Fees and hidden charges are becoming an issue

[Brooke291]

Ive been quiet on this issue, until now. I’ve had it up to my eyeballs with these fees.
I’ve been using Air B n B for years now. I’ve stayed in places from Skagen in Denmark, to a Church in Yakima, Washington, to a Sea Divers shop in Crescent City, California and a few more. I’m pretty seasoned in the ways of Air b n b, and I’ve even turned my friends on to this site, I love it so much! 

I’ve enjoyed every property, and the hosts have been absolutely wonderful!
But I’m very concerned and a little disappointed with what Air B n B is turning into, with regards to letting property management companies tack on fees, and increasing their own fees.

I understand that hosts may charge what they see fit, but these fees are getting ridiculous!!   Mostly, it’s the fact that the advertised price NEVER reflects the actual out of pocket cost by quite a lot.

This is infuriating to folks who are trying to help out the little guy by renting their places, but are being forced to find other places because of the sticker shock.

I’d much rather give my money to a neighbor than to big business.

In the beginning, I thought it was a spectacular deal, especially in Europe where hotels aren’t very cheap. 
But lately I’ve noticed hidden or ‘non advertised’  fees are taking up to, or greater than, the original amount posted per night. 

For example, my stay in Denmark was $100 a night for 7 nights, after the cleaning fee, a service fee, taxes, and in the fine print an ‘electricity and water use fee’ which means I’ll also be charged for the utilities AFTER my trip. 
$700 turned into $1300. This was in the fine print, hidden in pages of rules from a property management company that was renting out homes for the owners. Why are they not required to state upfront that there’s additional fees?? Why do I have to find out a month later when the bill comes due? I could’ve stayed at a decent hotel for less. 
That defeats the purpose of why this site was started. 

Now I’m booking in Wyoming for 2 nights, at the advertised $150 a night, which is $300 total. 
With a $50 cleaning fee, a $50 service fee, and an ‘occupancy tax’ of $50, the ACTUAL price is $450!! That’s like an automatic 50% added on! 
50%!! WTH Air B n B?? 
How did we get from $300 to $450??? 

This is very deceiving, and fraudulent  (I’m no expert). I want to be clear, I have no issue with what the hosts want to charge. What I have issue with is that the advertised price should reflect the total amount. 

So guess what? Sadly,  I ended up going to Booking and booked a cabin with AC, a kitchenette, private bath, WiFi, and all the goodies, I was looking for at a hotel for $95 a night. And guess what? The final cost was...

$95 a night. 
Please clean this mess up soon! The hidden fees, the management companies, the advertised prices. I would really hate for this great idea of homeowners renting their places, to price itself out of business. 

[Lisa723]

@Michelle53 I see, no, I was referring to the Airbnb fees that professional hosts can use-- these are the fees I meant I was not sure were included, in my first post. Not fees described in listing text, which obviously cannot be included in Airbnb's search results.

(And the fees available to "professional hosts" still do not include a pet fee.)

[John5097]

@Lisa723

If guest check specific dates it does show a total price. Although it appears to not include the accommodations tax, as you mentioned.  

I selected a random listing: 

This is the first time I've heard of the other fees added water and electric fees. 

The OP was upset at the amount of $150 as 50% increase with fees in the cost, at least the way I read it, so I don't think that will change and will only increase as local taxes increase. 

(BTW, I updated my listing to show exact breakdown of fees to hopefully avoid being marked down. I haven't had a single complaint but have read recent article about upcoming pricing overhaul and now reading comments.)

[Christine615]

I'm a host who also rents Airbnb's as a guest. So let me help explain what is going on. Even I avoid Airbnb's with excessive cleaning fees. I understand why they exist which I'll explain later, but I think it should be baked into the price. I remember when I started selling things I didn't need anymore on eBay. Back then eBay charged 10% service fee on the price of the item. So businesses started scamming the system by selling something for a few dollars with a $199 mailing cost. So now eBay affixes the fee to the total cost including shipping. Which caused rates to go up. They got tired of people gaming the system.

So about Airbnb.

1. I think the total cost (including taxes and fees) should be shown to the guest before they book. Not just when they select "book" but when they are searching for properties so you can compare apples to oranges. I can see properties in my area that are, say, $100 a night. But one charges $50 cleaning fee and the other charges $150 cleaning fee. So the true cost for one night is $150 or one and $250 for the other.

2. Cleaning fees are "one time" so the longer you stay, the lower the cost per day.

3. Airbnb suggested we pay cleaners $25/hour. I'm not sure who came up with that rate as it is three times the minimum wage. But I do understand that $25 has to cover the person's taxes, social security, cost of gas, cost of supplies if they are self-employed.  It takes 4 hours to clean and sanitize my 1500 sq foot apartment. I have nine rooms including three bedrooms. That means the cleaning fee would have to be $100 on average (more if the guests are a disaster). I could put that in my price but on the search engine I would look more expensive than my peers claiming their phony $78 night/fees.  Instead, I split the cost with the guest and charge $50.

4. I don't know if you regularly stay in hotels but I do. The rate can be $100 a night but cities often charge a sales tax and a tourism tax that can raise the price as much as 15%. Their cleaning fees are built in to the cost but in those cases you are only renting a single room not a whole house.  That tax is not optional. Cities require it be paid. In some cities the hosts also have to pay for a business license and pay taxes on the income you are generating when you rent.

5. The service fee is the price you pay directly to Airbnb in order to use its platform. That's how they make the money needed to pay their staff and pay for marketing. Hosts don't see a dime of that money. We only see the nightly rental fee and the cleaning fee. 3-4% is deducted from the money you owe us to pay for processing your credit card. I have a Square I use to take payments at book festivals. Square charges the same fee for every transaction. I was recently at an auction and had to pay a 4% fee to compensate for what would be deducted by their Square account. That's how credit card companies make money on the front end.

So here's the deal. Airbnb's are getting more expensive because for every good guest we get, we get others who are slobs that assume we have cleaners ready to spend 24 hours in a Hazmat suit to reset the apartment, and that we have unlimited budgets to replace the stolen and broken items. They assume we're absentee investors when they leave ink stains on my down-filled couch and hand prints on the silk curtains. They want a great place to hang out and relax but they don't always respect our belongs. A recent new host was shocked that when I checked out his apartment was cleaned, the beds were stripped and I had put the towels in the washer. You'll note all the hosts I've stayed with say that because that's not been the norm.

Yes - I think the prices should include the cleaning fee. But for everyone of us who does that, we'll be competing with the ones who use the eBay model by advertising a cheap price and hiding the real profit in the cleaning fees of $200 or more.

Airbnb shows you the price before you finalize the booking. You have a choice.

By the way - if you think Airbnb hosts are cheating you - please go to a hotel. It's not helpful or wanted to have someone book us with the attitude that they are helping the "little guy" instead of a big business but only want to pay us a rate that won't even help with the cost of the cable TV bill.

Let us know your opinion of - say - the New York hotel I booked at Times Square that charged the NY sales tax, the tourism tax and a "resort fee" that covered the cost of internet, etc. but no meals. My $99/night bill turned into $150/night.

Welcome to traveling. I'd like guests to think of us as a home away from home, not a low budget alternative to a hotel.

But that's just my personal opinion.

[Michelle53]

@Christine615   I've been thinking about room rates.

I've been listed on the platform since 2015. In that time, my rates haven't really changed much.  

In the meantime, I've added a lot of amenities, and little things that make a guest's stay more comfortable, and just absorbed that as the cost of doing business, and the price of good ratings. 

I get great "value" ratings, for the most part. 

Guests get a lot - free electricity, free hot water, free supplies,  comfortable, clean beds. Too many things to list. But guests always mention the thoughtful extra amenities. 

But, in spite of everything folks get, someone always wants blazingly fast wifi free, on top of all that.  

Gone are the days when people appreciated a pull-out sofa and a blanket, for a great price. 

So Amazon Prime had a great deal on a mesh wifi system, and I decided to get it. So my only consideration now is whether I have to eat that cost, yet again, or make an adjustment to my room rate, also taking into account the new annual $125 registration fee I'll have to pay the city. 

We shall see.

[Christine615]

I'm getting ready to dump cable which has become astronomical. Rumor is that our cable company will provide mesh equipment if I do. But I've started building the expenses into my room rate. I kept adding amenities and snacks and when I did taxes I was a bit shocked at how much it added up. Our licensing fee was over $200.

The way I fixed it was to raise my base rate $25 and reduce the headcount to 2 people. I charge $25/person extra per night for each additional person (still less expensive than a hotel room). Kept my cleaning fee really modest. The base rate made it reasonable for couples to stay (with less wear and tear) and still be reasonable for families and friend groups.

I'm finding a lot of people still think we are air mattresses on the floor and despite the photos of our listings still want us to price as if we were.

[Dave52]

Just look at the $ total (don't fixate on $ / night) and you'll be fine.

[John5097]

Ok so just wondering what the solution would be?

The only time guest don't see the total price (not including local taxes) is if they don't use any dates. 

So guest only see the nightly rate for one night. Lets say its $100 

If the cleaning fee is added, say $50. So now $150 for one night. 

If the service fee is added its a 14% so now $164.. however that will go up when more nights are added.

Same with local taxes.. its 14% so now at $178 total price for one night for $100 base rate when guest search without adding dates. 

It also wouldn't include any discounts such as week or month long stay or booking early, or the fact many have two night minimum stay. 

For a four night stay it would be: 

$400 + $56 (14% service fee) + $56 (14% local tax) + $50 (cleaning fee) =  $562 total 

For one night it would show  

$100 

($178  total) 

Guest would have no way of knowing service and taxes are a percentage and cleaning fee stays the same no matter how many nights they stay. 

Or have it itemized  

$100 per night 

$14 (service fee %14) 

$14 (taxes 14%)

$50 (cleaning fee per trip)

Total = $178  

But that takes up a lot of space so not as many listing will be in the first search and still be confusing. 

The reality is that local taxes will keep increasing. For host there is no other option, they have to pay taxes, Airbnb service fee, and cover cleaning cost. 

Airbnb also encourages host to pay a living wage to cleaners. 

Is the the only option to put a cap on cleaning fees, such as 10%? or just have it included in the price? 

Even then some guest will complain when the service fee and taxes increase with each night added in final total. 

[John5097]

Meant add, guest can sign up for special offers for new listings that offer a discount, and usually lower rates to get started. 

Guest would need to get lucky to find lower rates on any booking platform, and that would have higher risk. Realestate has also gone up that will mean higher rates for new listings. 

Hopefully Airbnb won't make it seem like the host is the bad guy and subject us to more revenge reviews or hostility, when most guest don't even bother to read the listing, or expect things that are unrealistic. 

[Susan990]

I appreciate your post and the subject is ripe for discussion because Airbnb  has already signaled changes in fees charged to Hosts is slated for upgrades~ see BC 's  Community Center  announcement 2020 where in he states how many millions Hosts globally have" taken in"  then states " and the vast majority of that money is retained by Hosts".  Well, hope to shout YES the majority of the $$$  belongs to Hosts. It is our property and Airbnb is only a booking agency with a  service platform.

  By 'majority' he means Airbnb collects a 3% service fee and the other platforms charge more. Airbnb wants  MORE.

  Of course to get more you need  to give more.  The low bar of customer service and  standards of practice  which Airbnb currently offers,  accompanied by  absence of  professional  training displayed  across the platform ~ most importantly in STR Rating Review system ( only Airbnb rejects the universally accepted format )choosing instead its own amateurishly  concocted  invasive  ratings questionnaire format . That sector alone probably accounts for 90% of the source of all problems and disputes  between  Guest & Host. 

   If any reader of this post think I am off base in these comments and/or my conclusions I would appreciate your input and insight.  I only want what is best for the Airbnb community and a bright and successful future for use all.

[Jenny1388]

@Brooke291  you are so right about this. As a host , I totally understand and don't get why airbnb tags on all these extra fees. I don't charge a lot for cleaning because I do it myself. I feel like no one  can ensure that my place is cleaned and sanitized to my satisfaction,  especially in the world of covid so for airbnb to allow for the extra fees And tag thie town fees on top is unacceptable.  I charge fairly low price  the rooms I rent and I hate when guest have to pay so much. I actually screen shot the payment I was receiving to one of my guest which was totally different from what they were been asked to pay.  So unfair! 

[Christine615]

I'm still wondering why people keep saying Airbnb tacks on all the fees. The host charges a rate for lodging and one for cleaning because the system makes it impossible to include it in the fee without seeming more expensive than the other lodgings that include it separately. Many people use outside cleaners. I don't - I just pay for help with laundry and clean myself. It still takes 4 hours.

The two other fees (visible when I look at the guest account) is the tax the government requires them to collect (same ones a hotel collects) and the Airbnb service fee.

You will pay one way or the other. I booked a hotel on Expedia and the host asked me why? I said I had an account and it was easy to search. He went on to say that a lot of smaller hotels are franchises and Expedia takes a cut of the proceeds. That was invisible to me but I can see how it would be baked into the price so the hotel can turn a profit and pay its staff.

What Airbnb SHOULD do is calculate the total cost including local taxes and show the guest the entire price (all inclusive) when they put their guests and dates into the search engine. Then they can distinguish between similar properties were one might charge $150 and the other is $225 due to differences in cleaning fees (which may also raise the Airbnb fee).

[Kristina46]

We have to collect transient accommodations  tax in Hawaii. Together with excise tax, it amounts to almost 15 percent. Perhaps you didn’t understand that in the States we don’t have VAT like Europe but we are required to collect state and local taxes on bookings. 

[Susan990]

Actually that is not correct.  Airbnb does collect all taxes due  and disburses them for you if you Do Not click the Add Tax box in your To Do on Edit page.

 It seems counter intuitive and it intentionally is so, in my opinion. I never touch that button and by law Airbnb must collect and disburse all taxes assessed by the state and city or county with taxing authority.

[Lisa723]

@Susan990 

"by law Airbnb must collect and disburse all taxes assessed by the state and city or county with taxing authority."

What is your source for this assertion?

Airbnb does not collect collect or remit lodging taxes for Clackamas County, Oregon. There is also a state sales tax that they do not collect or remit for my listings in Washington. I think this is true for many localities; you have to check with your local tax authority.

[Susan990]

We are struggling over semantics here.  Airbnb has had to agree to collect any transient lodging tax and or nightly lodging tax/ short term rental taxes where ever they are posting listings in that taxing district. The issue comes down to who collects them- the host or the booking agency ( which acts as the escrow holding company for all funds in the transaction).

Therefor, the programing has adapted itself automatically uploading this taxing information onto its platform.  You can check out your state and local to be shown the taxes which apply to your listing. Every state has its own taxing system plus cities and counties have their own as well.

  With this information on the platform the next issue is who collects and disburses.  Airbnb has it all set to do this duty~ but recently came out with this new To Do column which I discussed and by clicking it you are saying that you, the host, will take responsibility for this duty and send the money yourself.

  I personally am horror struck at the very idea and am so happy Airbnb has taken this on in their services. This is what keeps municipalities happy to allow Airbnbs' into their communities~ it keeps the welcome matt out for our industry.