Price increases

[Kathryn599]

Hi.

Is anyone thinking of increasing their prices with the new energy price caps coming in?

If so how much more are you thinking of?

[Emiel1]

@Kathryn599 

In my country energy prices are also sky-high, so prices must to be increased to cover expenses.

I am even thinking about closing during winter, as there will be hardly any profit, even when raising prices on Airbnb..

[Gordon0]

Yup, @Emiel1, I've already blocked out January and will probably do so for the first few weeks of February too; I can't afford to host a guest who'll pump the heating up and open the windows too!

[Sudsrung0]

@Kathryn599 

I dont think we have much choice even here in Thailand electric has gone up and so has everything else, cleaning stuff,

At the moment I have increased my rate about $10 for bookings we are doing ok, this is our low season we already have bookings for high season, which is good.

[Richard531]

@Kathryn599 @Sudsrung0 @Emiel1 Our energy prices have not changed in any significant way.  But even if that were to occur, pricing should have little to do with operating costs on your listing. 

Pricing should keep you competitive in the market your operating.  So if everyone is ratcheting up their prices, you can then feel at liberty to do the same.  On the other hand, you don't want to raise your prices if everyone else keeps them lower.  You'll lose bookings.  Even if you make a marginal $1 on a booking, that's still better than $0.  

[Helen3]

Sorry I don't agree @Richard531  in the UK energy prices are going up massively - mine have gone up by around a £100 a month to £296.

Of course pricing should take into account your operating costs - we are running a business. I and other hosts would be foolhardy to price at a level that didn't take into account such a huge rise and would lead to us making a loss.

I increased my prices last spring to take into account these increases and have not suffered a drop in my bookings. 

Of course I take into account competitor rates. I can see I am in the top 10% price wise for my type of listing in my area - but because I have great guest reviews and offer fantastic value for money for what I offer I still get the booking I need. 

[Huma0 · Accepted solution]

@Richard531 

I have to agree with @Helen3 here. I am surprised that energy prices have not increased in any significant way in your neck of the woods given that Europe is suffering a massive energy crisis, but it would explain why my recent guests from California were totally unaware of this issue even though it makes headline news every day in the UK.

If you don't believe me, the information is available on our parliament website: https://commonslibrary.parliament.uk/research-briefings/cbp-9491/

"The energy price cap increased by 12% in October 2021, 54% in April 2022 and is due to increase by 80% in October 2022 (gas by 91%, electricity by 70%). A further large price rise in January is also widely expected."

The BBC has reported that the average household will be paying £3,549 per annum from October (my energy supplier has also confirmed that my bills will be around this level), which means that around 40% of households will be thrown into fuel poverty. Many people are planning to simply go without heat this winter and, as I am sure you know, heating is a necessity during UK winters.

There are also predictions that, from January, the average household will be paying £5,386 per annum, with further price rises occurring after that. If these figures are correct, the majority of the population will experience fuel poverty.

I can totally see why many hosts are considering simply shutting down for the colder months because, if you cannot charge prices that cover these costs, what is the point? I don't agree that making $1 profit is better than $0 profit unless you are also factoring in a living wage for the host for the hours they spend on each stay. Even then...

It's not just energy. My water bill went up £100 and I expect that to rise further. Rents have gone up. My cleaners put up their fees substantially because they also have to cope. We are experiencing high inflation and everything is becoming more expensive, even toilet paper. I am not joking. 

Even if the competition is not yet thinking of increasing nightly rates because they are scared of losing bookings, sooner or later they will need to or they will need to shut down, unless they already had a high enough profit margin to cope with these increases. I know that I do not.

[Gordon0]

If prices haven't changed in the USA @Richard531, that's perhaps the reason why many of my guests from there need to be reminded (almost daily) that it's not OK to leave the lights on all day while they're out!

And like @Huma0 says, it's affecting everyone, and I'm having to pay my cleaners more too.

It's so sad that some really don't give a hoot about energy prices, less so the fragile environment we live in.

[Huma0]

@Gordon0 

When I mention the energy crisis to guests, almost all of them stare at me with blank faces as if they were totally unaware of it. It's not just the American guests, although I have to say they are generally the most wasteful when it comes to energy and in particular the recent guests from California that I've hosted. I am not sure why that is.

While I do not expect my guests to spend the winter freezing in their rooms, I don't think it's a big ask to turn the lights off when you go out or wait until you have more than a couple of t-shirts before putting the washing machine on or turning off a tap, or closing the fridge door! Yet, as you say, they have to be reminded daily.

When I was growing up, no one talked about climate change, but it was normal to turn off lights when rooms were not in use. These young people have grown up with it being frequently discussed and many of them even have the topic included in their schooling, so I would have hoped that they would be much more aware and conscientious about energy use, but I have found it to be the opposite. One of my guests is extremely wasteful of both energy and water and makes has to be reminded to recycle/separate her waste. She works in ocean conservation. 

[Emilia42]

@Huma0 "These young people" .... I hear you. "Conserving" comes naturally to me and it is total common sense. When I'm cold, I don't turn on the heat, I put on a sweatshirt! We use heat in my house ONLY when the cold temperature puts the house at risk. (ie. damage from frozen pipes.) I can live on the uncomfortable side if it means I'm conserving. I am shocked at the number of Airbnb guests who have turned on the heat this summer when the temperature inside can be fully controlled by opening or closing windows. So much so that I physically had to shut off the furnaces. These are all people driving around with "Save the Planet" bumper stickers. It feels like the reality of those "committed to fighting climate change" begins and ends with their selfies next to the instagram-able dead turtles on the beach.

[Huma0]

@Emilia42 

Even if we totally forget about this from a hosting or cost perspective, this makes me want to cry.

If young people who have had the privilege of education and have the privilege of choice and the information that makes them aware enough to want to put up that 'save the planet' bumper sticker/post dead turtles on their Instagram do not give enough of a **bleep** to change their habits, then what hope is there?

I hear plenty (though maybe not enough) people of my own generation fret about what kind of state we are leaving the planet in for future generations, but will those future generations even care until it bites them squarely and very severely on their own personal backsides? 

In the mid-2000s, I worked as a campaigner and lobbyist for climate change issues and specifically for an organisation that was trying to educate people about reducing their energy usage. If you had told me then that nearly 20 years later, that these 'educated' young people would be behaving in this way, well I think I might have quit my job there and then, because I would have thought, "What's the point?"

It saddens me how little we have moved on.

Well, actually, the world has moved on, but in a different direction. The rise of social media and the 'look at me' culture we live in means that it's apparently more important to 'talk the talk' than to 'walk the walk'. 

[Emilia42]

@Huma0 

Exactly. I think it has a lot to do with people refusing to take reasonability for themselves. For example, there is a young student I know (21 years old) who is part of a social justice group that made simple printed signs with facts and quotes around different issues. He was bringing them around to local businesses to possibly hang up. I chose a sign with a fact about how Americans on average throw away 4.4 pounds of trash per person per day! Something that I am very conscious about. I hung the sign next to the coffee drink menu. It's been there for over a year now. This student comes into the shop regularly for a latte which I continuously make for him in a throw-away cup with a throw-away lid and, at his request, a throw-away sleeve. Just the other day, he said "I'm happy you're still displaying my sign!" To which I said, "Now if only it would persuade you to bring in a reusable mug!" He gave me a confused looked and basically said Huh? I'm one of the good guys. As if merely believing in climate change and conservation is enough. There is no other action required other than being "on the right side." And then all the blame and responsibility is passed on to big industries, governments, lawmakers, etc. They are the ones that must do something!

[Huma0]

@Emilia42 

I want to say, "Oh no!" but, at the same time, I am hearing myself say, "Oh yes, I recognise that completely."

Ms ocean conservationist not only leaves her lights on when she goes out (well, I think she has stopped that now after I reminded her several times) but is probably the most wasteful in terms of water that I have ever seen...

Still, I hoped that she would at least be conscious about recycling etc. because she specifically told me (proudly) that she works in ocean conservation, so she's "all over that". This girl not only does not recycle a thing and hasn't separated ANY of her waste in the month she's been here, despite reminders, but is constantly throwing away piles of food. I really mean piles of it. She chucks out a load of food and then goes and buys some more... from the farmers' market. SMH. 

I am starting to lose my faith completely in future generations. The behaviour seems to be getting worse to me than better.

What else can you say to stupid coffee cup guy? He clearly does not get it at all...

[Sybe]

Hey @Huma0 @Emilia42 ,

Just a friendly reminder that we remain respectful towards everyone, also younger generations even if some people aren't as environmentally aware as we'd like. 😉

[Huma0]

@Sybe 

No disrespect intended. If I didn't like younger people, then I wouldn't voluntarily be sharing my home with them (more than 95% of my guests and the many lodgers I rented to for years before that have been 18-30 years old, with early to mid 20-somethings being the most common). 

My comments were based on fairly extensive experience of living with younger people and observing their habits when it comes to energy efficiency, water usage, recycling and food wastage etc. 

My point was that it is sad that a generation that is far more exposed in terms of both media coverage and even their formal education seems to me to be even more careless when it comes to these things than my own (now middle aged) generation. Being someone who cares about these things, I was hoping for a change for the better!

Of course, there are exceptions to this, but the key word here is 'exception'. Perhaps younger people feel that there is no hope anyway... When I was a teen or in my 20s, we were not reminded daily that the world was about to end due to climate change. We thought it was going to end due to nuclear war.