Here’s Why Airbnbs Cost More Than You Think – Smart Media Magazine

Here’s Why Airbnbs Cost More Than You Think


Anyone who’s been a click away from booking a short-term rental on Airbnb, only to realize that the final price has been jacked up by surcharges, has probably been frustrated by how the platform displays prices. In fact, Airbnb’s pricing has drawn scrutiny from European regulators, who in July accused the company of engaging in deceptive advertising practices.

And though Airbnb told BuzzFeed News it started rolling out a tweak to its pricing interface on desktops in most markets over the last few weeks that includes the total cost of booking in search results, customers are still confused. Even with the change, which is not currently on mobile, the lower nightly price is still more prominently displayed than the higher total cost. You also have to enter the dates of a trip to see the total, you can’t filter searches by total cost, and cleaning fees can nearly double the cost of some bookings.

Consumer regulators in the US haven’t pressured Airbnb to make its pricing more clear. But in September, the European Commission announced that Airbnb planned to comply with orders issued in July to change its pricing advertising. At the time, Airbnb committed “to presenting the total price of bookings, including extra fees, such as service and cleaning charges,” by the end of 2018. As of publishing, people in Europe searching for rentals on Airbnb see search results that list only the total cost.

Airbnb charges a service fee and collects local taxes, but hosts set the cleaning fee for their properties. Hosts can also choose to charge extra for additional guests. While Airbnb said the cleaning fee isn’t supposed to exceed a certain percentage of the nightly cost of a room, if a guest is only staying somewhere one or two nights, that cost can seem absurdly high. The company did not specify what that percentage is.

Airbnb guests are only charged a cleaning fee once per trip, while the nightly price is charged for every night booked, so displaying the cleaning fee separately in the total cost breakdown can help guests figure out how long of a stay they can afford. Other short-term rental sites, like VRBO (aka Homeaway), use a similar system. But while hotels do break out taxes, the cost of cleaning is usually folded in to the nightly price. (Recent hotel strikes over contract negotiations suggest that cost might need to go up soon.)

The inability to filter Airbnb search results by total cost of the booking was a problem for British musician Chris Reed. On a tour in the US last month, Reed was trying to save money by searching for Airbnbs to stay in that cost £80 or less per night. “Once Airbnb added the cleaning fee, it was sometimes as much as double,” Reed told BuzzFeed News via Twitter DM. “How people can justify charging £58 cleaning fee for a £70 room over a one night stay I don’t understand, but this was not rare to find.”

Searching for Airbnbs he could afford ended up being so time-consuming, Reed reverted to booking hotel rooms, which he found faster and more consistent.

David Sawyer, a Georgia-based software developer, also had trouble with Airbnb’s pricing interface. “I was looking for a place to stay in Europe, and I’d find these cheap places on the map, and I’d click one and it would double in price because I’d only stay a couple nights. It’s a bummer all around,” he told BuzzFeed News.

Frustrated by Airbnb’s obfuscation of the actual cost of listings, Sawyer built an extension for the Google Chrome browser that displays the total cost per night of Airbnb listings, rather than the per-night cost minus fees. The extension doesn’t fix the site’s price filter problem; it just provides the guest with an easier price point for comparison with other listings, or hotels. But it currently has over 6,000 users.

Sawyer said Airbnb’s decision to make a listing’s lower, nightly price more prominent than the actual total cost per night could be about the company’s bottom line. “This sort of tactic has been around for a good while, especially on the internet,” he said. “The further you can get someone down the funnel of transaction, or booking your place, the better off you’ll be and the more money you’ll make.”

But Will Smidlein, a California-based software engineer who tweets about Airbnb a lot, said pricing that feels like a bait and switch could hurt Airbnb’s relationship with users in the long run.

“People associate them with sneak[y] techniques to make [money],” Smidlein said via Twitter DM. As to whether the tradeoff in brand value for incoming business was worth it, Smidlein said, “I think short term yes, long term TBD. People didn’t care about Facebook using their data to target ads until it hit a boiling point.”



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