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:
Sorry that I didn't read Your post yesterday, as I said I was occupied with something else. Also I got pretty drunk later.
But I did read Your post now. Thank's for rerolling the 2018 Australian payout crisis.
You said You never had a payout problem. That's fine, but that doesn't mean You may have a problem in the future. And thousands of hosts are having payoutproblems every day. Don't You read this on this forum? Robin, You are just trying to make airbnb look better than they are.
@Ute42 I've never had a payout problem either, or a bad guest, or any guest issues I had to contact Airbnb about. But that doesn't mean I'm immune from it, anymore than I'm immune from contracting coronavirus just because I've managed to avoid it so far.
And I'm disgusted with Airbnb every time I read about a host who has thousands of dollars of unreleased payouts owing to them , which Airbnb keeps passing off as a "tech issue" or hosts who get their listings suspended because of Airbnb's knee-jerk reaction to a guest claiming there was something "unsafe" about it, or Airbnb doing nothing when a host calls them to say the guest has snuck in 40 more people and thrown a trash the house party.
Because that could be me the next time.
I remember that one & it did not reflect well on airbnb - the float on all those delayed payouts must have been a nice bit of extra cash. When a screw up by a company results in a profit for the company, there's little incentive for the company to do better. (from the point of view of their bottom line they did do better & why not try it on again from time to time)
@Ute42 I put the price much higher on booking com, because they have extortionate taxes and deductions. And most importantly, it is not clearly written anywhere, I get different amounts every time, but in any case it is 100 euros from the 150 indicated in the booking.
@Ute42 I have to find other platforms. I list on VRBO with lower prices than on Airbnb, but I get almost no action from VRBO unless you count scammers and people who whinge about the price. At the end of every season I raise my Airbnb prices about 5%. (Hotel prices go up on average roughly 3% a year.)
We've heard this new price structure is coming for several years now - I believe @Susan17 warned us all. I wonder though how Airbnb will handle the occupancy tax that allows them to jack up their service fees with this tricky double-dipping calculation:
They calculate the 9% occupancy tax on nights+cleaning+service fee.
But the 13% service fee in the example - $402 - is calculated on nights+cleaning+occupancy tax. It would only be $370 if calculated solely on nights+cleaning.
And if the service fee was $370, the occupancy tax in the example above would be $289.
I find this truly despicable. And it's less onerous on me than it is on the guests.
How will they scratch out those extra dollars if they separate service fee from nights+cleaning+occupancy tax?
I have liked 'Option #1' best all along: charge me a mere 3% to bring the customers and take care of payment, and in exchange, I will..
1. Run the customers I even get through my own website through Airbnb
2. You will never hear from me and I can't think of a reason to hear from you.
A match made in heaven.
In the "normal" fee system there is a difference in Guest Service Fee for "long term stay" (approx 11%) and "short term stay" (approx 15,5 %). So on the "host only fee" system this difference is not possible anymore ! i also wondered about VAT. The fees are subject to VAT and if Airbnb is charging them themself, they are in control about the VAT But if they simply deduct 15 % from the Host payout, then what about VAT rules ? .
It is common on other platforms, such as Booking and Expedia, to charge the host a 15% commission, and hosts must adjust their rates to account for it. Most guests are none the wiser that they are paying for the commission, because it's not listed separately. Airbnb is attempting to change to this model so the rates on their platform are the same and competitive with rates for the same listing on other platforms.
The difference is that these platforms allow the hosts to collect the payment directly, including a security deposit. Also, they offer cancellation policies that have free cancellations that end as far out as 30 days before arrival. If the guest cancels within the free cancellation period, they are refunded all of their money, and the host doesn't have to pay any commission. These are very important points, because Airbnb made no mention if refunds will be handled differently than they are presently where the service isn't refunded after the free cancellation period has ended or if the guest has already received 3 service fee refunds. If the refund policy doesn't change, Airbnb is just increasing its service fee take at the hosts expense, because they are not going to give the host the 3% that was previously collected at payout.
Yes, it's very probable that the commission fees are based upon the location of the listing. Every platform has its pitfalls. In my experience, 15% commission is the base amount charged by Booking and Expedia. The fee increases if you allow them to process the payment. For example, I paid Expedia 15% when I collected the payment, and paid my credit card processor between 3-4.5% to take the payment. When I let Expedia collect the payment (Booking doesn't offer the service in St. Lucia), I paid them 20%, and still pay a 3% credit card processing fee to get my payout, because they issued electronic virtual cards. However, I still received the guest's credit information for the security deposit and incidental costs. This is very important, because I am able to enforce my cancellation policy and house rules, and Expedia has never over-ridden my cancellation policy without my permission.
My primary problem with Airbnb trying to be more like other platforms (guest anonymity prior to booking: no real identity verification is done, allowing unverified guests to make reservations, not requiring that each guest be listed in the reservation, etc.) is that unlike them, Airbnb still wants to control the entire financial process and be the arbiter of all financial matters. So, they want hosts to accept the risk of hosting total strangers, and deprives us of the ability to personally remedy situations in which the guest has breached the TOS, cancellation policy, or house rules.
@Debra300 Thank you so much for your detailed explanations! It is easier for guests to make payments via bookingcom , so such a large commission for payment processing kills the whole point of working through booking. ((
I'd prefer Airbnb's method of payment collection if they would actually collect a security deposit (or at least a pre-authorization hold against a credit card), use more common sense when reviewing claims from both guests and hosts (stop issuing refunds after the stay has ended and denying reimbursement requests even when the guest admits the infraction on Airbnb), confer with hosts (and obtain agreement) when trying to determine if the cancellation policy should be over-ridden.
I know that my rental situation is different from those who home share and have to interact with guests, but as long as I have a way to make a guest financially responsible for their behavior and actions while staying at my place, I really don't need to know what prior hosts thought about them.
I understand that there is a concern that hosts may abuse credit card details, and that is one reasoning for not letting us have that information. However, the other platforms have implemented measures to vet hosts to guard against widespread mishandling of credit cards. For example, they have the banking details and require a payment method (same as Airbnb), new hosts are not allowed to see credit card information until 14 days before arrival (effectively setting the cancellation period to 14 days before arrival), and the credit card info can only be viewed three times.
Hosts do incur some risk even with having the ability to charge credit cards. The other platforms do not verify the validity of the credit card or the availability of funds. The hosts can find out this information only when trying to process the payment. If the credit card isn't valid, the guest is given 24 hours to submit another form of payment before the reservation can be canceled.
As I said before, there is no perfect platform, not even your own website.