Choosing Cancellation Policy - Any Advice?

[Huma0]

I have always had a Moderate cancellation policy, but this week I had two separate bookings cancelled right before the five day period kicked in, and I mean one of them cancelled only two hours before this, so they both got full refunds.

This is annoying for a couple of reasons. Firstly, it's high season and I could have booked those rooms several times over, but I doubt they'll get booked now at such short notice.

Secondly, if the guests had given me good reason to cancel, that would have been okay, but they didn't. One cancelled because he wanted to leave his bags here for a day after check out and I couldn't accommodate this becuse I will be at work. I had not promised to store his bags, quite the opposite. I had refused to accept the booking until he confirmed he understood that I couldn't guarantee to do so.

Now I am thinking of changing to a Strict cancellation policy, but I wonder if this is going to put guests off booking. If there was something inbetween Moderate and Strict, e.g. giving guests a full refund up to 10 days before check in, I would, but there isn't.

I'd love to hear from hosts who use the Strict policy and how it works for them. Do you think you get less bookings as a result? Is it generally problem free, or do you get a lot of guests trying to use the Resolution Centre/Extenuating Circumstances etc. to get refunds?

Many thanks!

[Huma0]

So, it just happened again. A guest cancelled less than one hour before the cut off time for a full refund. I have had this happen to me more times in the last couple of weeks than the entire year I have been hosting.

Again, I don't expect to get an alternative booking this late in the day and it is high season, so I am out of pocket. I don't mind if they do it well in advance, but why are they all waiting until the cut off day, usually only 1-3 hours before? Seems like a bit of a coincidence, and rather thoughtless towards the host if they knew before then they were likely to cancel.

Has anyone else noticed a rise in last minute cancellations during peak seasons? Are they're just more flaky guests booking at this time of year? I can't believe that guests have more personal issues/illnesses etc. just because it's July!!

I think if this happens one more time, I will be switching to Strict.

[David126]

@Huma0

I have not noticed a pattern, well not yet, my impression is that most of my guests are newish and probably most of them have no idea what my policy is when they book. 

Maybe things will change for me.

[Huma0]

@David126 that's interesting to hear. The majority of my guests, although by no means all of them, are also new to Airbnb. The only thing stopping me from changing to a Strict policy right now is that I thought it might put guests off booking, but if they don't even look at the cancellation policy then maybe I should go ahead.

[David126]

@Huma0

Twice in the last week I had multiple book stays who left a night early and I said well cancel and I will refund if I can get another booking, and both times they said not to worry not an issue.

Now I do not charge much, but then you do not either. Depends on the guest type, I know one who was up for the big event locally and sounds like he did very well selling T Shirts so probably did not care,

[Huma0]

@David126, yes I'm also happy to give a refund if I get another booking, but my guests are all cancelling just in time to get a full refund anyway, and too late for me to get a new booking!

Perhaps it is just a run of bad luck because I've had very few cancellations until recently.

[Farah1]

@Huma0 this year alone, I experience more cancellation than the past 3 years combined, I believe. I remember back in NY,  I only had 1 cancellation in the entire time and it was because her dad got sick and she did not ask for a refund. In my 1st Seattle house, I believe I also only had 1 cancellation that I can really remember and it was because she claimed the room was not what she expected (not sure what this meant) then she canceled and did not ask for a refund. However, in the current house, I think I already have at least a couple cancellation, 1 of them is an IB booking and he did not do his responsibility of reading the listing in full. All of them for the entire unit that I rent out I believe and all for the summer. It looks like these people who canceled did not plan ahead/plan well and therefore they need to cancel. None of them (other than the IB guy) ask for a refund and everything is based on my strict cancellation policy. I did not mind giving 100% to the IB guy because it was canceled within 1hr and I still have a few weeks to fill the date.

Fortunately, in the 4 years of hosting, my place has always been booked and I always have strict cancellation policy since the beginning. So, I do not really have a comparison of whether I can perform better/worse with the other cancellation policies.

[Huma0]

Hi @Farah1 thank you for the information. I think it's quite useful. Seems like there are more flaky guests out there now than before. Seriously thinking about switching to the strict policy.

[Marie21]

@Huma0

sorry to hear that i have strict cancellation not sure if he impact my booking but i have some popular apartment who as always fully booked regarless of the policy but lately i get ,many last min booking from businesses so i end up having a good month on more residential location.

I will never go flexible for the simple reasons we spend lot of time answering email message sending info and so on if guests decide to cancel all this time is wasted.

and he gave options to guests to shop around and change their mind and make non sense request for example ur guest asking to keep their luggage an extra day while in london you have many left luggage.

Let cross fingers and hope the days u got cancelled u get lucky to find last min booking

[Huma0]

Thanks @Marie21, yes I also spend quite a lot of time corresponding with guests, including helping them with detailed travel information, tourist information, responding to all the questions that are already answered on my listing etc. so it is time wasted as well as income lost.

This includes the guest who wanted to store his luggage and there were quite a few messages back and forth to get him to confim he understood that I could not guarantee him this, nor check him in hours early. All this for a two-night stay.

I did send him lots of info on left luggage options, but he said he would be too busy to use these. He assumed that I'm not too busy to act as his free left luggage service and spend an evening waiting around for him when he's not even staying staying here anymore!

I did get some last minute bookings to cover some of the recently cancelled dates, but not all of them I'm afraid. One room in particular has been empty the last few days and doesn't have many bookings for August. It should have been fully booked like my other rooms, but I had three separate sets of guests cancel last minute for this room!

[Joy298]

Hi @Huma0 

I checked your listing and could see you are now on a strict policy. I would be very grateful if you could share whether you've seen any difference upon booking rate?

I'm also considering changing my policy as I've recently got 2 cancellations happened just hours prior to full refund window closed. Both were from experienced bnb guests(one only has a 4.5stars rating and was not recommended by some hosts. I assume this is a very low rating for guests as most hosts tend to give good rating if nothing serious happened). I even doubt they've got something like script reminds them of doing that on time. Neither has given me a single message even the simplest "sorry".

[Rosemarie9]

Hi Huma,

I had a moderate policy up to this year,until the same thing happened to me,three cancellations in my first booking window, just before 5 day window,no reason given. I think people put requests in and then shop around or change their dates, but it is annoying. I changed to strict and didn't suffer a booking decline yet,although David is correct in stating that there is no real guarantee that your policy will be enforced. It just eliminates those that are not serious.

[Jeff158]

3yrs on strict and only had one cancelation and that was only due to guest booking the right week in the wrong year.

No idea where your bookings are coming from but:

Its well known in the B&B trade that bookings from certain countries are only made to obtain the booking confirmation. Once a visa is approved or declined they would cancel.

[Huma0]

Hi @Jeff158 that makes sense, but I don't think visas were the reason in my case. Examples of reasons given:

1. Change of plans - no other info given, but this guest had already changed her booking dates a few times so I think her plans really weren't firm in the first place.

2. Girlfriend dumped boyfriend. Boyfriend tried to commit suicide.

3. Cancelled because I couldn't store his luggage for an extra day, even though he said he understood this before I accepted the booking.

4. Not feeling well.

[Huma0]

I am not sure now about the idea that guests don't even notice the cancellation policy when they book.

A couple of days ago, I decided to change the policy to Strict for one of my rooms - the one that gets a lot of bookings months in advance. I don't want people booking now for the Christmas/New Year period and, after months of those dates being blocked, cancel on me penalty free five days before. That's one of the busiest times and I can't afford to lose the income.

However, as soon as I did this, the first enquiry I got, the guest mentioned that the cancellation policy was too strict. This was not an experienced guest, but a first time user, asking questions like, 'How do I book?', 'How do I pay?' They hadn't been able to figure out this basic stuff by themselves, but had noticed the Strict cancellation policy!

It told them that if they gave me a month's notice, I would give them a full refund. The booking would be for New Year so I really don't want that booked by a guest who might cancel last minute.

Anway, they didn't book. As far as I can tell, the cancellation policy was the only thing that put them off.

[Fred13]

I look at it the opposite way, not from the guest's side, but from the host's side. Example, which policy best fits the offering. If a place requires more than a week advance to get ready for then it merits a 'stricter' policy because it will be impossible to re-book with too short a notice. I have (and pay extra) for Super Strict 60 because my offering takes at least 60 days to get ready for it, and thus need at least that much time to re-book it in case of a cancellation.