My wife and I are looking to rent out the completely separate and private lower floor of our home. We live in the very popular summer vacation area around Lake Geneva, WI which is Chicago's summer playground. In doing our due diligence we're getting some confusing numbers from AirDNA. We will have 2 bedrooms plus a pullout for a total of 6 beds and 1 bath. AirDNA's "Rentalizer" is suggesting an ADR of $320 and yet just down the road from us is a place ON THE WATER with 4 bedrooms, 2 baths, sleeps 10 with a private pier and an ADR of $279! I just can't fathom how their place would EVER get less than ours. While working on setting up our first listing on AirBnb they suggested an ADR of $113 which is obviously quite a bit lower than $320. Can somebody help me out here as to what is an accurate figure for us to work from and which service we can trust? Thanks in advance!
At the moment with Covid, it has lead to reduced bookings even in popular resorts with resulting reduction in pricing.
If you want to estimate pricing you are much better looking at what comparable listing in your chosen area are charging rather than what Airbnb and other third parties are suggesting @And62002
Thanks for the response but I thought this is precisely what services such as AirDNA were supposed to provide since they have all the data on every listing. I'm TRYING to look at comparable listings on both AirBNB and AirDNA and there just seems to be great variance in the numbers.
@And62002 ABB doesn't know what you should charge... many tend to think that their prices are always too low.
I don't know that I'd trust a service that has you to believe that they have "all" the pricing data either.
Furthermore, pricing can be quite variable based on maaaaaany factors: one of which being the property manager's goal. So, the place down the road from you may only be available on occasion and as such maybe they price high or maybe another one wants to be booked at all costs so sometimes they rent very low. The better exercise is to decide what it is worth to YOU and then price accordingly. Once you've rented for a while, then you'll know if you can get even more than your minimum. Or not.
There just really isn't a shortcut, and every year, every guest is different. But to the previous advice, its a good idea to know what is allowed (city, HOA, ABB...) and then also what seems popular (look at nearby listings and their reviews) and then finally, what could go wrong (spend a few days reading here, ask your insurance agent what would happen in a worst-case scenario).
@And62002 We find the data at alltherooms.com to be fantastic and very useful. It allows you to track your local competition and get real stats and relevant numbers. Very affordable subscription and worth taking a look at. They are also very responsive to clients.
@And62002 I have tried many of these services and they just don't seem to work.
I started using Airbnb filters/maps and search beds, bathrooms, and kitchens in my area (pool if you have it) not filling in dates. I do this on my phone and use excel on my computer to quickly populate weekday and weekend pricing of the nearest 30 comparable properties to me. When I started I priced a bit lower (10%) than the average to get bookings. Over time I have raised my price to be the premium in the area. I also increase the price for special events and holidays using the same methodology.
If the property is not booked 10 days out I start to lower the price to encourage booking and keep the calendar full.
To start I would only allow bookings 3 months out and block up the rest of the calendar until you find your happy spot for pricing. I made this mistake when I started. I booked up a popular holiday 8 months in advance for an extremely low price.
The outcome of a human looking at the comparables vs an AI program is way more accurate and you will be more engaged in your pricing, fill your calendar and it is free of charge. The other benefit of doing market research this way is learning what the competition is doing and ways to improve your property and reviews.
@And62002 You've gotten great advice from @Kelly149 - "The better exercise is to decide what it is worth to YOU and then price accordingly." I used Airdna briefly but ultimately didn't find it super useful, as it only had data on 11 properties near me.
When I started in coastal Maine I was shocked at everyone else's low nightly prices. I priced mine at what I believed to be their value and guess what? Within two years everyone else's prices had gone up. I don't believe they were running any kind of operating figures before they chose their prices initially. So ignore the competition and ignore Airbnb's suggested minimums. I'm on the side of using SmartPricing, but only if the minimum is set at YOUR price. You can always override SmartPricing and price manually, but a listing that uses Airbnb's tools will do better in search.
@Angelica-Y-Jorge0 I would love to know how you can quickly populate an Excel spreadsheet from an Airbnb search!
@Helen3 Quite the contrary - bookings have gone through the roof in US resort and vacation areas where people can have the place to themselves.
@And62002 I also tried it and did not find it accurate or useful. I think much of it depends on your market: if you're hosting in a metropolitan area where there are a lot of listings that are similar to yours (like hosting a condo apartment in Toronto, for example) it's going to be way more accurate than if you host a vintage farmhouse in the sticks. I went back to doing my own pricing almost immediately each time I've tried one of these services out. You can always try it, see what you think, and stop if you're not happy.