Airbnb's New Fee Structure for Professional Hosts 15 %

[Noemi20]

Recently Airbnb has changed her policy. They are starting to charge the host the service fee. So basically Airbnb is doing the exactly same thing that other OTAS like booking or expedia are doing.  I disagree with this policy for the simple reason that they DO NOT offer in their platform the same flexibility and tools that other platform offer for professional host. The are not at that level. For example in booking you can do many rates according to occupancy. You can also change the minimum stay according to the occupancy.  So for example you can rent the apartment for 1 day with maximum occupancy of 4 or you can set a minimum stay of 3 night for just 1-2 people. There are really a lots of tools that those platform offers and I think that Airbnb it is not there yet.

Airbnb is my favorite since it really cares about host but i have the feeling that now will be exactly as the others.

[Elaine701]

@Noemi20 

I found booking.com to be the worst platform for hosts maintaining high standards, since it's all instant book and you're obliged to accept any booking. Very dangerous for those maintaining high standards. But for corporate cattle movers, it's a good platform. Move 'em in, move 'em out. I suppose booking would be good for that. 

Yet Airbnb has all the things you list. You just have to take the time to set it up. What they don't have is the ability to change your pricing model from "flat rate for entire property", to "per person per night" on a seasonal basis. In our case, it's an important feature, because in the high season, we can be assured of being booked full at the top rate for up to 8 pax. In the low, season, however, the sweet spot is 2-5 pax, and pricing it for 8 would price it out of the market. So, we price it per person per night in the low season. We can't do it directly, so we have two listings. And it keeps us booked. 

Having said that, we used to be on booking.com, but never received a booking. We cancelled that. VRBO nets us maybe 2 bookings per year. Airbnb and one boutique platform keep us booked almost continuously year round, so much so, that the others just don't stand a chance. Airbnb's reach runs circles around the others in that respect. 

So, yes, there's plenty of things about Airbnb that are "unprofessional", but the one thing that I think "professionals" might be wise to consider is that Airbnb currently owns the game in STRs. That may change at some point, but for now, ignoring that could be rather "unprofessional".

Oh, and by the way, Airbnb quite famously doesn't care much about hosts, and their support of them is consistently bad. It's guests that are favoured. Just like any other platform. It's the nature of the beast. 

[Noemi20]

My experience is totally different. In other platform you have professional tools to make your market strategy. You can change your selling conditions (in airbnb they are set and recently in Italy they changed for worst), you have tools in case you manage different properties (while in arbnb is one by one) and I could mention others. The point to me is that Airbnb has been always unique. A boutique platform where host felt protected and safe to rent their properties. where the service prices were shared. Now they are following the nature of the beast. And they will be exactly as the others. There will be not the sense of community and sharing that make airbnb so special. It will be people in and out like in other impersonal OTAs. As Host I feel that now airbnb has lost its identity

[Elaine701]

@Noemi20 

You're a "professional" and you're just now realising this? 

And there seems to be a bit of cognitive dissonance here. On one hand you seem to favour the impersonal booking machine approach, yet then criticise Airbnb for becoming it. 

(?) 

I have plenty of criticism for Airbnb. But I'm also realistic. 

[Noemi20]

I prefer Airbnb to other platforms too for its "sense of community". In Airbnb people share experiences, houses and people usually have a different approach toward the host. The relation with the guests it is definitely different compared to other platforms. In other words in Airbnb guest are not customers.

Saying that if Airbnb want make a change and they want to charge the 15% commission as the others platforms they need to offers more professional tools.

Booking.com make you pay the 15% but their management tools are designed for professionals. This ensures that you can manage many properties at the time, that you can have selling strategy and so on.

Sorry but i really believe that Airbnb need to better define if they want to be Commercial Platforms or Community oriented Platform

[Sarah977]

@Noemi20  At least Airbnb still has the option of requiring guests to send Booking Requests instead of forcing hosts to use Instant Book. That's quite important to me.

[Emiel1]

@Noemi20 

Useally you can choose (unless using external software to manage the listings) which service structure you want to use, it is in your account, section payments, tab service fees.

https://www.airbnb.com/help/article/1857/airbnb-service-fees

With professional tools activated you can manage multiple listings easily and with the rule sets you can set a lot of special requirements.

https://www.airbnb.com/help/article/2499/using-professional-hosting-tools

[Mike-And-Jane0]

@Noemi20 The two fee structures are within 0.5% of each other in terms of total cost to the guest. As such the new fee structure is generally irrelevant to both host and guest.

[Elaine701]

@Noemi20 @Mike-And-Jane0 

We changed to the new fee structure because...

A) it's more consistent with other platforms, facilitating the presented price to be similar to how it's shown on the other platforms, who complain that our price on Airbnb is lower than on their platform. Previously, our listing on Airbnb was presented with a 15% lower price than the others, although only when the guest actually sets their dates and number of persons is the actual total price revealed with guest paid commissions, it turns out to be similar or higher than our listings other platforms. 

B) When the guest sees that there is no commission, then it's often perceived to be a better value. Even though the end price is actually the same (or slightly higher, in our case). 

[Mike-And-Jane0]

@Elaine701 The only thing some hosts should worry about is that the new fee structure might put them into a revenue bracket where they have to register for VAT (in the UK) and possibly in other countries. We are not in that league however!

[Elaine701]

@Mike-And-Jane0 

Technically, there is no significant additional income (here, "income" Is defined as the amount you actually receive, not the amount paid by the guest). Unless you've raised your prices beyond the 15% commission you'll now pay instead of 3%. We did indeed raise prices slightly above that in the process, but not double or something.

Inexplicably, we're already booked for the spring and summer at the higher price. But apparently there's a substantial surge in bookings for STRs in Mallorca (people apparently avoiding hotels due to covid) so that may help explain it. 

But we also have no "VAT threshold". It's not required to collect or pay VAT on these earnings, as they are declared as income. But we pay 19% tax on that! Luckily, we can deduct virtually all expenses. In the low season, we pay very little tax. The high season is a different kettle though. 

Still, I'm not sure how it would increase your VAT threshold, unless you're actually making more income. 

(?) 

[Mike-And-Jane0]

@Elaine701 I don't think you are right for the UK. Under UK HMRC rules you have to declare the gross payment and then expense the Airbnb service fees that the host pays. Under the old system the gross revenue would be roughly 103 for every 100 actually received. Under the alternate system its 115 for every 100 received.

The VAT threshold is 85000 so if you previously had revenues of 80000 then the new structure would force you to charge 20% VAT on all bookings (effectively reducing your income by 20% as guests would not accept a 20% increase).

[Lee353]

I haven't heard anything about this.  How do hosts know if they are impacted by this?

[Mike-And-Jane0]

@Lee353 you have a choice of fee structure unless you are 'software connected' in which case you have to be on the host only structure.

[Lee353]

Is this everywhere or just in Europe?  I can't find anything about this.