Airbnb Host Fees: What You Need to Know
Airbnb charges a host a service fee for each booking made through the site. The fee covers operational costs, such as customer support, secure payment processing, and development of new features.
What Percentage Does Airbnb Take From Hosts?
The percentage Airbnb takes from hosts typically ranges from 3% to 16% of the booking subtotal (nightly rate + cleaning fee + additional guest fee, excluding taxes and Airbnb fees). The actual percentage a host will be charged depends on the chosen fee structure and cancellation policy.
1. Host Service Fee
Airbnb offers two primary fee structures for hosts: the Split-fee and the Host-only fee.
Split-fee
The Split-fee structure is the most common option. Under this model, the service fee is split between the host and the guest.
- Hosts typically pay around 3% of the booking subtotal. The percentage is higher for hosts who have opted for a Super Strict cancellation policy or have listings in specific locations, like Italy.
- Guests pay a fee of approximately 14% of the booking subtotal. The percentage can vary based on the length of stay, the booking’s location, etc.
Host-only fee
The Host-only fee structure is a more straightforward option, where the host pays the entire Airbnb commission. The fee ranges from 14% to 16% of the booking subtotal.
- The Host-only fee is mandatory for traditional hospitality listings, such as hotels and serviced apartments.
- The Host-only fee is required for hosts who use property management systems (like channel managers) to manage listings across multiple platforms.
2. Value-added Tax (VAT) and Other Taxes
Airbnb or the hosts collect taxes in certain locations and remit the taxes to the appropriate authorities. The service fee is typically VAT-inclusive in these cases.
Airbnb Guest Fees
Hosts bear the brunt of Airbnb’s service fees, but guests sometimes pay additional charges when booking a stay. Hosts often set the fees and include:
1. Cleaning Fee
The cleaning fee is an optional charge that hosts can add to the listings to cover cleaning costs. The fee is set at the host’s discretion and is separate from the Airbnb service fee.
2. Extra Guest Fee
Many hosts impose an extra guest fee for additional guests beyond a specified number. The fee is normally charged on a nightly basis and is determined by the host.
3. Security Deposit
Some hosts require a security deposit to cover potential damages to the property during a guest’s stay. The amount is not charged upfront but is held by Airbnb and released to the host if a claim is made within 14 days of the guest’s checkout.
4. Cancellation Fees
A guest canceling a reservation is subject to a cancellation fee, depending on the timing of the cancellation and the host’s cancellation policy. The fee varies based on when the cancellation occurs relative to the scheduled arrival date.
Strategies for Managing Airbnb Fees
Managing Airbnb’s fees while maintaining pricing and profitability can be a delicate balancing act. The top strategies host employ are as follows:
1. Build Fees Into the Costs
Understand all the costs of running a vacation rental property before setting the prices. The costs include Airbnb fees, cleaning costs, maintenance expenses, and any other relevant outlays. Understanding the costs helps a host set a price covering the expenses while leaving room for a reasonable profit margin.
2. Stay Competitive (Even Against Non-Hotels)
Now, hotels use the simplified pricing model, meaning vacation rental property hosts operate on a level playing field. However, hosts need to consider non-hotel Airbnb listings in the area.
Look at what other competitor hosts are charging and compare amenities, location, and overall value proposition. Adjust prices or find ways to add value to your listing, because the higher the value a property has, the higher the price a host charges.
3. Don’t Be Afraid to Switch Things Up
Airbnb’s fees for properties are constant, but a host’s pricing is dynamic and responsive to changes in seasonality and demand. During low seasons, drop prices to drum up bookings and attract repeat guests during the more profitable high seasons.
4. Maximize Add-Ons
Airbnb’s fees are based on nightly rates and any extra fees, like cleaning and additional guests. Still, more revenue streams are available to hosts. Consider offering additional services and amenities not subject to Airbnb’s fees, such as airport pickups, guided tours, equipment rentals, or breakfast packages.
5. Stop Relying Solely on Airbnb
Diversifying booking channels reduces a host’s reliance on a single source of income. Commissions and fees are a reality for nearly all online travel agencies (OTAs), but not all charge the same rates or use the same fee structures as Airbnb.
Channel managers, like Rental United’s, allow you to distribute your listings across a a variety of 80+ OTAs and specialist channels while automating and avoiding double-bookings.
Successful vacation rental businesses also ensure that a business retains the full revenue and profit from every reservation. Consider building a direct booking website (one option for this is our Website Builder where you can create your own website in just a few clicks) The platform showcases a host’s properties across multiple platforms, reaching a wider audience while minimizing commission fees.
Finding the Perfect Balance
- Airbnb charges hosts a service fee ranging from 3% to 16% of the booking subtotal, which depends on the fee structure and cancellation policy.
- The Split-fee structure splits the service fee between hosts (around 3%) and guests (approximately 14%), while the Host-only fee (14-16%) is paid entirely by the host.
- Guests incur additional charges, like cleaning fees, extra guest fees, security deposits, and cancellation fees, set by the host.
- Build Airbnb fees into a property’s costs, stay competitive, adjust pricing based on seasonality, maximize add-on revenue streams, and diversify booking channels to manage Airbnb fees effectively.
- Focusing on direct bookings and using channel managers minimize commission fees and grow a vacation rental business.
FAQs
1. Can I avoid paying Airbnb fees entirely?
It’s impossible to bypass Airbnb’s fees entirely when listing on the platform, but alternative booking channels with different fee structures are available on the market. Building a direct booking website helps hosts accept bookings without paying commissions to OTAs like Airbnb.
2. Do Airbnb’s fees include taxes?
No, Airbnb’s service fees do not include taxes. A host collects and remits the taxes to the appropriate authorities or Airbnb carries out the task on the host’s behalf.
3. Are Airbnb’s fees the same for all hosts?
No, Airbnb’s fees vary based on the location, the chosen fee structure (Split-fee or Host-only), and the cancellation policy. Hosts with Super Strict cancellation policies or listings in specific locations pay higher fees.
4. Can I change my Airbnb fee structure?
Yes. A host using the Split-fee structure but wanting to switch to the Host-only fee, or vice versa, can change preferences in the Airbnb account settings. Meanwhile, the Host-only fee structure is obligatory for a host using a channel manager or property management system.
5. How do Airbnb’s fees compare to other vacation rental platforms?
Airbnb’s fees conform with other major vacation rental platforms like VRBO and Booking.com. The fee structures and percentages differ, so research and compare the costs associated with each platform to determine the best pricing scheme. You can also contact us and we’ll be happy to help!