pricing

Answered!
Rozalyn0
Level 2
Bristol, United Kingdom

pricing

I am so confused about the pricing system. I thought air b n b added their cut onto the listing. i am now finding that they have taken their cut from my base price! So I charge 28pounds they pay me 26.99! So what do i actually charge?!! I need to get paid 28.00

1 Best Answer
Sarah977
Level 10
Sayulita, Mexico

@Rozalyn0  Airbnb adds their guest fee on top of your base price when guests book, but their host fee comes out of your base price. The host fee is approximately 3%, so raise your prices accordingly so you end up with 28 pounds.

View Best Answer in original post

25 Replies 25
Sarah977
Level 10
Sayulita, Mexico

@Rozalyn0  Airbnb adds their guest fee on top of your base price when guests book, but their host fee comes out of your base price. The host fee is approximately 3%, so raise your prices accordingly so you end up with 28 pounds.

Rozalyn0
Level 2
Bristol, United Kingdom

thank you they don't tell you that do they?! cheeky

Emiel1
Level 10
Leeuwarden, The Netherlands

@Rozalyn0,

The host service fee is 3% + VAT. Which is the exact difference. It is clearly mentioned in the reservation, there is also a VAT invoice in the list of reservations. And the HELP also explains it clearly:

https://www.airbnb.com/help/article/1857/what-is-the-airbnb-service-fee

Hope this helps,

Emiel

Rozalyn0
Level 2
Bristol, United Kingdom

Hello, thanks for your reply. I get the service fee but at what point is it added? I put up a price of 28 pounds and was paid 26.99 I thought air b n b added their 3% to the listing automatically . So does that mean I have to add 3% myself to my listed price? Thanks

The host fee is not added, it is subtracted from your base price. So if you want to end up with 28 pounds, raise your base price to 30 or 31.

Emilia42
Level 10
Orono, ME

The host service fee covers the 3% that it would typically cost to process a credit card transaction. This is standard practice. If you were processing the guest’s credit card by your own means the credit card company would be deducting 3%+/- from your profits as well. 

@Rozalyn0

Like others have said, guest service fee is added on to what you charge (because this is what the guest pays) but HOST service is charged to the host, so it is taken out from the host payment, not added on for the guest to pay. 

 

Host service fees

The host service fee for homes is generally 3%, but may be higher for hosts in Italy or hosts who have a Super Strict cancellation policy. This fee is calculated from the booking subtotal (the nightly rate plus cleaning fee and additional guest fee, if applicable, but excluding Airbnb fees and taxes) and is automatically deducted from the payout to the host.

Thank you for your help I think i'm getting it now! So much to read! x

R0
Level 3
Dubai, United Arab Emirates

Some facts on pricing.

Airbnb is not is only paying vat/tax for hosts, income component, it is only paying tax and vat for Airbnbs income component  to the government,  so if they does not pay vat component which the host is liable to pay to govt, then this is responsibility of the host to pay this.  Airbnb does not currently provide option to hosts within the airbnb portal to charge the vat/ Tax charge to the guests. 

Also I dont understand why Airbnb are forcing hosts to charge cleaning charges on a per reservation basis , why hosts cannot charge cleaning charges on a per night basis.  This in my view is not flexible, we pay to our cleaners for daily cleaning and we cannot recover these charges.

Also I dont understand why Airbnb are forcing hosts to charge management fee charges on a per reservation basis , why host cannot charge management on a per night basis.This in my view is not flexible. 

I dont understand why Airbnb are forcing hosts to charge community fee charges on a per reservation basis , why hosts cannot charge community charges on a per night basis.

Airbnb is always making life of airbnb host difficult by not giving freedom to decide the way he wants to charges,  the current pricing model is not good and does not have options for hosts to pass his costs to the guests.

Why dont Airbnb just add a per night fee for airbnb and let the airbnb host decide what he wants to charge for local taxes, cleaning and everything else. 

No model can be sustainable when airbnb wants to charge 3% to hosts and 12% to guests. If airbnb charges 15% without taking care of host expenses. Particularly when not all markets are profitable, not all locations are proftable, not all hosts are making money. Airbnb is only making life more difficult for those hosts who are already making losses.


Perhaps Airbnb  should charge every property based on the business and traffic, if a host is always 100% booked Airbnb  ought to charge 15% service fee for such properties,  but if there is less average bookings then Airbnb must charge less service fee. The Airbnb Service fee table charge table could be like below sample.

A property that is always,
100% booked - total service tax 15% possible, Host pays 5%, guest pays 5%, location fee charged to profitable locations only - 5% else it will be 0%

A property that is always,
80-99% booked - total service tax 13% possible, Host pays 3 %, guest pays 5%, location fee charged to profitable locations only - 5% else it will be 0%


A property that is always,
60-79% booked - total service tax 11%, Host pays 1%, guest pays 10%, location fee charged to profitable locations only - 5% else it will be 0%


A property that is always,
40-59% booked - total service tax 9%, Host pays 0%, guest pays 9%, location fee charged to profitable locations only - 5% else it will be 0%


A property that is always,
20-39% booked - total service tax 7%, Host pays 0%, guest pays 7%, location fee charged to profitable locations only - 5% else it will be 0%, location fee charged to profitable locations only - 5% else it will be 0%


A property that is always,
10-19% booked - total service tax 4%, Host pays 0%, guest pays 4%, location fee charged to profitable locations only - 5% else it will be 0%


A property that is always,
0-9% booked - total service tax 1%, Host pays 0%, guest pays 1%, location fee charged to profitable locations only - 5% else it will be 0%


So you need to helping new hosts and hosts who are less profitable to help grow the community, and thus airbnb should only charging service fee or making money only in profitable locations and to profitable properties.


Also hosts have other expenses like, how can airbnb not allow hosts to recover these costs, on a daily basis. This cannot be per reservation basis. Also how can airbnb charge service fee on our expenses, currently these fees get added to room charges.


Room rate/ Property Rate - Room rate/ Property rental/ Bank monthly interest

Utilities Fee - Electric bill/ Internet bill

Community Fee - Community cooling/ District cooling/ Air-conditioning and heating bills.

Cleaning - Daily/ monthly cleaning bills

Miscellaneous costs Shampoo/ Soaps/Breakages&Repairs / insurance

Profit/ Management fee - Host is giving his time/ he should be entitled to some fee for this time.

Local vat / local taxes come in two variations, % and fixed costs. We need to have two type of taxes

variable tax - 5% of bill to adjust vat

fixed tax - per night $20 to adjust fixed taxes to govt, which the guest should pay to host. There cannot be service airbnb charge on this.


So hosts should be allowed to charge, like below example

Room rate/ Property Rate - $100 per night
Utilities Fee - Electric bill/ Internet bill - $25 per night
Community Fee - Community cooling/ District cooling/ Air-conditioning and heating bills. - $25 per night
Cleaning - Daily/ monthly cleaning bills - $10 per night
Miscellaneous costs Shampoo/ Soaps/Insurance - $10
Profit/ Management fee - Host is giving his time/ he should be entitled to some fee for this time. $20
variable tax - 5% per night vat
fixed tax - $20 per night


The guest should pay for all this breakup to host so he can evalaute all cost breakups. There shouldnot be service airbnb service charge on everything. Service charge can only be on profit or room rate bit not on costs of the hosts. like there cannot be service tax on govt tax and cleaning and miscellaneous costs , utility and community costs/ bills

So based on above example service tax can only be on the below components. not all other components, as they are costs of the host.

Room rate/ Property Rate - $100 per night
Profit/ Management fee - Host is giving his time/ he should be entitled to some fee for this time. $20

For long term sustainablilty of business Airbnb  need to take a hit to allow sustainability for hosts. Any business that makes 15% as brokerage which is what airbnb is charging is not sustainable. 

Even the 15% charged by airbnb to guests and hosts is too expensive and not conducive to any workable model. Airbnb is literally killing those who are already making losses.  The home rental business model was meant to give cheap home solutions/ alternatives to hotels, currently hotels are less expensive despite their overheads due to high service charge by airbnb.

.

Very interesting suggestions.

 

Gener13
Level 1
Manila, Philippines

I love this 😊. Airbnb should hire you😊.

Ruth406
Level 2
Clovis, CA

I was wondering if anyone reduces their price when Airbnb suggests that.  There was a message stating that listings were down by 17% in my area and that I should consider lowering my price.  I feel what I charge for what my guests receive is extremely fair.  Does anyone else do that?  I decided I will not reduce my price, just curious if any of you do.

@Ruth406  There are tons of threads and posts on this on this forum. Type "price tips" into the search engine.

 

Experienced hosts ignore those price tips. They're absurd, innaccurate, and half the time they're comparing apples and oranges. 

Wesley73
Level 1
York, United Kingdom

Can I use two different prices for midweek bookings and weekend bookings without using the smart pricing system if so how do I do it? 

 

Thank you 

 

Wesley