What are host fees for vacation rentals ?
When you have found that perfect vacation rental with that perfect price per night, you may be in for a sticker shock when you actually decide to book especially on websites such as Vrbo.
Every online booking site charges a commission fee and a processing fee to list properties and process payments. Property managers are free to set the nightly rates and decide on how much to charge for ancillaries such as cleaning after you leave. But in is up-to the Online Booking Site on how the prices are displayed to the customer in the search results.
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Booking.com and Airbnb include the nightly rate and all the fees in their prices making it easier to stick to your budget. However, Vrbo lists only the nightly rates in the results, while the fees are added to the total after you hit the “Book” button. You do have the chance to scrutinize all charges before you consent to give them your payment information.
Perhaps, this is Vrbo’s way of being more transparent about all the charges and taxes you will incur beforehand and not worry about being surprised with a large bill on checkout.
- Please note that booking fees on vacation rentals are not the same as Resort Fees, which hotels charge for with no valid explanation.
An Example Booking Summary
| Description | Price |
|---|---|
| Price per night | $100 |
| Number of nights | 3 |
| Cleaning Fee | $100 |
| Service Fee | $56 |
| Taxes | $59.28 |
| Total | $515.28 |
The cleaning fee is a flat amount per stay as decided by the owner. Tax rates are set by the province or state the property is located and in this example, in Ontario which has a 13% HST.
The service fee is set by the booking website. This can be up-to 14% of the costs before taxes. In some properties such as on Airbnb, we have seen service fees as high as 20%.
Beware of Additional Guest Charges and superfluous fees
Property owners are at will to charge for any extras and set their prices. This is where dishonest owners will try to swindle you for more money.
The first thing they will try to attract you is with a low rate per night. But when you look at the booking summary, the cleaning fee, for example, may be set to something exorbitant. You may even see charges for utilities such as internet, water, electricity, air-conditioning, laundry etc.
It is like shopping for an item that is priced low but has extremely high shipping fees. Similarly, if the rate per night you see in the search results is too low, then it’s too good to be true.
Secondly, there is a practice amongst chalet owners and people who are renting out single rooms to charge for each additional guest. Just as before, you may see a low rate advertised in the search results. But in the booking summary, you will find that your spouse or partner is also being charged separately for their stay.
Below, I have attached an example of a booking summary of a chalet which advertised their room for $100 per night. However, my spouse is being charged an additional 90%:
Additionally a cleaning fee of $150 for a room seems quite high. But I did check that I got two or even three chalets, the cleaning fee remained unchanged.
However, the total price still seemed way off. A brand hotel by Hilton or Marriott would still have saved us more than $500!
Don’t ignore the reviews
When it comes to brand names such as Marriott or Best Western and even a small business independent hotels, you have an expectation and confidence in the service you will be getting.
With private home-owners, there is no telling because for some, this is supplementary income. If they get bad reviews and loose their privilege for listing their property on Vrbo or Airbnb, they may just put it up for long term rent.
But for business such as hotels and motels, this is not an option and they have to strive everyday to provide the best services and be able to pay their employees.
This is why reviews become so important when looking for vacation rentals. The more reviews showing satisfied customers, the better. When you contact the property owner, they should be able to get back to you in 24 hours or less and be able to answer all questions you may have.
Pay attention to negative reviews. If you see a single negative review standing out amongst a majority of positive reviews, you can safely ignore it or ask the property owner about it. But, if you see a pattern in the comments which are negative, then you may want to look elsewhere, because chances are that you too will have the same bad experience.
Summary
When looking for vacation rentals, do not pay until you are aware of all the fees you are being charged on your booking summary. Do not be emotionally attached to a particular location or a property because if you keep looking, chances are you will find something better with a better price.
Don’t forget to look at the reviews!
All the best!
