Flexible vs. Moderate Cancellation Policy?

[Dan144]

Hi Everyone,

I have used AirBnB as a traveller and generally I look for places that have a flexible cancellation policy, however I've now dived into the world of hosting and I'm wondering if I should stick with a flexible policy for my listing or if I should use moderate. I'm a bit torn because as a traveller I look for flexible cancellation so I understand the thought process behind it, but as a host I'm concerned about a guest booking a few weeks in advance blocking off my calendar and then possibly cancelling the day before check-in, which would mean no payment for me and most likely not enough time for someone else to book the room either.

I'd just like to get everyone's opinion and experience between the two cancellation policies. Do you notice any decrease in booking requests with a moderate cancellation policy? If your policy is flexible, do you get many people who cancel the day before so they get a full refund? Appreciate your sharing, thanks.

[Hannah104]

After a very frustrating experience I have recently altered my cancellation policy to strict. As a world traveller, I also initially wanted to have as flexible a cancellation policy as possible for my guests. However, several last minute cancellations prompted me to alter my settings to moderate. This brings me to today, a guest who stayed with us recently and booked far in advance when our policy was flexible, changed their reservation the day before their arrival due to an unspecified "family emergency". We know that things happen in life and accommodated their request. They returned a month later to stay with us for the second half of their booking only to again request to shorten their stay after having already checked in, as they had found another airbnb property just a mile down the road, which was slightly more convenient for them and were given a full refund for the days they would not be staying. We are unable to fill the room at such short notice and have lost out on income as a result. They had ample time to let us know their plans, but they did not grant us this courtesy, rather they left it till the last minute and left us in the lurch. I spend a lot of time and effort trying to make guests as comfortable, welcome and "at home" as possible. My feeling now is that I do not want to commit my time and effort toward hosting someone in my home if they are going to take advantage of me. We do not purely host for fun, we also rely on the income to pay our bills and if we do not break even due to last minute cancellations and alteration requests then we are out of pocket. This is my home and I do not want to operate within it while habouring feelings of anxiety about my guests potential lack of consideration when approaching the booking they have commited to. Upon changing my policy from flexible to moderate, we did not experience fewer bookings. Moving forward, I will have to assess whether or not having a strict cancellation policy will affect us. However, for my personal sanity and schedule, a strict policy is going to be the best option for us. I have to say, this experience has left a bad taste in my mouth and it makes me question whether or not it is worth the time and effort compared to a steady and secure rental income. We love hosting guests and have had great experiences for the most part having connected with people from all around the world. But people are fickle and bills are not! I feel like the longer you host and the more frustrating experiences you have with last minute cancellations, the more likely you are to tighten up your policy regardless of whether or not your bookings slow down. It just isn't worth the hassle.

[Lilian20]

When a guest , think like a guest. 

When a host , think like a host (or you will regret it). 

[Mushtaq0]

Within less than three months I have had 4 cancellations. The last one had booked right at the beginning and now canceled the booking 4 days before check in, where she gets the full refund from me (Policy:flexible). In all cases the reasons were financial and no emergency. Either they had got free accommodation with friends or families or as in this case had some other unspecified reasons. One of the guests canceled her booking just a day earlier and she wrote to me, if I would refund her voluntarily the one night she had to pay according to the policy. I refused for four reasons.

1. I did not want to set a precedence case, where I would have to apply the same rules to any and everybody who may decide to cancel on the last day.

2. This was not an emergency case, health or social misfortune or some other unforeseen reason not under the guests control, like weather or airline employees striking.

3. I had already invested some work, replacing the bedding for two persons (and since the next one was I single, I had to change it again, just because she did not cancel a day earlier!), a bit shopping for them etc.

4. Last but not least, I never got any booking for those days anymore. It was too late for that. Nevertheless I still did give her a voucher for one night free, if she booked again. And she mentioned in her review that both the facts but of course not the reasons for my decision, which may have thrown a better light on it.

Anyway I will be willing to refund the days, where I do then get my room booked for the same period and this I will do gladly, but that option I can have only when I have a moderate policy and not the flexible one. Therefore I am switching over to the moderate policy.

[Lisa367]

We have a strict cancellation policy, which used to be a good thing, until Airbnb changed the rules.  Now I only get 50% of the stay if someone cancels within 7 days.  It used to be 100%.... as it should be.  Guests will always cancel last minute when they do cancel and I cannot rebook that quickly, of course, so I should get 100% of their total stay, for sure.  On a personal note, I have friends who only book flexible rooms because they literally cancel their plans all the time.  It's almost like they book these flexible rooms to "hold" the room in case they change their minds.  I always get so mad at them, but then again, that's the hosts problem for having a flexible stay.  You have to remember that YOU come first and GUESTS come second.  Do what's in YOUR best interest.

[Lisa723]

We switched from flexible to moderate after too many last-minute cancellations. I don't think it has reduced our bookings, and I probably don't want a guest who chooses a listing because they can cancel it. But I think starting out with a low price and a flexible cancellation policy is a good way to get your business going.

[Kristine28]

Agree.  I did this very thing, started out with lower prices and flexible policy then began to raise prices to just below the competitors and increased to strict during high demand times.  

[Kristine28]

I just asked the same question from a different perspective.  I am in a high demand area for two months out of the year, then in a lower demand area for the remainder of the year.  I have had guests cancel on me 24 to 48 hours before arrival and being on a flexible cancellation status, I lost the money.  I did increase the level to strict as this time arrived for high demand and I cant say I noticed any difference.  But I also wanted to be able to have different settings preset for those high demand times, and have the remainder of the year set for flexible .  I am trying to find out how to make the system work to give me this option for my posting.