We got a booking, with a sting in the tail...!

1

The last time we hosted an Airbnb guest was July last year, and since then we haven’t had a sniff from them, other than a few enquiries about LTR which we declined.

Fast forward to last week and within the space of two days we had two IB’s and a RTB. We decided the RTB wasn’t a good fit, but both IB’s are communicators and unless something drastic happens, I’m sure they’ll both go ahead.

We moved over to the host paid service charge last year, it’s mandatory for software connected hosts in Spain, and many other countries I’m sure. Instead of 3% commission to the host and a variable commission to the guest (typically 12-17% I believe), we pay a 15% commission and there are no fees to the guest.

In principle, for us, it’s a good idea. It makes pricing easier as it’s the same as BDC’s base commission, although there is an additional 1.09% payment charge with BDC, so essentially our gross commission with BDC is 16.09%.

What I hadn’t realised (well, forgotten more like) was that Airbnb charge VAT on top of their commission, which in our case means instead of taking 15%, they actually take 18%. Bastards.

Every other OTA take their cut with VAT included. I’ve just checked BDC and Vrbo to make sure.

I’m now wondering if Airbnb will roll out the host only service charge to the rest of their host base, as it would make sense (from their perspective) to have all hosts on the same financial arrangement.

Incidentally, Vrbo are seriously considering moving over to host only service charges for those that are on the “pay per booking” plan. We’ve taken part in two surveys recently gauging hosts opinion to this move.

Anyway, as a result of this, I simply raised our Airbnb prices by 3%.

JF

6 Likes
2

We moved over to the host paid service charge last year, it’s mandatory for software connected hosts in Spain

Is it??
M

3

Well, according to Airbnb it is:

JF

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Your service fee structure will change on 07/12/2020

Starting 07/12/2020, we’ll be switching your listings to simplified pricing – a new service fee structure that gives you more control of the final price that guests pay.

What’s changing

Today, there are 2 service fee structures: split-fee pricing with the service fee shared between hosts and guests, and simplified pricing with the entire service fee covered by the host. After 07/12/2020, split-fee pricing will no longer be available. That means a 15% service fee will be deducted from your payouts, and no fee will be charged to your guests – what you set is what guests will pay.

Why your listings are affected

This change applies to you because you have a listing in a selected country and connect to Airbnb using third-party software.

Why we’re making this change

We introduced simplified pricing last year, and hosts who tried it out and priced competitively across websites got an average of 17%* more bookings. We heard that removing the guest fee made it easier for hosts to price competitively, and we saw that guests preferred to book places that didn’t have a guest fee. This is especially important for your listings, since guests usually don’t pay fees on other booking platforms in your region.

What will happen next

This change will happen automatically on 07/12/2020 and will be applied to any bookings that you get after that date. We’ll send you a reminder 7 days before this change, along with a guide to walk you through changes you may want to make to your prices to ensure your earnings don’t change.

Here’s a summary of what will change:

  • Your service fee settings will automatically change on 07/12/2020 for all your listings
  • We’ll deduct a fixed 15% host service fee from each payout and won’t charge a guest service fee
  • This won’t affect any existing bookings you have and will only apply to any bookings you get after 07/12/2020
  • Using Airbnb after 07/12/2020 means that you’ve accepted this new service fee structure

Read more about our service fees

Thank you for being a valuable part of our host community

We’re committed to supporting you and your hosting business and will continue to invest in tools and product changes to help you grow.

*Average observed increase in bookings for hosts using simplified pricing in Europe between November 2019 and February 2020. Actual results may vary for each host.

4

I hope they don’t add me into that “all price included” program, the structure now/here makes sense for me in Los Angeles area.

5

Ok using a Chanel manager or other third party software sorry as direct one has a choice 3 & 15 or 15 & IVA …,
But they will nudge everyone to the latter so the customer does not see the milking by portals…

6

No, according to Airbnb you have no choice now in Spain. The section that used to be under “Account” where you could make the choice has disappeared from our dashboard, and that of another host here I know. No way to change it.

Incidentally, got a couple of your nearish neighbours staying just now, from Lalín. I don’t think they like the heat, heard the aire battering away last night!

JF

7

I m going to check when power is reinstated just now we have thunderstorms .,. Yes normally we get the southerners escaping steep pricing and humid nights visiting here…