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Both guests and hosts complain that Airbnb service fees are completely out of control. It might be difficult to understand how Airbnb calculates its service fee and it is even frequently misinterpreted.
The amount of the service fee that is charged for a reservation varies and is determined by a number of criteria.
What Is the Airbnb Service Fee?
The Airbnb service fee covers various costs associated with using the platform, such as customer support, security measures, and platform maintenance.
It can appear relatively high because it’s a percentage of the total booking cost, including the rental fee. Airbnb now charges a 20% service fee for experiences.
Service fees for guests are under 14.2% of the booking subtotal. This is unless an alternative arrangement has been made between the host and Airbnb.
Reasons Why Your Airbnb Service Fee Might Be High?
Airbnb does not publish the precise criteria it uses to determine its service fee. The simplest way to determine the specific criteria Airbnb utilizes is to look for it on the reservation.
Here are possible reasons why your Airbnb service fee might be high.
Location
Service fees can vary based on the popularity and demand for accommodations in a particular location. If you’re booking in a highly sought-after area, the service fee might be higher due to the competitive nature of the market.
Accommodation Type
Different types of accommodations have varying service fees. They have private rooms, entire homes, and luxury properties. Higher-end accommodations or unique properties could come with a higher service fee.
Duration of Stay
Longer stays might incur a higher service fee. This could be because longer stays could potentially involve more maintenance, communication, and support from the platform.
Total Booking Cost
The cost of the service charge is determined by the price that hosts have set for their rental. The service fee is calculated as a percentage of the total booking cost, including the rental fee.
If you’re booking a more expensive property, the service fee will naturally be higher. Guests are then given the complete cost of their booking when they are looking through.
Keep in mind that fees can vary based on factors like location, property type, and length of stay. While the service fee might seem steep, it contributes to ensuring a secure and smooth experience for hosts and guests.
Platform Expenses
This fee is designed to offset expenses related to products, services, and the support infrastructure Airbnb offers. It also encompasses the maintenance of liability insurance for the majority of experiences.
The service fee covers expenses related to running the Airbnb platform. This includes maintaining the website and app, providing customer support, implementing security measures, and improving the user experience.
These require significant resources and personnel, which are funded in part by the service fee.
Host Services
The fee also contributes to services that Airbnb provides to hosts. These include marketing their listings, facilitating payments, and offering tools to manage bookings effectively.
Some hosts offer additional services such as airport pickup, concierge services, or guided tours. These services can contribute to a higher service fee. Generally, hosts have control over how they price their properties.
Moreover, some hosts might choose to set higher nightly rates, which can result in higher service fees.
Seasonal Demand
During peak travel seasons or holidays, the service fee might be higher due to increased demand for accommodations.
Insurance and Guarantees
Airbnb offers certain guarantees to hosts and guests, such as the Host Guarantee and the Guest Refund Policy. These protections require resources and are partially funded by the service fee.
Constant Improvement
Airbnb invests in enhancing its platform, introducing new features, and adapting to changes in the travel industry. The service fee helps support these ongoing improvements.
Amenities and Features
Properties with more amenities, features, or special services might come with higher fees to cover the costs of providing those extras.
Currency Exchange Rates
If you’re booking a property in a different currency than your own, currency exchange rates can affect the total cost.
Service fee is non-negotiable and is primarily determined by Airbnb’s pricing structure. Before making a reservation, it’s a good practice to review the breakdown of fees and terms associated with the property.
This way, you can fully understand what contributes to the overall cost. For hosts, it is easier to check the service fee. To do this, Go to your Airbnb inbox.
Click on the guest message thread to see the reservation’s precise service cost. Under the ‘Payout’ column on the left, you will see the ‘Service Charge’.
How Can You Avoid Paying Service Fees?
Avoiding Airbnb service fees entirely is not possible. As previously mentioned, the service fees are a fundamental part of Airbnb’s business model.
However, there are a few strategies that you can consider to mitigate or reduce the impact of service fees.
Negotiate with Hosts
While this is not a common practice, you could try negotiating the price directly with the host. See if they would be willing to reduce the price to offset the service fee.
Keep in mind that hosts have their own costs and considerations. Negotiating might not always be successful.
Check if the Unit Is Listed on a Private Website
You could try searching for the Airbnb listing online. If the apartment is in high demand, there’s a high probability that the owner has it posted on a personal website.
This way, you can book directly with the owner without paying a service fee to Airbnb. You will have the chance to bargain rates directly with the owner if you choose this course of action.
Note that, with this option, you’ll be doing away with Airbnb as an intermediary at your own risk.
Use Airbnb Gift Cards or Credits
If you have Airbnb gift cards or credits, you can use them to pay for part or all of your booking. This can help reduce the effective cost of the service fee.
You should also look for Special Offers. Sometimes hosts might offer discounts or special offers for longer stays or during off-peak seasons. Keep an eye out for these opportunities, as they can help offset the service fee.
Book in Bulk
If you’re planning to book multiple stays over a while, a reduced fee might be possible. You might be able to negotiate a deal with hosts for a reduced rate. This could help you save on service fees across multiple bookings.
Earn Airbnb Host Credits
If you’re also a host on Airbnb, you can earn travel credits when you refer new hosts or guests. These credits can be used to offset the cost of your own bookings, including the service fees.
While these strategies might help you save on costs, they come with potential risks and limitations. Booking outside of Airbnb’s platform might lack the safety measures and support that the platform offers.
Also, negotiating with hosts may not always be successful.
Remember
While the Airbnb service fee might seem high, it’s meant to provide a range of services for you. These services ensure a secure and enjoyable experience for both hosts and guests.
It’s a good practice to consider the overall value you’re getting from your booking. This includes factors beyond just the service fee.
As a guest, you should carefully consider the total cost of your stay, when comparing options and making booking decisions.
