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One of the most frustrating scenarios for a rental host is a last-minute cancellation. It not only results in the loss of payment, but you’ve also lost the profit that you could have earned.
That’s why many hosts and property managers opt to utilize Airbnb’s cancellation policy. Let’s explore how Airbnb’s cancellation policy works and determine which cancellation options align best with your hosting needs.
What Are the Types of Airbnb Cancellation Policies?
Airbnb’s cancellation and refund policy can vary depending on the specific reservation, host, and circumstances. Generally, Airbnb offers several cancellation options that hosts can choose from. They include:
Flexible
You can cancel for a full refund up to 1 day before check-in. As a guest, you are eligible for a refund with the policy and you won’t be charged. After this, hosts will be compensated for each night they stay plus one extra night if they cancel.
Moderate
For this policy, a full refund is available to guests who cancel up to 5 days before check-in. They won’t be charged.
After this 5-day window, hosts will get compensated for each night they remain. Also, an additional night, plus 50% of any unused nights if the guest decides to leave early.
Firm
Guests can cancel their reservation at least 30 days before their check-in date. If the cancellation occurs between 7 and 30 days before check-in, the host will receive 50% of the payment for all the nights booked.
However, when cancellation happens less than 7 days before check-in, the host receives 100% of the payment. Additionally, guests can receive a full refund if they cancel their reservation within 48 hours of booking.
This is subject to if the cancellation takes place at least 14 days before their scheduled check-in date.
Strict
This option offers a partial refund if guests cancel up to a certain number of days before check-in. For instance, 7 days before.
Super Strict Policy
The super strict policy is available for both 30 and 60 days. It is however exclusive and offered on an invitation-only basis. This means it is reserved for specific hosts under special circumstances.
To qualify for a refund, guests must initiate a cancellation at least 30 days or otherwise 60 days before their scheduled check-in date.
In this case, they will receive a 50% refund for all the nights they’ve booked. If they cancel after the slated 30 or 60 days, the host will be compensated. The compensation is in full for all the nights originally booked.
Strict Long-Term
This policy is for reservations of 28 nights or more. Guests can cancel their booking within 48 hours of making it. However, this cancellation must happen at least 28 days before their planned check-in date and they’ll get a full refund.
If a guest cancels after this 28-day window, the host is entitled to receive full payment for all the nights they originally booked. This includes an additional 30 nights.
The same applies if the guest cancels with less than 30 days remaining on their reservation. The host will be paid for all the nights left on their booking at 100% of the rate.
Non-refundable
Some hosts include a non-refundable option in their listings. This way, they don’t suffer a loss if guests cancel. This non-refundable option can be offered on top of other discounts and cancellation policies.
It is to further increase the host’s security against cancellations.
In some cases, hosts may offer their custom cancellation policies, which can vary. Certain situations are exceptions and the cancellation policy established by the host is overridden.
It is best to always read and understand the cancellation policy of the listing you’re booking. This way, you can avoid any surprises if you need to cancel your reservation.
If you have specific questions about a reservation, contact Airbnb’s customer support for assistance.
NOTE
Hosts are also entitled to change their cancellation policy. Perhaps they want to give guests additional options or perhaps they want a bit more security when guests cancel.
In either case, hosts can choose a cancellation policy that works for them and can also easily change it.
Airbnb’s Cancellation Refund Policy
After a guest or host requests a cancellation of a reservation, Airbnb’s refund process is initiated. The host’s cancellation policy determines the amount of the refund the guest will receive, if any.
If the issue is a dispute during the stay, both guests and hosts can use Airbnb’s Resolution Center. Airbnb will mediate the dispute and determine if a refund is warranted.
When you get your refund depends on several factors, including the reason for the refund, and the payment method used. In some cases, refunds can be processed relatively quickly, often within a few days.
Airbnb will refund guests through the original payment method used for the reservation.
While Airbnb initiates the refund process, the actual timeline for depositing the funds in your account is beyond their control. The processing times can be influenced by your geographical location or your currency.
Airbnb regularly updates its refund and rebooking policy. The new one is effective as of April 29, 2022.
It outlines how they will help rebook a reservation and manage refunds if a host cancels it or another travel issue interferes with a guest’s stay.
Extenuating Circumstances
Additionally, Airbnb introduced an extenuating circumstances policy that can provide refunds in case of unforeseen events. These include situations like natural disasters and other emergencies.
It is important to contact Airbnb’s customer support as soon as possible to discuss your situation and request assistance with your reservation.
How to Know Which Airbnb Cancellation Policy Is Right for You
These several cancellation policy options each have their own advantages and considerations.
To decide the best one for your listing, you need to understand Airbnb’s Cancellation Policies first. Familiarize yourself with the different cancellation policies they offer.
First, consider your comfort and your risks. If you’re comfortable with some uncertainty and last-minute cancellations, a more flexible policy could work for you.
It attracts a broader range of guests. This however means a higher risk of last-minute vacancies.
Strict policies, however, offer greater financial security since you’ll receive a larger portion of the payment even if guests cancel. However, this may deter some potential guests.
As a new host, you’re likely to build a reputation and gather positive reviews with a flexible policy. The flexible cancellation policy is guest-friendly. It allows guests to cancel up to 24 hours before check-in for a full refund.
This level of flexibility can make your listing more appealing to potential guests. Guests may generally be hesitant to book with a host who lacks a proven track record of positive reviews.
Established hosts with several reviews and a reputation can attract guests more easily. Offering a flexible cancellation policy can help you level the playing field and make your listing stand out.
This decision should also depend on the type of property you’re renting out. For instance, a beachfront vacation home attracts guests who book well in advance.
In such a case, a stricter policy is more suitable. In contrast, a budget-friendly urban apartment could benefit from a more flexible policy to attract last-minute travelers.
Also, research what other hosts in your area are offering in terms of cancellation policies. Being in line with the local market can help you stay competitive.
Fortunately, you can adjust your policy at any time. However, existing reservations will be subject to the policy in place when they are booked.
