Wondering everyone’s thoughts on this…
I have an airbnb that in the past hosted 2-3 night stays from businesspeople coming to my area. BP (before the pandemic) my rate was competitive, Now, I am of the age where I am at high risk, and I am thinking that upon reopening I would need more money to make the potential risks (or more candidly the more intensive sanitizing) work.
I am thinking of raising my rate 50% or more since that would make it worthwhile for me.
Have any other hosts thought about this or are actively showing much higher rates? Do you think it matters in ‘the long run’? Thoughts in general on this?
I have been working on our post pandemic pricing today.
I have come to the conclusion that I haven’t a feckin clue.
Tomorrow is another day, I’ll revisit it
I suspect that the ‘competition’ is going to fade away quite a bit for a lot of us. Over the last few years, most of us have seen the number of hosts in our local area increase every week as people have decided to ‘try Airbnb’.
Many of my neighbours did exactly that. They gave it a try with ridiculously low pricing which forced long-standing hosts into a price war … it’s all a familiar story. And then of course they realised that it means work and it’s not money for old rope so disappeared.
The current situation might make even more hosts decide that it’s not for them.
So because it’s likely that you’ll have less competition, a price rise is workable. I’m sure that you’ll offer your guests great value for money.
We’ve had our studio shut down but I opened it up for August a couple of days ago. I put the prices pretty high, what I would have done for a “normal” summer. And then I ran the “price tips” the next day and they were quite a bit higher with that message of “listings like yours are in demand”. So, I’m kind of confused about it all. It’s definitely a wait and see.
But yes, you should raise your prices and make it worth your time and risk.
The potential risks don’t appear to be weighted towards sanitizing things, it’s sharing space with people who are shedding virus. So you have to weigh risks if you share space much differently. And is it a business person who is going to visit a dozen potential clients who don’t think the virus exists? If I still hosted in my home I’d have to have a no shared spaces use rule then I’d probably lock myself in my room for the duration of their visit. I used to ride a motorcycle without a helmet. I had no fear of dying in a mc accident. I do fear dying alone after 10 days to ? of covid.
As for prices, I made my room available at my old price about 4 nights over the last weekend and I got no bookings. I haven’t spent any time looking at the competition as I’m not available again until late July.
We can speculate that many over leveraged hosts will leave the market; we can speculate that hosts needing income will enter the market.
I have never lived through anything like this and neither has anyone else. We are all making wild ass guesses as to what will happen. Even if someone with a similar rental gives you some input you won’t know if will have relevance in your market until you try.
I experimented with raising my prices last year and made more money with a few less stays. If/when I reopen (I’m in a bit of a hot spot, new cases/deaths leveling but not declining), I will raise prices more, require 1 week minimum, block 72 hours between stays, and see what happens.
Previously my guests were split about equally between those visiting local family/friends, DC tourists, and business travelers.
I will advert as a safe place to stay (it’s a completely separate suite attached to the back of my house) and will relax my no visitors rule and say that visiting friends and family can social distance in the backyard. I don’t expect to get the business travel traffic back anytime soon, or maybe ever as I think the acceleration toward remote work will stick. And the tourist traffic I don’t expect to recover for at least a year.
Not raising rates if we decide to stay in the business, but will add a cleaning fee. Also considering two night minimum. Offering one night stays helped us lure a lot of travelers since we are not exactly a vacation destination.
Hmmmm, I already have a small cleaning fee. Perhaps a similar-to-before nightly rate and a much larger cleaning fee? Or a hike in the nightly rate alone? What would look better and more attractive for the guest?
I think most guests realize that cleaning is costing more everywhere so it would make sense. Plus your longer stays get the fee spread over a few days.
I am contemplating raising my prices during prime months, not for the additional cleaning, but really to offset the gap days that are now required. I used to have same day turn-arounds during my busy months, but current cleaning requirements will negate that, while increasing vacancy rate.
Predictions are that business travel is probably not going to be at “BP” levels, as people get used to doing more work virtually, and remain concerned about contact with multitudes of strangers. With that said, you can raise your prices but if there are fewer business travelers the demand for accommodations may be less, so unless your competition is reduced (as others have suggested) you may be impacted by Supply & Demand. I think we all have to wait and see.
EXCERPT FROM THE ATTACHED ARTICLE.
Research by Citi estimates that corporate travel could be impaired by about 25 per cent versus 2019 levels, driven by the proliferation of virtual meetings and varying quarantining and border rules for the foreseeable future. This will make it a “struggle for a lot of airlines that carry international and business travellers . . . to make money,” said Mark Manduca, aviation analyst at Citi. Corporates are already showing signs of reassessing their policies. Jean-Sébastien Jacques, chief executive of mining group Rio Tinto, said its spending on long-haul could fall by as much as 75 per cent over six months. “We used to have a big budget for international travel between continents and I am sure that is going to shrink very quickly.”
seemed humorously aligned with this topic.
I just got an email that a rescheduled to 2021 performance of Les Miserables has been cancelled. Other shows have been moved out to 2021 but obviously there is uncertainty as to what this will look like over a year from now.
For the time being we are putting on a smile and hoping for the best but behind the scences those with access to the best, unbiased science are prepping for more pain ahead. I think we are well advised to do the same.
I think @JohnF will be speedily repurposing this
Translated it actually just about to suggest it to mine host. Too many feckers sitting drinking coffee and sin alcohol cerveza.
Got the last table on the pavement. Didn’t have to resort to having a little cough…
He is, of course, the consummate professional
You’ve reminded me of my mid life gap year running a bar in Portugal (same skill set as being a psych nurse), when August brought Spanish tourists in droves, who sat drinking a SINGLE coffee all evening. To be fair, the Lisboa contingent were just as bad.
I dealt with falling revenues by hiding the coffee machine, then showing a jar of Gold Blend to anyone who asked. Instant coffee = instant departure; result.
I did have one bunch of Spanish students who came every night for a week, and drank themselves through the menu of cocktails, ordering jugfulls at a time. And they were such fun too.
That will have been the snobby Madrileños who are in so much debt a coffee is all they can afford.
Us Jerezanos are a different breed, our city RUNS on alcohol, literally!
Gracias Paul, you are just too kind. If I manage to get the correct licences for my sherry tours, then I really will be a professional drinker
In that case, I shall be opening another bar when we manage to get back to Portugal! An honesty bar in the garden, for Jerezanos only.
“You’ve reminded me of my mid life gap year running a bar in Portugal (same skill set as being a psych nurse)”, HAHA My very wonderful cousin lived above a Greenwich Village bar where she tended. She is now a psych nurse!
We here at Tiny Tiki have raised our prices and our cleaning fee.
This is interesting and I’m curious to see if this works. I’ve been slowly raising my rates BP to test the market, but have thought I might need to lower rates once I reopen. I have noticed hosts in my area have slashed their rates during the pandemic, and I thought I’d read somewhere about guests expecting more discounts during the pandemic. Do we think that guests will have the upper hand when this is all over? Will there be enough hosts desperate to get any income for fear of losing their home that they’ll set rock bottom rates? And what about us homeshare hosts? Will that market ever pick up again?
On a separate topic, but related to your concern about your health, one thing to consider is that there is a growing portion of the population (at least in the U.S.) who thinks this pandemic is all overblown and some even think it’s a hoax. I am definitely not one of these people, but what if one of your guests is–will they take your precautions seriously and wear a mask in the house, wipe off door handles, stay away from common areas (or whatever it is you choose to require), or will they be one of those people who protest and say you’re violating their civil liberties?