Smart pricing below minimum

Hi all, this is my first post here so please be gentle with me! I am a new host and have my 5th set of guests arriving today. Theirs was a last minute booking and is the second that has been priced below the minimum price I’ve set in Smart Pricing (even taking into account host fees). Is this normal? I can’t see anything on the Air website about it but might have missed it. It’s a small amount but annoying nonetheless!

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I have been seeing this a lot lately on my page. Has something to do with price tips showing lower prices, you accept, and then there it is. I have taken to manually setting my prices. I am simply not going to rent out a three room suite, with a breakfast, for their suggested price.

I was just looking the smart price price idea and got shock with such low price.
For this kind of price, we are earning more with long term regular tenant

You don’t want to use smart pricing when starting out. It has no gauge yet on what your listing can go for. It also sets a much lower price than what you can actually get to get you booked quickly. But it will burn you out.

Even when I set my prices 50% higher than price tips when starting out I still was the lowest price for what I offer in my area. I was ok with that for my first 5 bookings or so because I wanted the positive reviews. But I now charge 100% more than what I did for my first booking and about 200% more than the initial price tips I had and even in November in St. Louis I’m already 50% booked for this month. Usually by the end of the month I’ll fill in most of those spaces.

There has been a trend noticed that they under-price new hosts. You have to train the price tips for your place, and I’ve always had my rates about 10-30% more than even my current price tips and I still get booked. Would you rather be 100% booked and worked to death, or be 80% booked and actually make more money with less stress by raising your rates? I make more in 1 month now than I did in my first 2 months fully booked and my sanity level is much better, lol.

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Thanks for your responses. I’ve been gradually increasing the min price but perhaps I should give smart pricing a miss until I am more established. :slight_smile:

Me too. When I first started using it, it always set the prices to the minimum I’d set but now I’ve ‘trained’ it, it asks for more than I would.

I checked out the Smart Pricing when it first came out and thought it was ridiculously low. I agree with @Sarah_Warren… better to get less rentals at a higher rate. Your set rate will eventually influence what the suggested Smart Rates will be in your area (IMO).

I never go by the Smart Pricing, but use it as a gauge. I just checked again to see what their suggested rate was, and it’s actually higher than what I charge for a longer rental (my nightly rates vary based on length of stay).

I have the opposite problem than @Daisymead - our home is in an area that is SO expensive to rent that I have to keep raising my rates in order to NOT look like our home is sub-standard. I actually don’t feel good about charging people so much. Being in Canada we get lots of US guests who can take advantage of the very low Canadian dollar. Now Canadians and families cannot afford the prices.


Thank you wise forum people - I switched off smart pricing and already have another booking at the highest price I’ve had so far! :grin::grin:


I was glad to stumble on this post today. I reviewed my listing and almost cried. The price tip was lower than it would cost to provide breakfast for two people, much less the cost of cleaning up, laundry, and replenish amenities. To ad insult to injury I’m not in a very hot market area and have not yet had my first booking yet.

I offer a room, and breakfast. That’s all. I don’t have multiple listings, I don’t have a separate entry or building. But my room is nice, comfortable, clean, and I’ll feed you a little. (sigh)

I hope to have better photos soon, but I just can’t charge less than the no-tell-motel.

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Please don’t pay any attention to the price tips! We’ve used IB almost from the beginning so it’s hard for me to remember the price tips thing, You and you alone know what your rental is worth.

My experience with smart pricing is similar to the other hosts who have responded to this thread. The smart pricing tips are extremely low in my case. I price manually at this point. Yes it is more work as it requires frequent adjustments, but I’m not going to let the “smart” pricing sell my room for dirt cheap especially on premium weekends and other event days.

I think that sometimes here there is confusion between price tips and Smart Pricing. To try to clear this up, pricing tips are just that, tips. They are there to be ignore, as far as I’m concerned. Smart Pricing, on the other hand, works great as long as you manually adjust prices from time to time to ‘educate’ the system.

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New host here! I am confused at how Smart Pricing is working. Actually, it doesn’t seem to be working going forward. My first couple of bookings in the month of March were set by smart pricing at $112. Now looking forward, I see a sea of $80 range (even over the 4th of July weekend). That doesn’t make sense - should be more than early March. Basically, Smart Pricing seemed sensible in the first couple weeks of my listing and now it is nose diving even though I booked five guests in two days. Too bad because I could use the guidance for pricing.

Smart pricing does not appear to do very well over every high demand times. I’m in an area where a lot of non-standard holidays and random days get very very popular and smart pricing will cause you to miss out on good prices.

For me, smart pricing is not smart. I’m willing to put in the time to price my listings manually.

I’m pretty sure every host here has come to the conclusion that agreeing to smart pricing is the most stupid decision they can make for their business. I also found that the smart price is only “smart” if hosts double it for the best true price.

I liked the conspiracy mentioned by someone that it probably only came into existence as a way for Air to increase their fees: if they can convince hosts that $50/night is a great deal, while the hotel nearby is charging $100, then Air can command $40 in fees and the $90 total is still a better booking deal for the guest than the hotel. If, on the other hand, all hosts charge nearly the same price as a hotel, then the margin for fees is significantly smaller before it starts to look like a bad trade-off for guests.

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