Guest Fee waived but HOSTS now automatically charged 15% commission by Airbnb

[Melanie818]

Email received from Airbnb September 2nd 2020

Starting 11/1/2020, we’ll be switching your listings to simplified pricing—a new service fee structure that gives you more control of your final price.

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 11/1/2020, 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 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 11/01/2020 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. Here’s a summary of what will change:

• Your service fee settings will automatically change on 11/1/2020 for all your listings
• We’ll deduct a flat 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 11/1/2020
• Using Airbnb after 11/01/2020 means that you’ve accepted this new service fee structure

[Robin4]

@Melanie818 

This is being progressively rolled out. For some time now new multiple listing hosts with more than 10 properties have automatically been put on the 'host only fee' scheme, but research with the guest community last year suggested the main stumbling block for guests is that service fee hit they get on the check-out page, and they are more responsive to booking if they feel they are not paying a service fee.

Nothing comes for for nothing in this world,  unless its in the minds of the people who run Airbnb.

The company fully expect that the hosting community will except this extra 12% hit to their revenue on the premise that it will improve the number of bookings hosts will get....so, in theory, they will be no worse off!

It is simply another version of 'Pricing tips' .....but one that makes Airbnb look good in the eyes of the guest while at the same time, once again, uses their hosts as 'canon fodder'!

Of course hosts will be worse off having to give away another 12% and transfer it straight into Airbnb's coffers while the guest says...."Thank you very much"!

The shared economy is a concept that disappeared from Airbnb's philosophy some years ago!

Although Airbnb sets a changeover date saying it will not affect existing reservations, experience with some I have spoken to in the Plus community has shown that it has affected all payouts regardless of whether they were booked before the changeover date or after.

The host, as we have come to expect, is once again the loser here!

If this transition in company service fees (putting the onus of responsibility for running the company entirely on the host) is offered to you, do not agree to Airbnb's preferred option! Immediately lift your listing amount by 12% to offset the hit you are going to take to your earnings! 

Airbnb are not going to suddenly miraculously find another 24% of guests for you to make up for the loss, but they will expect you to do what you do for 12% less!

Don't get sucked in!

Cheers.......Rob

[Super47]

@Melanie818 @Robin4 

This has already been rolled out in Thailand in August, and Greece and Croatia from Sept 1st. Early adopters were offered the 14% fee (16% for Super Strict), rising to 15% for those who opt in

later. Global rollout expected to follow. 

However, it previously appeared that this  new fee structure applies only to software connected hosts/professional PMs.

@Melanie818

Do you use a channel manager to connect to Airbnb, by any chance?

 

[Super47]

 

[Robin4]

@Super47 

Your screenshot must be quite recent, the hosts I talked to said Airbnb made no mention of hosts adjusting their prices, just simply that it would improve their number of bookings and did actually apply it to previous payouts!

Cheers.......Rob

[Super47]

Hi @Robin4

Yes it is quite recent, and also mentions "Use your channel management software to check prices on all platforms you use", so would seem only to apply to API connected hosts.

This latest push would appear to be (at least in part) due to pricing for the same properties very often showing quite a bit higher on Airbnb than on the other platforms. Some PMs have mentioned that their Airbnb account managers have been contacting them to inform them that it's been noticed that their pricing is lower on other OTAs, and asking them if that's "an oversight". The truth is though, many hosts (big and small) deliberately keep their pricing much higher on Airbnb than on other platforms now, to offset all the extra losses that are regularly incurred on Airbnb, such as unpaid damages, unwarranted refunds, unexplained clawbacks etc.

While most do still choose to advertise on Airbnb due to it still having a large (but diminishing, in many regions) share of the market, their strategy is to price significantly lower on the other platforms, in order to attract more of their bookings through those instead. Guests are fully aware that the vast majority of hosts advertise across all the major platforms nowadays, and if they see a place they like on one site, they'll generally shop around to see if they can find it at a lower price on the other OTAs (or the host's own website)

Airbnb have clearly become very aware of this in recent times, and are desperately attempting to stem the flow. Perhaps they should have thought of the inevitable consequences before their shoddy service and abysmal treatment of hosts obliterated their loyalty and drove them to seek out other options. 

[Ute42]

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@Super47   

You wrote:

• The truth is though, many hosts (big and small) deliberately keep their pricing much higher on Airbnb than on other platforms now, to offset all the extra losses that are regularly incurred on Airbnb, such as unpaid damages, unwarranted refunds, unexplained clawbacks etc.

That's what I do. On airbnb I charge twice the price compared to other platforms.

My way of thinking is: If I host 2 airbnb stays at twice the price and I'm not getting payed for one of them, I still get the same money as if I hosted 2 stays on another platform. Makes sense, doesn't it?

You may now say but noone will pay such a high price, but that is not true.

First of all, my place has a couple of features other places don't have. No. 1 on that list is a 500 squarefeet barbeque cottage with a roof over it. You can do Your barbeque outside in the open, even if it's raining cats and dogs. Noone else has that.

The second thing is, my place sleeps 10. So if 10 guys with 10 seperate incomes book my place, they are splitting the costs among 10 people. These guys don't care if they pay 1000 or 2000 Euros for a weekend, it's just 100 or 200 Euro for each of them. So what?

So I'm implementing the possible losses when renting through airbnb into my pricing right from the start. This pricing policy works fine for me.

cc: @Robin4 @Ann72 

[Anonymous]

@Ute42 Guests are catching on!  A few times recently, I've found a place on Airbnb that I really wanted to book, but added in a few seconds of research to locate the property elsewhere online for about half the final price. 

[Susan1188]

@Anonymous  so it's a win-win, you got a cheaper price and the host pushed you to the platform where he has better service and conditions.  win all around!

[Robin4]

@Ute42 

Ute are you seriously trying to say you do not get paid for a percentage of your Airbnb hostings?

I have a lot of issues with Airbnb but getting paid isn't one of them. They have never stood me up for a cent that was owed.

I do put a few dollars on to my nightly rate but, only to cover breakages. I have never lodged a claim with the Resolution Centre and I never will. I consider that course of action counter productive and just leads to a lot of frustration. I just pull a bit of money out of the damage fund, put things right and get on with hosting! Most times I don't even embarrass the guest, I just put it down to the consequential reality of hosting!

For me, to end up with another $24,000 a year in the back pocket is great, it isn't going to make me rich but if I can consistently end up with about $70 net per hosting night, I am more than happy with that.

And I think that is where I am lucky Ute, I don't have lofty expectations, I just like the extra bit of pocket money I don't have to fight anyone for!

Cheers.......Rob

[Fred13]

I have a similar appreciative attitude @Robin4. Just to add to what you said - because of this whole arrangement with a booking agency that does bring us endless customers, I get to live where I want to in peace. 

[Ute42]

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@Robin4  

I didn't say that airbnb owes me money. But they may, in the future, deduct 50% from a payout bc the guest saw a 3mm size spider or they may not pay me at all bc the guests granny died (EC policy). I mean, this CC is full of such stories.

Right now I'm having the problem that I am not verified.

In Nov last year, right post Orinda, I got a notifcation from airbnb that I have to reverify myself. I was already verified. I tried everything to verify myself but nothing worked. There is a 15 page thread on this issue on the german CC:

https://community.withairbnb.com/t5/Gastgeber-unter-sich/Ich-mu%C3%9F-mich-verifizieren/m-p/1182242#...

In dec 2019 I booked a place for myself in Italy on airbnb, the reservation went through, payment went through, but 2 days later airbnb cancelled my reservation bc I'm not veryfied. Till today, 10 months later, I am not verified.

One of the problems in this verification process is, that airbnb says I don't live where I live. I gave them my adress and they say the adress is wrong. Well, the adress is right, I live in this dwelling and all my clothers are in there. Also I receive mail under this adress and my name is on the door. All that doesn't help me at all. They continue to say my adress is wrong.

I have no idea if they will pay me for future stays I'm selling through their platform. Maybe I'll get a notification:

• Ute, to continue to receive payments from airbnb, pls verify Yourself.

I've read repots from other CC members that that has happened to them. I will be hosting the next airbnb guests in 2 weeks from now and then see what happens.

[Robin4]

@Ute42 

Oh Ute, you are looking for 'skeletons in the closet' with regard to your payout concerns. 

Hey, you know as well as I Ute, you need to be a glass half full person in this life, not a glass half empty one. You can't keep on thinking that guest around the corner has come to rape and pillage!

If verification is a problem get an agent to send you a verification link that will enable them to walk you through it in real time! I did that, three years into hosting I got an email saying I was not verified! I used my Superhost status to quickly have an agent go through it with me and fix the issue that was stopping my verification for being accepted before.

Ute, we here are the tip of the iceberg but we are the sharp tip. Most of the posts that come here are from new users who have an issue.....something has happened either right or wrong which has injured them.  We don't hear from that 20,000 who had a great experience, just that 1 that didn't. 

All platforms have their strengths and their weaknesses, I just think that Airbnb has the best balance for me. That is why 90% of my hosting is done through Airbnb. I am not carrying a torch for them, the day they dud me, I have other hosting options.....but in 5 years they haven't duded me.

Don't look for problems where they may not exist Ute, concentrate on the real ones.

Cheers......Rob

[Ute42]

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@Robin4  

In reference to my verification problem You wrote to me upthread:

• If verification is a problem get an agent to send you a verification link that will enable them to walk you through it in real time!

This remark of Yours shows that You did not read the 15 page thread on the german community center I had linked for You. Pls go back there an read it.

Also You wrote:

• I have a lot of issues with Airbnb but getting paid isn't one of them.

On November 7th, 2018 though You were having substantial problems with airbnb payments. This triggered You to send out text messages to Your upcoming guests:

-----------

„Hello ………….. This is Rob your Airbnb host for your up-coming stay on…………. Due to an internal error within the Airbnb organisation, Australian hosts have not received hosting payouts since the end of October. As there has been no communication from Airbnb as to the cause or the expected rectification of this problem I have to inform you, your upcoming stay with us has been compromised to the point where we are not in a position to honour existing Airbnb reservations. I love my hosting and will always continue to provide the great experience that has got us where we are, but, we do need to be paid for the service we provide, we have costs that need to be covered.

I suggest at this point you cancel your existing Airbnb reservation and I will direct you to another hosting platform where the financial transaction will be more secure. I have a flexible cancellation policy which means you will be fully refunded for what I should have been paid by Airbnb and I will undertake to cover some of the loss of any service fees that Airbnb charged on your reservation.

I am sorry to have to bring this news to you but, the total lack of any help or information from Airbnb has forced us into this! Please attend to this urgently and I will help in any way I can. Cheers……Rob“

--------------

Everyone knows that we are on shaky grounds concerning airbnb payments. They can pay us late, deduct money from our payments or not pay us at all.

Why do You put makeup on that situation?

[Robin4]

@Ute42 

Ute, that instance you brought up did in fact happen, but Airbnb didn't single me out, every Australian host didn't receive any payouts from around the 25th October until the 15th November ......many thousands of unprocessed transactions. It panicked all of us because Airbnb seemed to indicate it was our fault.

It started with each and every one of us getting this email.......

This did seem strange because all our payout methods were in place and being honoured by our respective banks. Customer support did not know what was going on, half of them suggested it was a glitch and do nothing, the other half suggested we do as the email prompted and put in place another payout account preference!

Next thing this email arrived.....

So, okay, Airbnb did acknowledge there was an issue and they were working on it. Three weeks went by and we did not hear a thing! CX didn't know what on earth to suggest and Ute, we all panicked. I ghosted my listing across to another platform to cover myself.

If Airbnb had kept us in the loop, each day or two, sent us an email giving an explanation we all would have been okay but it was the total lack of any communication and any money that gave every host in Australia the jitters! They were not singling me out Ute, it was everyone in this country. That was when I prepared that letter you quoted above to send to my existing reservations. I thought, I will give them another week, that would then have been a month, I would give them no more latitude than that, then I will send that letter to every upcoming reservation.

A few days later the next email arrived........

We were all hopping mad by this point and didn't trust a thing Airbnb said. A couple of days after that, this arrived........

The situation resolved itself. I did not have to prove a thing to Airbnb, they acknowledged that the issue was theirs not mine. We to this day have not been given an explanation for what happened. I have my suspicions!

About the same time we all received that first payout problem email, we received another information email from Airbnb saying as of October 1st 2018 Airbnb were required to file share all their Australian hosts information with the Australian Taxation Office. My feeling is the computing system that controls the Australian arm of the business did not have the capacity to comply with the ATO's requirements and at the same time attend to general housekeeping. And for that reason all payouts were put into limbo until the ATO were satisfied.

That could be entirely wrong but, with the absence of any other explanation, it sounds feasible.

Ute, individually Airbnb have never duded me for a payout, they have never disputed a cent that I have been owed by them....... and that is what I was trying to get across!

Cheers........Rob