Research, experimentation key to finding the right price for your Airbnb rental

 

Carolyn Hocquard wanted to make some extra cash to cover rent, when her mom moved out of their downtown Halifax home four years ago.

So the social media and web design worker did what thousands in the country have done: rent their place to visitors for short stays using Airbnb.

But before Hocquard could open her two spare rooms to travellers, she had to work out what to charge — a process that can be fraught with emotions and conflicting advice.

Airbnb, she says, suggests rates and offers a tool that lets hosts set their prices to automatically go up or down based on changes in demand.

Hocquard, however, recommends Airbnb hosts search other properties in their area to get a sense of prices and use them as a benchmark.

“I started low to get going and then I just continuously raised the price periodically,” she says.

Hocquard, who credits Airbnb with helping her save enough to buy a property, began charging $35 per room per night, but now her lowest price is $55 and her highest is $80.

When she was experimenting with what to charge, she would raise the price by $5 or $10 to give herself insight into what people will pay and when.

Hocquard will sometimes offer a discount — usually around 10 per cent — to people who book a longer stay.

When toying with prices, Hocquard says to keep in mind that Airbnb takes a percentage of every booking.

Hocquard only has two rooms, which she rents separately, but hosts with more space can charge more, she says. Unusual properties like treehouses, villas, castles, geodesic domes and even planes or boats are known to fetch a premium.

Hocquard recommends hosts also take advantage of timing.

“A lot of people will lower the price at the last minute… to try to fill it up. I actually do the opposite,” she says, noting many people book stays the day they want to check in. “I wait until I get like 70 per cent full (for the month) and then I raise the price a little bit on the remaining days and then at 80 per cent full I raise the price on the remaining days again.”

Hocquard says the strategy works because people who are scrambling at the last minute to find a place are often willing to pay more.

It’s also a good idea to capitalize on busy seasons — summer holidays, spring break or large festivals and events that will draw visitors from out of town.

“August is the busiest month for me so I will raise those prices way in advance,” Hocquard says.

She also builds in time to spruce up her place. She closes her home to Airbnb in January, February and March to redecorate and prepare for the upcoming season.

Sometimes she gives her Airbnb posting a facelift too, adding details about the organic cotton sheets and unscented laundry detergent she offers.

“Just be as descriptive as possible in the listing,” she says. “The name of the game is just setting expectations.”

This report by The Canadian Press was first published Nov. 12, 2019.

Tara Deschamps, The Canadian Press



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