One area that sets the most successful Airbnb hosts apart from the crowd is their pricing strategy. Pricing your listing is critical. Strike the balance between offering your guests good value, being competitive, and maximizing your rentals’ profits and you’re onto a winner. The short-term rental market is a highly variable one, however. In order to avoid the common pricing mistakes most Airbnb hosts make, attention has to be given to a wide number of fluctuating factors.
Here are some ways you can set your rates to increase revenue on your listing.
The biggest factor determining your property’s worth is its location. A penthouse in Paris will command more than a similar listing in Seattle. Likewise, what your property can offer guests in terms of amenities will also play a big part. However, rental demand in every city, state, and country can also change like the wind. Watch closely your local market and detect even the slightest shift.
These fees for the little extras can quickly add up. They can make up for a lower-than-average nightly rate and contribute to increasing your overall profits. Cleaning, for one, is an often overlooked add-on when creating a great Airbnb listing. Whether you do it yourself or hire some help, cleaning can be costly and time-consuming, so make sure you’re compensated for it. Your fee will generally depend on the size of your place, so consider what’s reasonable.
People like to travel with other people, and charging a fee for extra guests is a wise way to increase the profitability of your property. Even if you place is no mansion, giving the option to pay for additional guests will give you the opportunity to earn more on your listing. Fees can also be applied for late check-in, pets, and bike rental.
Implement a pricing strategy that takes into account the fluctuating demand for your property throughout the year, month and week. Airbnb provides the option to adjust rates for each day, so take advantage of it. Is your property near a popular beach or a snow-coated ski resort? Consider the seasonal climate – factors such as the weather and temperature can play a huge role in a destination’s draw.
Demand can also increase substantially around special events such as concerts and sporting events, so keep an eye on what’s happening in your city in order to forecast anything that could potentially boost demand for Airbnb properties in your locale.
Evaluating your competitors can give you a foresight into their pricing strategy. Take note of their rates as well as any fees for cleaning, extra guests, and so on. If you really want an advantage over your competitors, keep an eye on listings in the immediate area and search for properties with the same amenities as yours. Try to gauge their popularity, vacancy rate, and quality of hosting. Gather as much information as possible and compare it to your listing. Are their photos better? What do guests like about their place? Can you offer that, too? Compile relevant information, review and analyze it, and adjust your rates accordingly.
There’s no doubt about it, the social proof gleaned from outstanding reviews can vastly increase rates that your property can demand. As you wow each of your guests with your impeccably kept rental and super helpful hosting, the superlative reviews will roll in and your reputation will rocket. This is a good time to raise your rates and capitalize on your happy guests’ kind words. If you happen to get any bad reviews, heaven forbid, then read this and calm down.
When it comes down to it, there are certain tasks that a computer program can tackle that a human can’t, and consistently running complicated algorithms and analyzing the results to adjust prices on any number of Airbnb listings is one. If you want to maximize your rental earnings, you’ve eventually got to let a computer study the market for you. You can avoid many needless hours and earn up to 40% more by utilizing sophisticated pricing software such as Beyond Pricing, the world’s most popular revenue management and pricing software for vacation rentals. You see, every day, Beyond Pricing leverages big data predictive analytics and machine learning to set prices based on seasonality, day-of-the-week, major local events, hard-to-book days, and last-minute availability. It does all this so you don’t have to. In order to judge the price that will prove to be the most profitable for your property, Beyond Pricing uses refined algorithms and advanced real estate analytics. With that said, you will only have to trust the experts. If you are interested in automatic pricing, you are welcome to benefit from a special offer below.
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Do not underestimate any of the above-listed points and get most out of your Airbnb pricing strategy.