Choose the right price for your Airbnb listing and never have to touch again right? Wrong!
If you’re not adjusting your pricing regularly based on competitive trends, seasons, and special events, then you’re leaving money on the table.
Here are the most common mistakes made with Airbnb pricing.
Not Using Automated Airbnb Pricing
Powerful Automated Airbnb Pricing Tools help Airbnb hosts earn up to 40% more revenue. These services have algorithms that can detect the slightest change in your local Airbnb demand and then they price your rental for maximum income.
These services take into consideration a ton of factors including:
- Special events
- Weekday vs. weekend
- How far out the booking is
- Hotel prices
- Your competitors prices
- Local occupancy rates
…and so much more.
They help protect your Airbnb business from nearly all of the mistakes I will name below.
Pricing Too High Too Early
You need your Airbnb pricing well below the market price initially to capture the initial bookings.
When you first list your unit, especially if it’s your first unit, you have little credibility with the Airbnb guest community.
It’s difficult to compete against established hosts and units that have 10’s or 100’s of reviews.
Pricing Too Low Too Long
After you build up your reviews, you’ll need to raise your prices accordingly.
While yes, it feels nice to be fully booked out for the next 3 months, your very high occupancy that far into the future only means one thing…your unit is priced too low and you’re missing out on profits.
Raise prices until you are about 75-90% booked 2-4 weeks out, but are only 50% booked 8-10 weeks out.
Pricing the Same for Weekends & Weekdays
If your weekend and weekday Airbnb pricing is the same, you’re NOT doing it right.
There’s a reason why hotels have higher weekend rates–the demand for staying at that time is higher.
Look at hotel rates and other competitor Airbnb unit rates in your area and compare their weekend vs weekday rates to establish a starting point for your rates.
Pricing the Same Throughout the Year
There is usually some seasonality for travel demand to an area.
Knowing when it’s high vs low season can help you adjust your pricing to maximize your profits and bookings through out the year.
Pricing too high during low season will hurt your occupancy rate. Pricing too low during high season equals missed profits.
Not Factoring Special Upcoming Events
Special events that are popular often book out well in advance, so keep an eye out on your local event calendars for things like sporting events, concerts, conferences and more.
Bookings for these types of events can often command 2-5X the normal nightly rates. So if you’re booked up at your normal rates, you’re SERIOUSLY missing out on profits.
Airbnb Pro Tip: You can easily maximize rental revenue with dynamic pricing tools, which use large amounts of data to automatically price your rental right, every night of the year.
I highly suggest checking out an automated Airbnb pricing service like Wheelhouse so that you don’t miss out on a perfectly priced listing.
As you may know, automated pricing can NOT be a one-size-fits-all type of solution because hosts have many different motivations and mindsets.
Our favorite feature of Wheelhouse is that their pricing algorithm can be personalized for your type of hosting strategy.
Maybe you want to be a bit more conservative on regular prices, and a bit more aggressive on picking up those last minute bookings…Wheelhouse can do that for you.
Check out their product here to see how it can amplify your Airbnb revenue.
Good points here. We’ve actually written up some insightful tips on pricing as well, from the perspective of a former Airbnb market manager, care to exchange posts?