I believe under our current Covid legislation you can only accept guests from a maximum of two households - does this booking meet this criteria? @The-Brindley-Hall-Team0
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in terms of the photo shoot - you are offering a STR not a photo shoot venue and your guests should have no expectation that you can provide such an amenity particularly as you say you make it clear on your listing grounds are not an amenity that is on offer to those booking your STR. Nor should they looking to bring an additional 7 people onto your property.
Just confirm to your guests they have booked accommodation to stay in not a photo shoot location, that the outdoor space doesn't form part of the property they booked.
say you are sorry to hear they want to cancel and that if they want to do so, they need to contact Airbnb who will process their cancellation under the policy they booked under.
why did you accept a one night booking by the way when you have a minimum two night. Stay ?