How to Accurately Price Your AirBnb Listing
The million dollar question that everyone wants to know is: how much should I be charging per night??
Because of the fluctuations in the travel industry, there is no "one" price that you should set-it depends on many factors that you should consider. I recommend that you calculate a "base" price and adjust accordingly from there. A few guidelines when creating your nightly price: always consider the type of space you’re offering, the rates for OTHER similar airings in your area, special events, seasons, high/low travel times, and your personal expenses. Yes, you want to make a profit and cover your living expenses; however, when you start hosting and lack quality reviews, it’s always a good idea to price yourself slightly lower than the competition. By having a few reviews on your page, it shows potential guests that you are a reputable host and have your sh*t together! Let's expand upon other ways to help you accurately price your rental space.
Do your research!
Go into the travel part of AirBnB and type in your hometown (with the same number of bedrooms) and see what pops up. What are the prices for the other listings? Are they offering similar amenities (parking, WiFi, etc)? Use these listings as a starting point.
Make a month budget of cost of living expenses
Include mortgage/rent, HOA fees, parking, gross estimate of utilities, cable/internet, and Netflix/Hulu subscriptions. Add them up and divide by 30 days; that’s a rough estimate of your base nightly rate. Your pricing needs to exceed this amount in order to gain a profit.
Keep smart pricing tool on (if you don’t know where to start)
And always adjust for high travel times. Keep informed of your city's events, festivals, sporting events, concerts, and conventions. Raise your prices appropriately during these times when you know people will be traveling and need accommodations. You are able to book 3, 6, 9, or 12 months in AirBnB availability settings (under Host Dashboard-->Calendar-->Availability). BTW-Smart Pricing only prices your calendar out 90 days.
Check nearby hotel rates
Try not to exceed hotel prices unless you’re offering a large space, like an entire home. Most AirBnBs are less expensive than hotels; this is usually an attractive draw to potential guests.
A good rule of thumb is: if you’re booked for more than 3-4 months in advance, chances are your prices are too low. You should only be booked out 6-8 weeks in advance and that’s what your calendar should reflect. Anything other than that, your prices are too high.
AirBnB allows you to give special discounts for those who book for weekly or month-long stays, and you can set these discounts yourself. Sometimes I send special rates to students or long-term guests (as long as it covers my monthly budget). Always refer back to your expenses and make sure you are being compensated for your time and the effort you put into running a successful AirBnB.
If you're still not sure where to start, there are hundreds of pricing apps and third parties that will help find the best rates for you depending on your location, amenities, spacing, etc. If this is part of your budget and something you want to look into, check these out.
It’s not difficult to make a profit from your AirBnB, but it does take time and effort to establish a reputation as a quality host. AirBnB prides itself on offering accommodations that are safe, affordable, and high quality, and it rewards you when you meet its standards. Once you've earned a few reviews, slowly start raising your rates; you’ll find that people still book with you because they like what they see AND read about your listing.