How to Price Your Airbnb Rental Property
Maximizing occupancy and ultimately profits depends highly on your pricing strategy for your Airbnb. There are a number of things you’ll want to keep in mind when setting your prices:
How Many Guests Can You Host?
The number of guests you host will help increase your nightly rate, but note that there are risks to cramming too many folks into a space. One, more people means more of a chance for something to go wrong (think - parties, damage, toilet issues, etc.) Secondly, if you state that you can sleep 8 but your space is really only big enough for 4, you’re risking getting unhappy reviews from guests. On rental platforms like Airbnb, you can usually set a maximum number of guests and then add on guests for additional charges if you are trying to deter too many people from staying at your property.
Weekend vs Weekday Pricing
Of course, there will be differences between weekend and weekday pricing. On rental platforms you can typically set a weekend rate and a weekday rate; we also consider surrounding holidays and manually update for 3 day weekends as well. We always keep the following points in mind when thinking about the time of year for our pricing:
School vacation weeks: not just for the state you’re renting in, but also surrounding states. Our rental is based in the White Mountains in New Hampshire and we have not only guests from NH but also surrounding states in the New England area.
Slow months: We’re lucky enough in New Hampshire to be booked year-round, but our slower months are March and November. We drop our pricing during those months to maintain high occupancy.
Dynamic and Recommended Pricing
Rental platforms like Airbnb will update your pricing based on demand. You can set a max and min price, and Airbnb will take care of the rest. That said, we’ve found AirBnB’s dynamic pricing to understate the market, and as a result, we’ve kept our pricing relatively stable. We also find guests don’t understand why the prices each night fluctuate.
Cleaning Fees
After you’ve found your Property Manager or someone to help you upkeep and turnover your property, you’ll want to set a cleaning fee. Guests pay your cleaning fee directly to you, and then you pass that on to your cleaner or Property Manager. Do your research on cleaning fees in the area, and make sure your Property Manager is bought in on the fee. Other considerations include whether or not trash needs to be removed, and if you’re allowing for pets (which could require extra time for cleaning).
The “Other Fees”
Don’t forget - the whole point of using Airbnb/VRBO/HomeAway’s platforms is that they are promoting your space on a massive search engine for guests, and that comes at a cost. Your guest will be charged a commission for booking through those platforms, and then you will also be charged a service fee. All said and done, once those fees plus taxes and your cleaning fees are added on, your guest is paying a lot more than your stated nightly price.
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