How do you calculate your listing price?

Lizzie
Former Community Manager
Former Community Manager
London, United Kingdom

How do you calculate your listing price?

Pricing.jpg 

Hello everyone,

 

When you first set up your listing, one of the first things you need to think about is how much you price your home per night. From hearing from several hosts here in the CC, I understand that many of you take into account a number of different factors.

 

Plus, I bet even if you have been hosting for a while, this is something you keep a close eye on.

 

How do you calculate you prices? Perhaps you consider overheads or consider other listings in your area. What tips would you give a new host?

 

Thanks,

Lizzie


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55 Replies 55
Giselle48
Level 2
England, United Kingdom

Hi i am only hosting 1 month now and i have a slight issue. I have 2 rooms with 2 private bathroom as well. Hosting 4 ppl. I priced my rooms at 35 pound per night but what i dont understand is why i am not allowed to charge 35 pound per room on the site. As i would like to be flexible to 2 or 4 guest at a time. Please help if you can. 

@Giselle48   You have posted this in the middle of a thread where it doesn't belong. You'd get more responses if you started it as a new topic, or just search- your problem has been covered in many threads before.

But to briefly answer your question, you need to list each room separately, each at 35 pounds. Then a listing that combines both rooms, for 70 pounds, or whatever, in case you have 4 ppl wanting to book together. Then link the calendars so when one of the 2 rooms is booked, the listing with both rooms combined becomes unavailable.

Hi sarah , sorry about that i was my first time using this. Thanks alot for the advice tho. 

When I first started hosting, like many other fellow hosts, I had no idea what price would be appropriate so I looked at listings that were similar to mine and priced myself slightly below in order to get bookings come in. 

After a few inquiries and bookings, I was able to determine what type of guest seemed most attracted to what I offer, then I started looking at other types of accomodations that specific type of guest would consider besides airbnb to adjust my price level. It took me about 1yr to reach a price point I feel is appropriate for what I provide. I still regularly search to see what other people are charging 🙂 

I usually ignore pricing suggestions from airbnb because they are mostly ridiculous. And when potential guests ask for a discount, I am able to confidently say "My rates are non-negotiable. It seems we are not right for each other, so good luck finding a place that better meets your needs" because I know my competition and I have a pretty good idea what other listings/options that person is also looking at. 

 

 

Oomesh-Kumarsingh0
Level 10
Pamplemousses, Mauritius

@Lizzie What i usually do to update and set my pricing is to compare the price of my direct competitors who have the same number of rooms.Then i set my price approximately 10% to 20% depending on demand and seasons.I have noticed that when your price is above the competition you tend to receive longer stays thus bringing you more income while doing less checkins.This occurs simply because the cheaper listings receive many short terms stays that prevent them from hosting guests who are looking for longer stays.For those of you who wants to receive long term guests and reduce the numbers of checkin and all the work that comes with it be more expensive than your neighbours.Strictly do not let Airbnb constant emails affect your pricing.Good luck and happy hosting!!!

Torbjörn-And-Amila0
Level 2
Norrtälje, Sweden

Tried to sign up for Wheelhouse but seems like our region aint available yet, anyone in South Europe(Croatia) who are using another/similar tool?

Esteemed hosts, friends, ladies and gentlemen, the time has come: the serious problem that has always plagued most hosts everywhere must be faced once and for all, and, therefore, it will be done here and now, without hesitation, without stupid indecisions. However, the right listing price. I mean: how do you calculate it?

 

An answer to this question today is given by a woman named Emily who is neither a host nor a guest. It’s not to be believed.

 

To be fair, I used AIRBNB with a satisfying outcome on the behalf of my father some time ago.

Not now. Not anymore now. I do not intend to give that old host a new life.

 

I have hosted anything and everything: California dream men, tuaregs without a camel, melomaniacs, Barbie girls with a change of clothes to make Lady Gaga envious, dancers, dentists, Miami beach lifeguards, Middle-earth dwarfs, Indian paleontologists, Olympic athletes, Japanese androids and Dublin electricians. In short, a cast for a film by Federico Fellini.

 

A memory that still tickles my heart, and lives in the flavors of a past more than ever present. For example, the guest book, which I still keep locked in a drawer of my desk in Milan, and occasionally smells to soothe this feeling of nostalgia. What remains is the love and the longing.

 

Do you want to know what my approach to prices was?

 

And so it shall be, ladies and gentlemen. I am referring to Milan. Art city. Strong flow of visitors. Well connected area.

 

When I started (in the Jurassic period: I still remember the Brontosauruses in the cathedral square) I had absolutely no idea of ​​what price would have been appropriate. So, I looked around  (ads for rooms similar to mine in that area of ​​that neighborhood and services offered) and I tried to figure out how the bloody  algorithm of AIRBNB worked. The first results generally corresponded to the best ads for that category.

 

At the beginning, to climb the summit, I did prices slightly below the average to get bookings and good reviews.

 

Then, reached the coveted summit, disregarding badges, trophies, scores, pressing invitations to lower prices, I raised the prices, but not taking them “off the market”.

 

Price differentation: weekend, weekly, monthly, seasonal (September-October = students and teachers, March-April = beginning of exhibitions, events (Furniture Fair, Fashion Week, etc.), synchronizing the calendars on multiple platforms to avoid overbooking.

 

But I had not considered two variables: cleaning costs (independent of the number of nights) and AIRBNB charges: I thougt I need to reconsider my marketing policies.

 

I had some limited success, but more needed to be done. So, I asked myself: "What are you doing wrong, bad girl?" I saw the top ads, the most glamorous ones that I had not previously considered.

I tried to understand what really made those ads really special. I decided to expand my range of action. A small makeover, some slight modification of the offer (better quality) was enough to make the difference, to make the stay more comfortable and "exclusive", intercepting a higher target market. Result? My occupancy rate suddenly rose.

 

Without listening to the melodious song of AIRBNB sirens (with warm wax, plug your ears, like Ulysses, and let yourself be tied by the co-host to the ship's mainmast), finally you will understand in which price range you can put your room/flat reaching your Ithaca!

 

But be careful, ‘cause the right price should not be established forever, but it’s something that must be conquered with the sweat of your brow: in a hypersaturated market, constantly keep an eye on your price, taking account of competition and escaping the pitfalls of Scylla and Charybdis, Circe and Polyphemus.

Kevin740
Level 2
Washington, DC

I live in Washington DC.  It’s a very expensive city in which to live and visit.  Neighborhoods change in terms of demographics, location, crime, etc., from several blocks to the others.  As a result, Airbnb has an algorithm on charges based on these criteria and also  prices of nearby Airbnbs.  

 

The electric company raises prices prices dramatically during air conditioning season; I just received a bill higher than ever (living in the house for 15 years).  I’ve had a guest for two months who uses lots of energy: running and air conditioner and ceiling fan when it’s 57 degrees outside (beyond my comprehension and sensibilities).  This activity—set in context—is a house where 15 windows are open and the owner spending most time on from porch (no

AC), yet he’s in his room with the AC blowing and a ceiling fan cranked.  He leaves lights on 400 Watts in the kitchen when I have under counter lighting that draws only 7watts.  Granted, I am not 24 like this guest, but the electric AND water bill I just received is more or less has created a net loss.

 

my question is: how much are we reasonably required to provide when a host sees ridiculous waste?  Why does someone need AC AND a ceiling fan on high when it’s 57 degrees?  I am holding my tongue, but I want to inform him that the windows in his room actually open.

 

i am considering closing Airbnb to long-term guests because I realize I’m losing money and patience.  Not to mention the multiple showers per day; acquisition of mold in the bathroom because he’s clueless about taking care.

 

has anyone else run into these negative numbers with long-term guests?  Can we limit the number of showers a guests takes per day?  Can we tell a guest that all the windows in the house—front and back doors too—indicate that weather at 57 degrees does not necessitate AC?

 

I am not cheap, but I am thrifty.  I cannot wait until this fellow moves out because of the amount of money he’s costing me.  And his living habits are so foreign and expensive to me.

 

what is our obligation?

 

i look forward to your assistance.

 

kevin

@Kevin740   57 degrees and he has the AC on? If I were in your shoes, I'd turn off the breaker to the AC unit , or otherwise disconnect it and tell this clown to open the windows if he's hot. You don't owe him a break-even stay. Young people need to be educated. If his parents didn't do it, it falls to anyone who has the misfortune to be in his clueless path. He's probably never had to pay an electric bill in his life.

@Kevin740

I host long-term guests in their early 20s so I have an idea of what you are going through.........for long-term guests one thing many hosts seem to forget is they need to factor in the cost of utilities/internet/cable etc. into the total monthly payout, and the cost of in-between cleaning/laundry (sheets/towels)/amenities  - things a normal renter would spay/supply themselves - when deciding on the monthly discount which will determine the total. Also like you are experiencing, because the guest is not the one paying for utilities, they have no reason to be "thrifty" and won't care. Why do you think hotels have systems that shut off automatically when guests leave the room 🙂

 

The way I manage is to not hand over control of the AC/heating thermostat to the guest (but considering your current situation, I would do what @Sarah977 suggests). Henry and I are the only ones that can turn it on/adjust temp settings. I also state in my listing description that AC/heating is turned on when indoor temp exceeds/drops below a certain point. If a guest seems to take exceptionally long showers, we will temporarily adjust the hot water setting (make it lukewarm) after 15 mins - we've only done this a handful of times 🙂

 

Henry and I are not shy about asking the guest to open/close windows and turn lights off. When we find the guest has all the lights in the kitchen on, I will just walk in and turn off the ones I feel don't need to be on, then with a smile say "Still bright enough, right?" In most cases, I notice guests follow our lead after a while and get the hang of which lights to use when doing what/where. We emphasize the importance of not being wasteful with water/electricity and the fact that we recycle. We also ask guests to use towels more than once and to do larger loads of laundry to conserve water.

 

IMO, you can and should express your expectations to guests.......you don't have to tip toe around them and put up with bad, wasteful behavior. Maybe they will change, maybe they won't but at least you tried. Hope this helps~

Sally98
Level 2
Blenheim, New Zealand

I would like to know how much to guest is paying in total, so including all airbnb fees as well. I can't set my price until I know exactly what the end user is paying and I don't know where or how to find out his information before setting my prices. 

@Sally98

It would depend on whether Airbnb collects any taxes on behalf of the host, but based on my experience guest service fees are usually about 12%, and then there is the host service fee (3%) too.

Also the cleaning fee to consider into the total. (same amount regardless of # of nights)

 

Fyi~ I don't have a cleaning fee so I simply assume there will be a 15% difference between what the guest pays and the payout I (host) receive. This has been accurate enough for me. 

Alex939
Level 10
Plovdiv, Bulgaria

At the beginning I just looked around and put a price as the competition had, then Airbnb suggested 10% off for the start, I made it and the bookings came. Later I set it up according to the season, day of the week, number of guests, duration etc.

We base our price on two factors. One what is the standard around our area, we are in between the really pricey and some inexpensive, so we set it .. in between. 

Second, what we are comfortable with.. If I feel like we are giving it away then it is not ok. we have a room in our home..... and we do it for a little extra fun money... so we do not need it to be rented.

 

We have found that it is better to lose a guest reservation then take one below value... 

That is just us... We do have a cleaning fee... 

 

It works for us... but my one piece of advice.. Make sure you as the host is comfortable with your listing price... 

Helen427
Level 10
Auckland, New Zealand

Just an observation, none of you have mentioned your own time value.

With all the international arena and Councils etc wanting to impose extra regulations & conditions it's timely to stop & consider your own labour in your pricing, just like people in bureaucracy get paid by the hour we to are worthy of our services.

 

My time is valuable and is something I factored into my Listing.

It's important to compare rental rates for rooms to let in the wider communities that people who are staying in Rentals, local camping ground, hostels & motels - I pointed that out to a Guest in a Review reply and suggest others who may receive negative review feedback or value ratings to reply kindly as I have to your Guests who may not have considered prices locals pay is often different to their own quality of accommodation & costs of living.

 

Motels do offer weekly rates to guests over 28 days in NZ.