I’ve loved being a host these past 3 years but as I sit with no upcoming bookings at all, and a very slim November I’m disheartened. My income this year is half of what it was last year.
I checked out the listings in my city and most are offering rooms at $35.00- there is ample supply and little demand. I have hosted people from all over the world and now I am getting “cheap hotel” types of guests- it’s completely different from when I started and I get it, the market changes. However… it takes me 1.5 hours to flip a room and clean the common areas in between guests- my time is not free and if I value it at $20 per hour I am losing money with utilities, wear and tear, the time it takes to replace damaged or broken items, touching up paint from suitcases against the walls, etc… My competition all priced themselves between $50 and $100 last year making my $65 rate competitive… now my colleagues have all reduced their prices, but we can’t compete against $35.00- most of us have reduced to $45 or $50 and I noticed today all of us that have been super hosts for years aren’t even on the first page.
Anyone else feeling this?
Also… as I changed my prices to $45.00 Airbnb recommended I change them to $40.
I know the feeling. One of the first posts I ever made on this forum was about how I wanted to give up. Only it was over reviews and not over pricing.
We all suffer seasonal lows. No one, absolutely no one, wants to come to Hawaii in the summer! 
So for years I just use that period to make repairs, clean the carpet and paint if the weather permits.
One thing I do NOT do is lower the price. I have a set point at which I believe ai am beginning to give away my time and compromise my principles, also known as selling your soul.
If you can afford to do so, just wait it out. Don’t lower your price. Keep in mind that those competition listings are probably new and they have not,learned how to value their time yet. They are just so startruck with dollar signs in their eyes. Those little grasshoppers will learn eventually.
I haven’t experienced this but I can empathize. I agree with Kona that you shouldn’t give up if you can afford to ride it out. It’s hard to believe people can afford to consistently provide 5 star experiences at $35 a night.
Before I did Airbnb I rented my spare rooms out to locals so that is my base price. I dont have all the expenses of a hotel so I dont use that price as a comparison. . Airbnb is currently beating the local rental market so I am happy.
I do monitor the costs and income very carefully to make sure that I am turning a profit. I have excel spreadsheets coming out of my ears!
I do not understand Smart Pricing. When I first started I thought that Airbnb must know what they are talking about because they get a commission so its in their bests interests to set a price that works but my experience did not bear that out so I ditched it over my pricing system
One of the biggest savings for me is on tax. I am buying my house and have a hefty mortgage. In Australia, when you declare your Airbnb income, you can attach all relevant costs so once I have included mortgage interest, council rates, water rates and every other other cost I am running negatively (akin to negative gearing on a rental property) so I get a hefty chunk of tax back from my part-time day job. The costs that I claim I would have to pay anyway regardless of Airbnb so its a huge win. So make sure you are calculating all costs and benefits.
I am an accountant in my day job so I like spinning the numbers.
My bookings are also down but I decided NOT to reduce my rates. I think everyone else in my area must be using “smart pricing” and running their rates lower and lower which is encouraged by Airbnb. I would rather have fewer bookings at a high rate than a lot of bookings, wear and tear, at a low rate. I am curious if the low rate hosts are going to keep it up once they realize how much work it is to clean and maintain a property.
I noticed this past year that the busier I am, the busier I am. When I blocked off a number of days (probably about 4 weeks in all) this past summer, my bookings were way down year over year and my place in search dropped as low as the bottom of the second page. It took about 6 weeks to get back to where I was before I blocked the days. So people with low prices end up with more business and that probably encourages them. I also wonder about the cleanliness level at some of the bargain places. Maybe people are willing to trade less clean and well maintained for low price.
I agree. We blocked off a lot of days in November as we installed air conditioning. Previously, we were always close to fully booked. Now, we’re only getting repeat business. Our listing is very low in the search.
I am very low in search, on page 17 but am getting inquiries for the rest of winter season. Pretty much sold out and traveling during March. There are simp,y not enough rooms on Hawaii Island to meet the demand.
This is an interesting point. Do you have your listing on other sites? Because if so you need to manually block out those dates so then this would be part of the impact?
Up until yesterday, we were only on Airbnb.
Definitely the market changed from 3 years ago when I started hosting. But that’s inevitable with almost anything.
We just have to adjust.
Summers for me is the slowest. And if I don’t have my 3 rooms occupied by longer term guests I am in constant search.
I just offer a room, nothing fancy at all. So I expect to be booked only based on one factor: price. I go by how I book Airbnb which is always a bigger hassle for me vs hotel.
I look at booking.com prices and go from there.
I am trying to stay in 1% category, otherwise I won’t be booked, I know that for sure. I spent enough time and effort to understand that.
I have my lowest limit. I won’t go below 42$. Otherwise I wil just read a book instead of hosting. In high season when mybprice goes to 90$ per room I get much worse reviews than for the same room at a price of 42$.
Same room , same host, but from 5* 100% I go sometimes all the way to 2*. Doesn’t even matter that even at 90$ my rooms we’re the cheapest out there and hotels were twice higher .
That doesn’t discourage me at all. I am making a living out of it , that’s all that matters to me
I blocked the winter off and decided to do some work (install a washer/dryer, didn’t have one before). It’s actually kind of a present to myself too cause I got tired of bringing linens home for laundering. I will never reduce my prices. I’ll sit empty and enjoy more free time. (Works well for me because I do alot of overtime in the winter at my regular job). I understand that policy won’t be feasable for all though. I’m at the lower end of full apartment prices in Chicago (when its warm) because my unit is quite small, though quite nice. It has a rare (for Chicago) & awesome very private deck area. It also helps that Im in Wicker Park Chicago. Wicker is a prime Chicago destination. Even with the winter blocked, I still more than double what I could get yearly from a long term renter. (Roughly $150 a nite and I typically book approx 25 days a month when its warmer). I don’t believe the increase of hosts will affect me much because 99% of them charge much much more than I do. It’s also really not feasable for them to lower prices much because then they are better off with a long term renter. And on a separate note, I do all the cleaning myself. I take the $40 dollars I charge and stock food and drinks for the guests. It goes over very very well with guests. Most actually don’t eat or drink much but appreciate the convenience. I dont mind cleaning while i have a cocktail, it’s good mental therapy and quality alone time.
And on a separate separate note… I have an Alexa. Above it is a sign that says “play Tom’s welcome to Chicago playlist”. This is the first song that comes up. It’s a bit crude but I’m kinda twisted that way. So far its gone over well. Everyone has a bit of twist buried deep inside them. I get a load of repeat guests that stay on average for 4-7 days. They realise that for what I offer, the price is exceptional. Hotels by me can charge up to 3x as much in the summer…
Yes, we have seen a sharp increase in supply, and significant pricing pressure. It is common for new listings to offer deep discounts to get their 10 stays, and get some momentum, get super host status. I did the same. But continued increased exposure to the opportunity, and so much “new listing” supply, many markets are sustaibably saturated with discounted offers. Just as the hotel industry Airbnb operators will need to refine their niche market, define and target their niche markets, offer unique property or experiences, and work to sustain respectable occupancy rates that make sense.
This morning I was checking the reviews to the guest arriving tonight. I see she stayed with another host on her way to CA and is staying with me on the way back. The host was already on Airbnb when I started in May 2014. At that time he was renting a two room one bath suite on the top floor of his home. A year or two ago he added a small guest house on the back of his property. He lives in an older part of town where these are common so I imagine he just remodeled an existing structure. Now he has a third listing: an entire two bedroom, 1 bath, yard, garage and breakfast (!) home for as low as $65 a night for 2 people, no cleaning fee. He already has 85 5 star reviews. He allows one night stays.
It’s hard to believe he can even afford to clean and pay for utilities and maintenance at $65 a night. Maybe he gets more multiple night stays than I do since it’s so much bigger.
I allow pets and I get an average of two bookings per month of people traveling with pets or moving. I have a private entrance which most people offering a room in their home don’t have. I also have 250+ reviews, SH status and IB but there are dozens of us now in my city. I’m closer to the freeway than most.
Unless someone lives in a town with a push to regulate, it seems more people are going to sign up to do Airbnb and pricing pressure will continue to grow. The guy that installed my security cameras this week was just telling me that he was telling his brother he should get into Airbnb, in my neighborhood. 
It’s not for everyone and eventually people will drop back out. But as shown in my example above there are plenty of people who know exactly how much work is involved and keep expanding at very competitive prices.
For some reason I have nearly no competition in my area. I live in a small rural subdivision in Kona Hawaii. I just checked neighboring listings and there are the usual ones…
—Properties nowhere near here
—whole house rentals, not a competitor to me,
—hosts dividing up their lanais with cheap,screens and putting double beds on each side of the screen, again hardly a competitor.
—places far down the road which are advertising “our” beach as being an amenity of their rental.
There’s a severe housing shortage on our island, as there is throughout the mainland. I believe it’s directly attributable to the 15 million homes nationwide that were lost to foreclosure during the crisis beginning in 2008, when speculating banks crashed the economy and created fraudulent documents to foreclose on millions. Those former owners flooded the rental market, competing with other rentals, squeezing the market dry,
I could rent my place for maybe $1,000 tops. I rented one time LTR to someone whom I thought I had vetted well, but she immediately started complaining and then left and left a mess. Not a good experience and I won’t ever do it again. The laws favor tenants and I am scared of trouble.
Winter is my busy season. I make bank in December, January and February. I make more in these months than if I rented it long term all year, and without the wear and tear. I just had a guest cancel in the prime two weeks of the year, Christmas and New Years, but that is Airbnb for you. So far they have not received her documentation, but I am confident they will, as her medical thing sounds real.
Oh… I’ve been renting on Air since the beginning (very low listing number); have never been a super ho, and have only 115 reviews and about 4.6 stars.
Hope "super ho"
Was a typo 
My feeling is that Airbnb has become a race to the bottom. I’m constantly getting messages that I should lower my price. I don’t know what sort of properties they are comparing mine to, but I offer a completely private 2-bedroom apartment with 2 full bathrooms, indoor laundry, full kitchen, and screened-in porch. No, I will not lower my price to $43 a night! The suggestion is ludicrous. I do have a suggestion that might ease your workload between guests. There is a cleaning product called Mr. Clean Magic Eraser. There are now several knock-off brands available as well, but I don’t know how good they are. Anyway, Magic Eraser is what I use to remove scuff marks from walls. It will save you from having to touch up the paint so frequently.
I agree with that 
. I know that my superhost status that won’t last that long for sure was all credit to my pushover husband who does everything guests asks for. He never ever would say anything even if a guest did something really bad. Example: chain smoking Alex for 2 months when I was away. My husband just can’t help but being a sweetheart and ready to please. AC on 60F ? Sure help yourself. Do you want open windows with that too? Even better! To top it off with the low price and superho status is achieved.
If you live in an area where the law favors tenants over landlords, it is scary to have long term tenants. Where I live, Los Angeles, CA, it can take six months to evict a tenant for non-payment of rent. During this time the landlord incurring costs to evict the tenant, but the tenant is living on the property free of charge. If a landlord evicts tenants because the property is being removed from the rental market; the landlord must pay relocation fees to the tenant. These fees can be close to 20,000.00. If your property is under rent control, you can be receiving much less than market value for your property.