Airbnb Smart Pricing – Smart for Airbnb, Dumb for Hosts

Your Airbnb pricing strategy is the one factor that will make or break your vacation rental business. One of the keys to your success in running profitable rentals is pricing correctly. A lot of hosts make the mistake of pricing too low, or worse, using Airbnb Smart Pricing. The key indicator of this is that their calendar is full months ahead of time. They proudly brag about their rental’s success, but they don’t realize one huge thing. They are earning way less than they could be.

Airbnb Smart Pricing Fills Your Calendar

But is that always a good thing?

Some people might not even think to ask this question. The answer is not a simple one, and that is: it depends. If your calendar is full a few weeks out, that can be a good sign. However, if you are booked entirely for the next 90 days, you might not be charging enough. Most vacation rental bookings happen less than 30 days from the date of check-in. So, if you are booked a large amount beyond 30 days, maybe your listing is just that awesome. But it is far more likely your Airbnb pricing was too good a deal for guests to pass up!

Top Airbnb Smart Pricing Strategy Mistakes

• Flat Pricing. Hotels and airlines don’t set flat rates throughout the year and neither should you. Vacation rentals in most places are highly seasonal. Your pricing should go up during times when your listing is much more likely to be rented. Similarly, your pricing should go down to encourage bookings during times of decreased demand.
• Charging Per Guest. In a lot of cases, charging per additional guest beyond a certain number is a bad idea. It adds a variable that makes it hard to track whether or not your pricing is effective. Perhaps your listing is dirt cheap when you book it for 4 people, but outrageously expensive when you add 2 more. There are only certain situations where this is a good method, but most beginners should avoid this setting. Some guests may not be upfront about the number of guests actually staying when faced with more fees. It can be hard to recoup this money from Airbnb’s Resolution Center, even when armed with solid evidence.
• Airbnb Smart Pricing. While it is better than flat pricing, Airbnb’s Smart Pricing has proven to be very unreliable in our experience. It is in Airbnb’s best interest to book your listing as much as possible rather than not at all. This means they will lower your prices to make sure that you are booked as much as possible.
• Not Watching the Competition. One of your most powerful tools for pricing correctly is checking your competition’s Airbnb pricing. Some hosts are not realistic about what their listing’s actual value is. Activate your browser’s Incognito Mode or Private Mode and see where your listing lands in the search results. Use the maximum number of guests your listing can accommodate in the search results. Take note of listings similar to yours in size and amenities. What they charge and where they rank are very important.

The Ultimate Airbnb Smart Pricing Strategy

There are multiple Airbnb pricing platforms with which you may have better results. In our experience, Wheelhouse and BeyondPricing have been the most successful. Wheelhouse offers slightly lower fees and has better results. A good pricing app will give you a good benchmark to see how you’re doing. In the case of Wheelhouse and BeyondPricing, each gives you a score out of 100 to see how you’re doing. Both apps recommend a starting base price to you, but Wheelhouse offers superior flexibility and automatically adjusts your base price as it sees fit. Fine-tuning the base price is necessary to ensure success.

How Do I Assess My Pricing?

Your pricing has a huge impact on your Airbnb search result ranking. This is the most important component of vacation rental success. If no one can see your listing, they can’t book it. Airbnb’s algorithm makes its own determination on whether your pricing is a good value or not for any given date. You can check your ranking by searching for your own listing.

How To Find Your Listing

The trick to finding your listing is to first activate Private Browsing Mode or Incognito Mode on your browser. Otherwise, Airbnb will usually show your listings at the top of the results and other people might not be seeing it that way. When you search for your listing you’ll want to search for specific dates and always use your maximum guest occupancy.

It’s important to search for the location that the most guests will be searching for when they find your listing. Instead of Los Angeles, narrow your search to Hollywood because you probably won’t want to price competitively with the entire city. Once you run the search, take note of what page your listing is on or how far you have to scroll to find it. Do you have to do this every day? No! One of our favorite hosting tools, Hospitable (formerly Smartbnb), will do it for you. Check out our article here that gives the full rundown on Hospitable.

Help! I Can’t Find My Listing

If you’ve gone through a lot of pages and can’t find your listing, then chances are you are either looking at dates too far in the future, or your Airbnb pricing is too high. Read the next section before making any decisions on what this means for your listing.

Why Does This Ranking Matter?

Now that you know how to figure out your ranking for any given date, let’s look into what this means. If you are looking at dates more than 90 days away, you don’t want to see your listing anywhere near the first page. If you are looking at dates a few days from now, you want to be toward the top of the search results.

People won’t look through too many options before making their choice, so visibility is very important – especially when the clock is ticking. Our rule of thumb is we want to be on the page corresponding to how many weeks away the dates are. So if the date is two weeks away, we’d be happy to be on Page 2. Page 2 allows us to have a slightly higher price while still having a very good chance of people finding us.

More on Search Ranking

Search ranking is extremely important and relies on a combination of many different factors. While we touched on how it relates to Airbnb Smart Pricing here, there are many more ways it can be affected. It is highly recommended that all hosts, both new and advanced, check out our article on search rankings.