of doing a good job of predicting the actual demand based on specific local events (vs. just general “high season”) that are scheduled more than 6 months in advance and guaranteed to cause a peak in demand.
For example, the Superbowl will be hosted locally in 2023. I know people that were over 40 miles away and rented their modest homes for $5K/week the last time the Superbowl was local. Will Airbnb’s pricing algorithm automatically go to the high end of the host pricing for nearby dates or, if guests book early enough, will it let them book closer to the host’s minimum pricing?
I recently read a bad-host story from a guest that said they instant-booked an Airbnb listing several months in advance to attend a sporting event. The guest was a regular at the event and knew the listing was conveniently located and the price was really low. About 1 month before the event, the host made a change to the reservation by almost tripling the price and saying the guest could cancel if they didn’t want to pay it. It was clearly market price and the guest knew it. The guest didn’t pay and didn’t cancel, so the host cancelled, knowing full well they could easily rent it outside of Airbnb’s platform and easily recoup Airbnb’s penalty. It’s was a terrible thing for the host to do, but I’m wondering if Smart Pricing failed the host in that specific situation.