Today I got an email with a new “Firm” cancelation policy.
It fits between strict an moderate.
I always hated to use strict, but moderate was too much of a risk.
Why should a guest pay 50% canceling months before arrival.
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I find that the strict policy is the way to go. You can always make exceptions or explain your own policy in the listing details and house rules if you want.
I’m still not okay with stays over Christmas or New Years being cancelled 7 days before arrival and having to give a 50% refund. I try to only get direct bookings for holidays and use my own “No refunds on holidays unless we are able to re book the same nights and prices.” policy.
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Thank you for posting this. There are over 4000 STRs in my city. A strict policy is a deterrent to advance booking.
The Firm policy is almost the same as the cancellation policy used by the local STR property management companies. I like it!!!
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I have the peak high season blocked on all OTA’s.
Why give them money when I can get direct bookings.
But the strict policy is a big deterrent for new users. They rather go to BDC or any other platforms. And 30 days, for me is plenty of time to get a new booking.
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I’ve always used moderate, and it’s worked fine for me. But for hosts who are used to Strict, Firm seems like a nice alternative for some. I know that even reasonable guests who understand that expecting a full refund close to check-in is unfair to the host, think it’s pretty unreasonable to pay 50% if they give a month’s notice.
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I’m not likely to be changing my policy. Strict has always worked for me. I plan my other work and vacations around my bookings so it’s not always possible to replace a lost stay
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Yay! Just changed my settings from Moderate to Firm. Thanks for bringing it up! This works well for me; I market for medium-term bookings (6 day minimum) so each booking has a big impact on my calendar availability.
I can appreciate that a guest would be hesitant to book a long stay with no possibility of a refund if things change, especially with our recent experience with travel restrictions.
It felt like choosing Strict would limit my market too much. I am geared toward people who plan ahead, and I think these same people would be reluctant to choose something that offers no backup plan.
A month’s notice seems reasonable to me, and I have no qualms about taking the 50% if they cancel later— it’s not easy to rebook the longer stays.
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Me too-mostly. I’ve had a couple of cancellations followed by a rebooking for less time. For example M-Friday booking, I’ve got 3 night min, rebook M-Thur so lost 1 night
However it all depends on market. If I can rebook, I’ll gladly refund
Here is what most STR agencies are using in my area
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For those agencies, how much would the deposit be? I think giving up a deposit is different from giving up the full rental fee.
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Fair question
Because the rental is paid in full sometimes months before the rental BUT there is the risk the owner could cancel the rental contract with the agency and/or sell the home/condo before the stay starts, they call it a deposit.
So yes, they are forfeiting the cost of the rental if they cancel.
Most agencies require a $500 damage deposit or purchase a damage coverage policy. If no stay occurs, it is refundable.
Your question makes a good point it is important to understand the definitions.
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That is why more and more guest learn to use AirBnB and BDC as a search platform, and then book direct at much better conditions and prices.
Guest booking trough Air or BDC pay 20-25% more to stay at my place, compared to booking direct with me.
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Sounds like you’re being screwed by your OTA’s, in our case it’s around 18%.
JF
Plus that 10% -15% genius discount that they offer to all and sundry!
I don‘t say I am paying more… my guest pay more.
In out Area BDC rates for the hosts are 14%, Air is about the same.
You aren’t making sense. On Airbnb, if you are paying 14% service fee, you are using the " host only" service fee model. Which means your guests are charged no service fees at all.
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I’ll need to look into this! I wonder if they offer the Firm or Non-Refundable option. I currently use the Moderate or Non-Refundable option.
Update: yes! It is offered.
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Yes, I use the host only fee.
That means I have full control over what rate the guest pays. So it is my decision to have my guest pay 20-25% more when booking trough an OTA.
It works well, I get a lot of guest that decide to book direct after seeing me on one of the OTA’s.
I’m having a brain lapse. OTA means….?
I should know this but I must need coffee
I still don’t get it. You were complaining that the guests pay 20-25%, but you are choosing to do that yourself? So it’s a way of discouraging them to book other than direct? But how do they know it would be cheaper to book direct if they make contact through Airbnb or BDC?
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