How should I price my listing in 2023?

Sybe
Community Manager
Community Manager
London, United Kingdom

How should I price my listing in 2023?

Sybe_0-1672922674023.png

 

Hi everyone,

 

The last few months have been tough on us all with rising prices for utilities in many regions of the world. That being said, one of the most interesting (and most searched!) discussions here on the Community Center is around pricing strategy, tools and opportunities such as local events. 

 

As we settle into 2023, what were your biggest learnings on pricing in 2022 and what do you hope to try out this year?

 

I’m looking forward to hearing your thoughtful reflections and hope that we can share tips here.

 

Thanks,

Sybe

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46 Replies 46
Ann72
Level 10
NY, NY

I hate when that happens @Trude0, but unlike @Fred13, when I went to your profile I saw the reviews in date order, most recent first.  I don't know why that is but rest assured that not all your potential guests see the reviews out of order.

Fred13
Level 10
Placencia, Belize

Yes, as a direct result it gives the impression only 6 people stayed the whole year. No good.

Trude0
Level 10
Stockholm County, Sweden

@Fred13: Actually, only 5 people did stay in one year, since I took the long break. So if you see Anna, Simone, Merel, Eleonore an Jennifer first, then they are sorted by date for you.

 

Weird - when searching incognito I see only Jennifer on top, then Paola, Dine, Mu and Rong. Anna is nr 40. And I know from another host who has the same issue as me, that she saw the same thing. 

Fred13
Level 10
Placencia, Belize

I am seeing then what @Ann72 is also. This has come up before, the host sees something different than other hosts and visitors at large see.

Fred13
Level 10
Placencia, Belize

Hey @Ann72 . Yes seasonal cycle definitely has a bearing. 

 

After 12 years in warm Belize, to me now anything above the Mason-Dixon line during winter is part of the Artic Circle  (❄️)  when only polar bears should be booking. 😄

Ann72
Level 10
NY, NY

I'm glad @Fred13 that I had a few polar bears book two of the places over the holidays!  One left a bit of a mess after two weeks (he refused mid-stay cleaning) but as he paid full freight and basically covered my winter bills, it's all good!

Patti120
Level 4
California, United States

@.Sybe. Update on my listings. Airbnb now has the full year for 2023 priced at or within $4 of my minimum night prices yet the comment says searches are up 37% in the area. It’s obvious the company is working on the pricing algorithms. It looks like they have turned them off for now.  If you get good Intel Sybe, please share it. Thank you, Patti

We're keeping a close eye on pricing and making adjustments almost weekly.  Since most of our bookings at our homes in Rapid City, SD, are made by people more than 5 hours away and an average of 60+ days in advance, we make heavy use of the promotion tool to help fill unbooked days within the 2 month window.  This sometimes means that we're taking bookings at less than ideal rates, but as long as we're covering our variable costs, it makes sense. 

Patti120
Level 4
California, United States

@.Sybe. 

@.Sybe. Thank you for your questions. I have 2 Airbnb's at the beach in Ventura, California. I did not raise any of my pricing since 2021, let the Airbnb pricing algorithms do their magic in 2022 and monitored what happened. Also, I have looked at all of the comparison listings Airbnb provided and gave feedback on what was a similar listing and what wasn't (thumbs up or thumbs down). The algorithms changed the pricing based on demand for the similar listings. (It was very interesting to see what happened). The homes for most of 2022 continued to book well. After the big adjustment to the search structure, the pricing changed too. My upstairs 3+2 Ocean view is priced between $388-$425 typically. The Airbnb algorithms raised it to, in some cases $476-$650. A few nights at the end of 2022 it went over $1100 per night (Crazy). Similar things happened to the downstairs home 2+2 no view. The pricing typically ranges from $292-$355 per night. The Airbnb algorithms raised it to $400-$680 per night (Also Crazy).  

 

As a result of the obvious malfunction of the pricing algorithms I am monitoring the daily pricing and adjusting it to what I know the market is or close to the current market rates for similar listings in the area. 

 

In addition, I noticed the Promotion feature was having issues in November 2022 and have called customer support to figure out what can be done to provide a promotion.  One out of 3 customer support persons were able to help me and one showed me a work around that would only work for a full week or more. It isn't possible to offer Thursday through Sunday any more which is the period when most people want to get away for the weekend. The weekly promotion has not resulted in any bookings. 

 

Since the Airbnb computer and algorithm issues showed up, my 2 homes have been vacant over 6 weeks in December and January, which is highly unusual.  I did have some cancelations due to illness however they did not rebook quickly as they usually do. I am on Instant book with a Flexible Cancelation policy. The Crazy pricing, I believe was a contributing factor as well as the Promotion ability issues.

 

Fortunately my repeat guests are able to find the listing, but the Crazy pricing had a negative effect. If we are not making money neither is Airbnb. 

 

The latest pricing (as of the first week in January 2023) on Airbnb now reflects my minimum pricing or close to it. Another recent Airbnb computer change.

 

One of the news updates for Hosts suggested we change our listing descriptions and update and/or take new pictures. If the listing is successful do the hosts really need to do this or are these search algorithms being modified too? If they are (which I suspect is happening) then I will be complying with the suggestions. I do have concerns that the upcoming changes to the Airbnb Search results in the same debacle the pricing and category changes have had. The Airbnb IT Department learning curve had an overall, negative affect on my business in a significant way.  I can see they are figuring it out, but my concerns are elevated. 

 

Lastly, I conducted a customer  Ventura Airbnb Search a few days ago. M

 

 

 

any of the listings are showing a significant reduction in nightly prices, sometimes more than $100 per night. Also it is curious that there are listings for Oxnard, Malibu, Santa Barbara in my Search for Ventura (Only). The statement from Airbnb said there were 1000 listings in Ventura. There are only 213 Short Term Vacation Rentals Licensed with the City of Ventura. The County of Ventura has about the same amount. Malibu, Oxnard and Santa Barbara are not Ventura.  My personal Airbnb Search shows how out of whack the Airbnb Search Engine still is. 

 

My apologies for the length of this response. The question is complicated, the answers are many and I have been doing a lot of research to try to figure out how to keep my properties booked through Airbnb. At present I do not have them listed and have not had them listed with anyone else. Airbnb is a great company and a fantastic concept. I hope the powers running this company can get it back on track. As a Customer and Host, the personal touch and attention to detail brought me to Airbnb.  The AI, IT and changes to a BOT response system isn't good hospitality on its own.  Hospitality is a personal business. It is very hands on. Good luck to us all in 2023 and beyond.

 

Cheers,

Patti

Ana2038
Level 7
Santa Ana, CA

@Patti120, I agree with your assessment on the “recent changes/improvements” made by Airbnb. They have not been host friendly in my opinion.  I now have to check my pricing every day, and make adjustments accordingly. Sometimes when making pricing adjustments, the system locks up or locks me out.  I have worked harder in trying to keep a 90% occupancy rate in the last 6 mos than I have since I joined Airbnb (2018). 

I can no longer rely on Smart Pricing as some of the nightly rates were ridiculous for my listing. I too compare pricing with similar listings and again adjust accordingly. However, similar listings that pop up are not similar at all (shared rooms, full kitchens…etc) and/ or have much lower ratings than my listing (and yet, they are listed on the 1st page of searches at times whereas my listing can be found on 3rd or 4th page). I have gone incognito and at times can’t find my listing at all. 

It’s frustrating to say the least. I too hope that Airbnb fixes its glitches, AI, thought process, competent customer service and brings common sense back!

 

 

 

Patti120
Level 4
California, United States

.@Ana2038 Thanks for sharing your experience. We are all going to have to be proactive managing our listings now and into the future until Airbnb gets their problems worked out. Corporate has done such a good job until recently.  I wonder if their system was hacked. Hacking seems logical due to the length of time it is taking to get the systems up and running properly. (Things are still not right with search or pricing although they are improving). Airbnb is working hard, I can see it as the systems controlling my listings are constantly being changed/updated and improved.

Fingers crossed they figure it out soon. In the meantime I will be monitoring and manually changing the things I have some control over. Good luck to us all. Thank goodness for repeat guests. I love them!

 

Ann72
Level 10
NY, NY

@Patti120  I liked your thoughtful reply.  I had the same experience with Smart Pricing last year, but I just let it happen, and I only had three unbooked nights where the price was ridiculously high.  This year the pricing is hovering at my minimum (which is quite high, where I want it to be), so again I'm just leaving it alone.

 

My bookings are not complete for 2023, but what I have on the books are mostly returning guests.  They've learned to book early if they want to come back.  And I've learned that the bookings (for seasonal houses in Maine) pick up in January and February.  So I remain patient and believe it will be a good year.

Huma0
Level 10
London, United Kingdom

@Sybe 

 

I put my prices up a couple of times in 2022, without adverse effects and guests continued to tell me my listings were good value. The main thing is to remain competitive within one's market and price accordingly. Before putting prices up (or deciding to lower them or keep them as is), one must of course check out the competition. In London, where there are so many listings, that's quite time consuming, but it gave me confidence to raise my prices as I realised that, even after doing so, I was still very competitive.

 

I really felt it was necessary. Energy prices have gone through the roof, but pretty much everything is more expensive, even toilet paper. My cleaners put their prices up and fair enough. They have to make ends meet too. Rents have gone up, mortgage rates have gone up... so naturally, the price of STR should follow. 

 

I do understand though it's difficult if one is relying on tourism and those tourists are thin on the ground, or if one's competitors are all lowering their prices. What I have been told by guests (and this seems confirmed when I search on the site) is that Airbnbs in London have become more expensive, not less.

Skylar0
Level 3
New York, NY

I use PriceLabs to automate my pricing, which does an excellent job. I've experimented with several other external pricing tools (Beyond Pricing, Wheelhouse, etc), and PriceLabs returned the best results. I highly recommend it. 

Maria568
Level 4
Stanthorpe, Australia

It is good to hear people's opinions .. every country and region is different , our bookings have been steady in 2023 comparing with 2022 and we do have a high /low season in Stanthorpe, Qld , Australia . I need to increase my rates every year but not too much and this year will be the same. Good luck everyone !

Casey242
Level 2
Malakoff, TX

Hi Sybe!

 

After having a steady decrease in reservations in the last quarter of 2022, we have decided that raising our rates would not benefit us in accumulating bookings. 

 

This is my third year of hosting four lakeside cottages, opening during the pandemic's beginning. 2022 was the first year to track our booking pace accurately.

 

I hope my occupancy rate increases this year! Crossing fingers!

Sybe
Community Manager
Community Manager
London, United Kingdom

@Casey242 I hope so too! A big factor in deciding whether to raise your prices or not is the goals you have set for yourself and your business.

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Yvan105
Level 1
กทม, Thailand

Thailand also sees an crease in prices, however not as much as Europe for instance. I believe the demand will increase for long term stays due to a more affordable cost of living, hot weather, and overall better quality of life. I might slightly increase my prices but will keep my hosting competitive no matter what.

Fred13
Level 10
Placencia, Belize

My instincts told me a year ago not to increase my prices for 2022 because the excellent 2021 was markedly due to a 'pend up' demand fueled by the 2020 lock downs.  For different reasons I am holding my prices once again for 2023 because it promises to be a soft economy which will influence the market our guest who come from primarily the middle classes, and not from the crowd inelastic to price who are either truly wealthy or on corporate travel junkets.

Dineo4
Level 2
Sandton, South Africa

I’m holding my prices too. I’ve noticed that units similar to mine in the same complex are empty while I’m fully booked until Feb. I noticed the only difference is price. So with this economy, it’s a tough choice. To meet all monthly costs or to make profits 

Sybe
Community Manager
Community Manager
London, United Kingdom

@Dineo4 It's a tough decision but sometimes it's better to focus on staying afloat rather than sailing with a sinking ship! 

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