More than ever, seeing the rate you’ll actually pay from the start matters – a lot.
In cities like New York, travellers are presented with rates of $150 per night, only to find out that the figure doesn’t include nightly taxes of nearly $50, and also “resort fees” up to $45 per day in addition. Suddenly, that $150 per night becomes $235, and a$300 all in stay for two nights is peaking to $500. It’s frustrating, and inevitably leads to clicking away and starting again.
Recognising this important trend, Airbnb has launched a new fee structure, which could make the game changing experience of home sharing even more appealing…
When you make a booking with Airbnb, you’re hit with a “guest fee” of 20%. It turns a great rate into a good rate. At the same time, hosts also pay a 3-5% fee to Airbnb for commission. Starting June 4th, 2019 people who manage Airbnb listings will have the option to switch to a new Airbnb fee structure charging a flat 14% fee which includes guest charge and the Airbnb commission. It’s basically a single fee that covers things in a clear and concise manner.
The first thing to note is that this isn’t mandatory for any present listings, and the second is that it won’t apply to America, at least not yet.
The move affects properties in Europe, Middle East, Africa and Asia with the exception of Japan. Basically, a host can still list their property the way most are currently seen, where you see a “nightly rate” but don’t see the actual rate with the 20% and other fees added in until a later booking stage.
Why a host would choose to frustrate guests by not showing the all in price from the start would elude many minds.
Some might say that the guest fees are not in fact being eliminated, but instead repurposed. In a way, that’s fairly true, but considering that Airbnb will earn an effective 14% cut on bookings versus 25%, it is a strong way to bring even more on boarding to the platform while becoming more user friendly for price conscious travellers who just want a true price.
Make no mistake: no one is saying Airbnb rates are necessarily going to drop. What people are saying however is that you may see a rate much closer to what you actually pay, from the very start.
In a way, the rates may technically jump, as hosts bundle the 14% into their base price, but on the other hand, we as consumers just want to get to that final “what do I owe you”, and this is an extremely significant step. If a host jumps their listing up 14% to cover the new fees, that’s still 6% lower than the 20% consumer currently pay.
This move (effective tomorrow) comes at a fascinating time, as hotel “resort fees” have spread in epidemic fashion, even in urban centres where the idea of a “resort” is anything but. The more people hate resort fees and lack of transparency, the more it will push the sharing economy to go the other way. At least, with any hope.