I have been noticing for the last six months that the private room prices have been falling through the floor they were $65 and now I see some decent rooms for $29 ! Then what I figured happened; entire home prices have started to go down. I think now there is just a glut of properties on the market especially in the private room market since anybody can do that. I have not lowered my prices. I just refuse to do that! Instead I just go in and try to tweak my listing and make it the best that I can . There are some great apps out there for the iPhone that will help you make your photos really stand out. I also rewrote my entire listing for some reason that seemed to help get me more bookings but I just refuse to give in and lower my price . I have seen how the market is changing!When I started the no 1 host had the no 1 position and lots of bookings. Well…he has actually pulled entirely out of airbnb! He used to book over 2500 a mo then his biz just dropped I think because he kept his listing and pics ways the same and he got a couple bad reviews. Also new properties come on the market everyday, some are pretty slick!! Huge swimming pools, brand new guest homes, modern too and reasonable. This market is changing for sure; I hope I can keep the bookings coming!
you are totally correct. It has been happening since ABB began.
Good for you! I hope you’ll stick to your guns. I’m in a very popular area and like just about every established host, I have the same problem. I get new rentals springing up all the time, even right on my street.
The only thing we can hope is that there will be a good fallout rate and I’m willing to bet that there will be as soon as these new hosts realise that they are losing money - as they must be with such low prices. Once they realise the wear and tear costs, the added utility costa, the need for proper insurance, the cost of replacing worn out or damaged items etc. etc. then their bottom line isn’t going to look good. Even consumables and laundry costs add up over the year.
There’s also the issue of legality - how many of these hosts have the permission of their landlord, condo board or homeowners’ association? How long before the neighbours complain?
Then there’s the time required to be a good host. And the dedication to making sure that guests get a really great experience. All these are things that will drive hosts to either raise their prices considerably or give up the ghost. I’m an optimist and hope that most guests believe ‘you get what you pay for’ - not everyone buys on price alone.
I agree I don’t understand how some people can manage with so low price. I guess they don’t pay tax
I think some people might imagine that they will be booked every single night. So they multiply (as an example) $30 x 30 nights and think “$900! Way more than I could get from a room mate.” But after a while, as jacquo says they will get tired of the work, wear and tear and interference with their privacy.
I have several “competitors” in my town offering a private room and bath for a lower rate. They keep getting bookings and reviews and they keep their lower rates. But I keep getting steady business as well. Maybe people are willing to pay $10-20 more for a private bathroom or off street parking or closer to freeway or more reviews. Maybe my competitors book up sooner at lower rates but when someone looks last minute only my place is left.
@diamond54 your attitude of just being the best you can be and not worry about others is a winning one.
You’ve hit it on the head, @KKC. I’ve noticed some new pop-ups in our area as well, and I don’t know why they offer such a low rate. But once they get filled up we’ll eventually get the bookings.
This just happened this morning. Someone inquired through ABB so I went on to see what my competition was. There aren’t nearly as many homes available to larger groups, but the new, low-ball one was also available.
I just noted the reasons why they would want to book mine in the reply. In drawing attention to particular things I’m hoping the guest will look to compare those items with the competition and see why it might be worth paying a little more for mine.
I think of my neighbor who was the first airbnb in my town. Then I came along and had cheaper prices - but her place was much nicer. I think of how that must have felt. Now we both have tons of competition in my town and yes, prices are dropping. I hope that @jaquo is right - and I keep telling myself the same thing.
I’d love to think that with all the collective brainpower and skills in this forum that we’ll be able to fight back!
so I noticed one of my competitors dropped her price $20 a night!!Think about that! That is a lot of money!AND she doesnt charge a cleaning fee OR a second person fee!!! I have been checking her calendar and guess what…the lower price has not yielded anymore bookings! Her cover photo looks like motel 6 even though she has a nice pool. So that proves that sometimes lowering the price wont even help!Yes, I have even seen a private room for 20 a night. Really? You can make more by renting out by the month and not have any cleaning to do! Ha maybe they are just lonely…or stupid or both!
Yes, in some cases that is true. Especially if its a newbie trying to break into the market and they have a nice new place. But yes, I noticed that I book up at the last minute after the “cheapies” are booked.I was a bit worried about January as of the first of Jan I only had 3 days booked…but now suddenly I have 1850 booked with one week left open so I just fill up at the last minute,that stresses me a bit but Im glad I held out for my price.Im not going to participate in a race to the bottom.My goal is to make a Minimum of 2000 a month.
I rest my case.
I think I’d rather revert to long term tenants (no cleaning!) than lower my Airbnb prices.
Well done, you! That is so satisfying, isn’t it?
I have found in just the last couple of days that people are suddenly booking, too. In fact, Airbnb is my 2nd or 3rd source of bookings - VRBO by far usually gives the most referrals, but last night I got a nice ABB booking and another serious ABB inquiry this morning… praying that one works out because I love to host family reunions.
@diamond54 - Good for you for not caving. I actually just increased my spring/summer prices double. Those are always extremely busy times in our city with every hotel and Airbnb booked up. You don’t want those cheap guests anyway that will pay $29 a night and expect a fancy hotel with housekeeping services everyday, free breakfast, Netflix and a ride to the airport.
There has been a great increase in entire place listings which makes it harder for private room listings.
However, I notice as has been mentioned that quite a few entire place listings, even those with good reviews, pull out presumably because the level of income at lower prices isn’t worth it when you take into account the overheads you bear, which would ordinarily be borne by the tenant in normal rental!
I do not have a private room, but I am in a market with a glut of properties, and I do book private rooms when I travel in other markets. The key I have found is to keep ahead of the competition by setting your rental apart with up-graded sheets and towels, classy, understated furnishings, and little touches like great lighting, books, toiletries and art. I find that the hosts that offer these are booked more. I talk with hosts, and my guests talk with me - these are the things which you may have an initial capital outlay, but then not much more. My high quality linens and towels are wearing very well. I have not had to replace anything!
I recently booked a room in the Bay Area, which I know well. The hosts had seen to every little detail - black out drapes, feather pillows. They offer 2 private rooms, are NOT in SF or SJ and are booked often.
I applaud you for not lowering your prices! Stand firm, and stand out! You will prevail, as the lazy hosts who think sheets are sheets, and coffee is coffee will be weeded out soon enough. Oh, one last thing: make sure your photos are TOP notch! I spent $225 for 15 photos, and it paid off. With a smaller listing you could most likely get photos done for $175?
You are quite correct. When I first had an AirBnB place some 6/7 years ago, there were 400 offerings in my city and only 12 of them compared with mine. Now there are over 10,000, and I have over a hundred direct competitors. Many of these people make very little, and unfortunately they think that the only way that they can compete is by lowering the prices. This is encouraged by AirBnB.
Staying in my apartment is less expensive by far than a hotel, and the standards are higher. We have a rating from the tourist board which is close to 5 stars. But, the hotel association is starting to complain, even though they are not losing business to us.
The only way to compete is to make your service better! Pristine fresh linen, super comfy beds, great TV offerings, great arrival kits and a willingness to sort out any problems both perceived and real, really fast.
We remain almost fully booked, some 65% from AirBnB and the rest from other sources. We are also pleased to get some people returning.
Yes, I invested $25,000 to make the geusthouse nice. Granite kitchenette(but no stove). Full size stainless fridge etc. I had the walls skim coated and re textured to make the room feel new. I bought a 55 inch flatscreen with all the bells and whistles. There is a huge private garden for their enjoyment. I have 60 photos, I did take my own photos because I wanted to take the time to stage.With all the apps on the iphone I can change the lighting and imperfections etc…So far we are doing ok even in the slow season we are making 2000 or more, which makes our mortgage.But you have to really be on top of your business in every little detail. I notice in my area only about 8 hosts seem to have all the bookings…everyone else has very little or none.
Thats exactly what i did: longer term. Last year was definitely different, prices were higher, and there were not as many listings. I feel it with both properties, separate house and private rooms. Before i could kind of predict if i am one of the few for that price, and on IB, there is a good chance i would be booked. Now not the case. Then i go look at hotels. Hotels prices are lower too this year. May be because of canadians who cant recover from their dollar fall or lack of Europians with euro going so low, but to rent it for a couple days at a time for higher price is very challenging.
I started in Aug 2016 and purposely underpriced so I could get reviews and superhost rating. I just hit it a few days ago, and raised my pricing accordingly. The superhost rating helped immediately. I got three booking requests the next day.
London is now just under 50,000 listings. Unfortunately that means lower prices; I have seen double rooms listed at £20 in zone 1. Obviously once you scale it up to 3 or 4 rooms each at £20 the price is ok for the whole property but it makes it horribly competitive.