Airbnb Answers: Early Host payouts

[Airbnb]

You asked: Can Airbnb allow hosts to receive an early payout at the time of booking?

This is a great question, and one you’ve been asking for a while. We’re developing the best approach for early payout arrangements, starting with a small pilot program in the U.S. 

How the upcoming U.S. pilot will work:

A limited number of hosts will be invited to opt-in to the early payout pilot. For those hosts who opt-in, we’ll send 50% of your payout 3 days after a guest books and the rest 1 day after guest check in, for a 1% early payout fee on the booking subtotal. For reservations booked within a 14-day window, you’ll still get the early payout, but you won’t have to pay the early payout fee.

Long-term reservations (28 nights or longer) are not eligible for early payouts. For reservations booked more than 4 months in advance, we’ll release the 50% early payout when the check-in date is 120 days away.

If a host or guest cancels a booking after an early payout has been made, that amount will be deducted from your next payout(s).

We’re excited to see how this program goes, and would love to hear your thoughts on the concept. We’ll keep you posted on future opportunities to get your payouts early!

In the latest Host Q&A, CEO and Head of Community Brian Chesky answered top-voted questions during a livestream event. For questions he didn’t have time to address,  we’ve introduced the Airbnb Answers series. Want to ask more? We’ll invite hosts to ask their questions before the next Host Q&A event!

[Vail-Butler0]

I am very happy to hear you are moving forward with early payouts as it is a crucial part of our vacation rental business. If you take a look at Homeaway, they have been offering early pay-outs since the begining for no extra charge, which makes AirBnB less competitive in the vacation rental marketplace. I do not mind the 1% charge and would love to be part of this pilot program. As a matter of fact, we have 3 homes that will not allow us to use AirBnB due to your current pay out structure. Just imagine, if you had a $10,000,000 home that rents for $60,000 over Christmas. That is to much liability, not receiving the money early, even if the policy is 60 days, no cancellation. I think this early pay-out option will give AirBnB more of an advantage for higher end homes and property management companies. Please let me know if I can be apart of this pilot program as it would help my business and yours. Hope to hear from you soon, thanks!

[Dave53]

Sign me up! I'd love to get more info.

[Mary842]

When will they start with early payouts? 

[Dawn245]

How do you become part of this program? I use my Airbnb income to supplement my part-time college instructor income. I have been considering moving over to VRBO because of their payment practices, but will stay with Airbnb if this is changed. Please let me know how to apply for this early pay-out program and how long it will take before this option is offered. Thank you, Dawn

[Stephanie365]

@Airbnb 

When a guest makes a reservation and pays at the time of reservation, AirBNB is in essence holding the money in escrow to be paid to the host upon completion of the transaction.  You are already being paid for your services for this, by both the host and the guest, in the service fees you charge, which can be anywhere from 8% to 18% per transaction, plus the interest earned while you're holding the monies. In some cases you're holding the money for over a year and earning interest accordingly.

I think you're taking enough of everyone's money as it is. I think the 50% advance payout should be standard without a surcharge.

People really despise being nickeled and dimed by cubicle dwellers in corporate offices.  Stop being greedy.

[Shannon120]

Personally, I do not want this option. It's too difficult for refunds, accounting, etc. I would request that this always be an option, not a requirement. 

[Matias78]

Esto generara mas complicaciones que soluciones Señores. A mi me paso que me hicieron el pago anticipado de una reserva de 1 mes que se cancelo 10 dias antes de la llegada. Me pagaron por una reserva cancelada en tiempo y forma, el estado me cobro el 28% de impuestos y Airbnb me solicito el reembolso del 100%. Es decir que gracias a su pago anticipado yo que reembolsarles un 128% de mis ganancias. Algo totalmente injusto.

Es muy contrapoducente el pago anticipado.

[Stay-Asheville0]

It's hilarious that so many people are so against this... technically, in a lot of states, you're required to hold the advance rent in a trust account until the day of check in anyway.  Can you imagine the risk involved in paying people in advance on everything?  It's the financially responsible thing to do... and it's a small price to pay to have Airbnb literally handle every aspect of the payment and verification of guests.  

I think this is amazing.

[Daljit0]

I think the problem lies with a host taking money and then refusing to host the guest. Hence the reason why payments are released after the the booking starts to ensure they exist.

AirBNB keep saying that the platform is based on trust. Perhaphs for superhosts and those that have hosted for example 50+ bookings the rules should be different as the trust clearly exists. The rules for cancellation for the host would be the same and the host woudl get penalised.

[Tamara-and-Goykoh0]

We in person actually find it better not to get money before check-in. It is a great argument with "problematic" guests which experienced hosts can recognize after a few sentences in a first message. Also, it is a great savings tool. If we get the money before check-in we will spend it for one or the other reason, and when guest arrives we'd have a feeling we host him free of charge. Not a good feeling. On the other hand, as someone already wrote, if we have constant income, it doesn't matter from which reservation it comes, etc, etc.

The only problem would be cancelling right before arrival. But hey, let's be honest - that happens mostly (if not only) in two cases:

A) to your guest something bad has happened, or

B) your guest is unreliable.

In the first case we would never like to get bad karma by earning on someone's trouble, calamity or whatever.

In the second case, we are happy not to host unreliable guests. Good karma always, 100%, compensates it later when you expect it at least.

We find it fair paying fee for taking money in advance only if we can choose second option - to get money after check-in without any additional fees than 3%. Although, in real it is far more then 3% because we loose additional 3-4% on guest currency's conversions to your credit card currency (when that is your payment method), than additional fees on conversion from the curency of your credit card to your local currency if they're not the same, etc..

But, we think that huge improvement would be refundable/non-refundable policies. That way, we think, it would accelerate cash flow. Anyway it is different subject and we're not sure it is in AirBnB's interest - it'd actually probably lower their income, because A) guests mentioned above in any case will not make income to anyone, and B) guests will  nevertheless make income to AirBnB. Regular guests using non-refundable option would lower AirBnB's margin.

[Linda_Ron0]

Today is the first I ever heard of this early payout.   Discovered this accidently when I received a Airbnb message that I was receiving less then half of my income on a current reservation.  When we called and spoke to a Airbnb rep we were told that since we accepted the early payout that $174 is all we would get on a $436 reservation.  I told my husband that either Airbnb is becoming like the local Mafia with high interest rates or this rep didn't know what the hell he was talking about.  Now I find out it should only be an extra 1%!!!!!   After over an hour on the phone telling this guy that this was wrong  this rep drew up a "ticket" and someone would get back to us.  He couldn't tell us how anyone would get back to us,  nor when they would get back to us.  In the past I have been happy with the phone supports with Airbnb,  but now my opinion has seriously changed.  

[Sharon608]

I rent my property in the summer season and the majority of the reservations are made in the wintertime. Working with VRBO gives me cashflow because I receive half of the income when the reservation is made. I'm new to Airbnb and I'm disappointed to learn that I'll receive no income for reservations made nearly a year in advance.

I found this discussion about an early payout option. Although I don't believe there should be a fee attached to this, it is more important to me to have cashflow yearround. How do I choose the early payout option?

[Colby9]

I have been trying to get an invite to this program for over a year.

They have been running this program for close to almost 2 years now.  I was originally told that when I obtained Superhost I would qualify because I already met the other conditions.

I goofed when I setup my very first listing on instant book and had to cancel my first resevation with-in minutes after it was booked. This made me ineligable for Superhost for an entire year.

I worked my butt off to honor EVERY SINGLE one of my 2000+ reservations during my first year on Airbnb. When I acheived superhost requirements in February of 2018 I called and was told yep you are eligible. You just need to wait for your Superhost review to be complete at the end of the quarter. I called back after that happened and was told that now it's invite only.

I hope to get an invitation to this program. I have used Clearbanc in the past and paid close to 10% to receive funds upfront to expand my portfolio of properties. I would gladly pay the 1% fee. I hope I get an invite soon!

[William791]

I have $1.5m in properties and have been listing with VRBO for 10 years.  Their payout policy is 50% immedialey,  with a 3% charge and then I pick the date I want the final payment and that is 45 days prior to the rental date.  This has been working for 10 years with VRBO and me the host, so it should work with Airbnb.  Another cenario, which could work and protect the guest is release the 50% to the host after the 48 hours for the cancellation has passed, then release the final payment after the guest has passed the "no refund date or cancellation date."

Airbnb needs to put a policy in place soon to stay competitve and to respectfully treat its hosts as  customers ! 

[Norene1]

For the past two years I've received early payout which was perfect for my situation. For the life of me I CANNOT locate the window or tab to choose this option. Where is it? I get the information from the FAQs but they don't help.