r/airbnb_hosts • u/shimmi44 • 1d ago
Vrbo Commission Changes
For everyone who was up in arms over Airbnb raising their host fees, just be happy you're not on Vrbo with Property Management Software integration. Next week, Vrbo is increasing their commission to 12% (which of course they claim is a benefit to hosts somehow and cheaper than their competition) but conveniently avoids discussing that guests still pay between 6% and 15% service fee (which is absurd that it's dynamic to begin with instead of a set rate). Then, if you are a property manager, you are responsible for processing the payment separately, so that's 3% to Stripe. So upwards of 30% total in commission and fees right off the top between guests and hosts. That's also not factoring in that because you pay Stripe directly for processing, that 3% hits the passthrough taxes as well, so you have to eat the 3% on that in addition to everything else. That coupled with their clunky platform, I'll gladly take Airbnbs and Booking.coms roughly flat 15% commission all day. Strongly considering just removing our listings from Vrbo all together. Hope everyone else is aware of the upcoming changes. Somebody please let me know if there's something I'm missing here, because I certainly hope there is some type of positive or misunderstanding here.
7
u/StinklePink Unverified 1d ago
I believe VRBO also as some new language that says if you are on more than one platform and you book a guest with someone other than them, on a different platform, they can penalize you. Something to tat effect. Pretty heavy.
2
u/shimmi44 1d ago
I saw someone mention that on the Vrbo page. I haven't personally found that, and have no clue how they would enforce that, but that's also crazy. And just to add other things that piss me off about them, if Vrbo doesn't handle the payment, and they invoice you like they do for us, nothing is itemized. They just send you a bill that says "we are charging your card $800," doesn't say what for. And even if you sit on the customer service line for an hour to reach a call center, they can't tell you either. You have to sit there and piece together spreadsheets to figure out what you're even being billed for. It's a joke.
5
u/idontcare3434 1d ago
With stripe, you are on the hook for processing fees even if guests cancel and get refunded too. So this is shit
2
u/ptinsley 21h ago
I had someone book THREE times and cancel back to back recently because they “used the wrong cards”
2
u/shimmi44 1d ago
AND we learned this the hard way; Because guests book with Vrbo, and then later see some random company they have never heard of charge their credit card, we get WAY too many charge backs. Mostly from guests who just had no clue what the charge was for because they assumed they paid Vrbo. Vrbo then says you received a charge back and they are reviewing it, but they actually don't do a single thing, they just give you false hope. So your best bet is to reach the guest after the fact and get them to agree to drop the charge back, and if they don't, there's no way to win that dispute.
3
u/SubRegIIoN 1d ago
I don't think you're missing anything. Before pulling the listings I'd go through your last few months of Vrbo bookings and figure out what you actually kept per night after the 12%, Stripe, and the processing you eat on the tax portion, then compare it to the same dates on Airbnb. If Vrbo is bringing guests Airbnb wasn't, raising the rate there or keeping it open on fewer dates might beat delisting. And screenshot whatever terms you accept next week, since nobody at Vrbo seems able to explain the invoices.
3
u/shimmi44 1d ago
Here's the kicker, Vrbo is also implementing a parity clause where they will suppress your listing in search results if their AUTOMATED system determines that you are charging more on Vrbo than other platforms. So even if you raise your rates, they will just prevent you from getting reservations (or even if a computer just thinks you are).
4
u/wasgary 1d ago
The possibly good news is that Expedia, VRBO’s parent company, just got sued for using parity clauses in its hotel listings in Expedia.
https://hoteliertimes.com/expedia-antitrust-lawsuit-rate-parity/
Unfortunately, VRBO owners can’t realistically sue because the terms of service for owners have mandatory arbitration and anti-class action provisions. Best option would be if the FTC got interested - they have a mega-suit against Amazon right now for its use of the same sort of parity provision for its third party sellers. VRBO doesn’t have the same market power as Amazon, but its 20% market share is close to the threshold for antitrust laws.
1
1
u/Informal_Pea8388 1d ago
Curious how these platform adjustments play out for new hosts like me just getting started
1
u/shimmi44 1d ago
Everything is more difficult and more expensive. More competition. Thinner margins because of all of that. That being said, just do a better job than your competition, and wait for the rest of them to close up shop. There's still plenty of money to be made, but it's not super easy money anymore. The markets will balance out overtime. Those at the top of their markets are still doing excellent.
1
u/Host4848 Unverified 8h ago
I guess you work for Airbnb, right? It’s like a marketing pitch for Airbnb 😂
1
u/shimmi44 8h ago
Definitely not. There's plenty to be frustrated about with Airbnb. But I just watched people complain about Airbnb for the last year about Airbnb essentially switching from 15% to the guests to 15% to the hosts. And how they are quitting Airbnb and switching to Vrbo. Meanwhile Vrbo is quietly switching to a total of 25%+ while claiming they are the cheapest platform in town. Moreso want people aware of the bullshit Vrbo is attempting to pull. Because all they are really marketing is that they are switching from 8% to 12% but they are leaving out that they already charge upwards of 15% on the guest side. Most hosts are unaware since they don't see the fees coming from the other side.
1
u/arizona_dreaming Unverified 7h ago
I have a different take— they are just trying match Airbnb who changed to an “all inclusive” price. They are already charging 15% but part of it is a service fee charged to guests. Now they will charge the full amount to the host just like Airbnb.
Will they charge an additional 15%? Not sure where you heard that. I doubt it. Probably more like 3%.
2
u/shimmi44 7h ago
Check their FAQ on the matter. It explicitly states that a "flexible" (which appears to reference their already dynamically determined 6-15%) guest service fee will remain. Nothing has gone into effect, and they are super vague about the entire situation. But based on what little info they have given, hosts will pay 12% and guests will still pay an undisclosed amount. It sounds as though the guest service fee won't change at all, and the host fee will go up to 12%. So no, it's not seeming to be comparable to Airbnb. They seem to be trying to pull a fast one by claiming they are cheaper than Airbnb because they only charge 12% instead of 15%, while conveniently being super vague and not disclosing how much they are going to charge guests on top of that 12% fee to hosts.
1
u/arizona_dreaming Unverified 6h ago
The bottom line is we don’t really know yet. Hopefully it’s closer to 15% than 30%!
1
•
u/AutoModerator 1d ago
💫 If a post or comment violates any of the /r/airbnb_hosts rules, please report it by selecting Breaks /airbnb_hosts rules and the rule that was broken.
Posts or comments with multiple reports will be automatically removed.
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.