Thinking about advertising on Airbnb?
At Crown Gardens we pride ourselves in the work we carry out to ensure that all our guests have a relaxing stay in one of our high quality holiday lets in Brighton and receive good value for money, while our landlords know that their properties are well cared for and they can run a successful business.
Airbnb can seem like an attractive choice for landlords, cutting out the need for a letting agency. However, there are many reasons why sites that promote the 'share-economy' can do far more harm than good.
The dangers for landlords
Airbnb and copycat sites promise flexibility, maximum profits and a lot of bookings. This all sounds perfect for landlords, but after some time on the site you will find that you are making less money and have to do more work than you would with a reputable holiday letting agency.
The first point of consideration for a landlord is the cancellation terms. Anyone who owns a holiday let knows how damaging late cancellations can be to a business. In peak times a last minute unpaid cancellation can set you back a significant amount of money.
At Crown Gardens our guests are liable for the full cost of the stay if they cancel with under 28 days notice. Therefore if the landlord can not fill the space in that time they are not out of pocket. In contrast to this, if there is a cancellation, Airbnb will only refund 50% of the cost 7 days in advance This is a very risky business strategy for landlords.
Did you know that Airbnb doesn't actually collect any security deposits on your behalf? This can be very risky for you as a landlord. "Any guest who confirms a reservation at your listing will be responsible for damages up to this amount. No charges or authorisations will be made unless you make a claim within 48 hours after check out." Here at Crown Gardens, will not allow a guest to check in unless we hold a deposit - as a safeguard should there be any issues. This is particularly important for the larger group bookings.
The hidden costs
As a landlord it is important to make money while remaining good value for your guests. This is not as easy as it may seem with Airbnb. There are hidden costs that mean less money for you and your guests. There is a booking fee of 6 – 12% on each booking that goes directly to Airbnb, added on to the overall price of the booking. Airbnb then takes 3% from the landlord for each booking. These numbers may not seem like much, but on an average 2 week stay at peak time it is a significant amount.
As a reputable and legal short-let landlord you have a set of responsibilities and therefore costs. Insurance, fire safety, taxes etc. Your prices have to cover these costs. Holiday letting agencies, such as Crown Gardens, only promote legitimate landlords. Airbnb promotes whoever wants to make some quick money.
Your property will be listed alongside properties from landlords that don't have the same outgoings as you and you will soon feel pressurised to reduce your prices in order to attract bookings.
With Airbnb you will receive a lot of messages, but very few of these convert. Travellers how use the site are often after a last minute bargain. You have to vet all the groups yourself and you do not have the same assurances that you do with an experienced holiday letting agency that your property will be respected and looked after.
Before you list on Airbnb, or any similar sites, read all the small print and think about the type of business you would like to build from your property.
Posted 28th Sep 2015