Vrbo (Vacation Rental By Owner) is a unique hosting platform where vacation rental owners can list their long and short-term rental properties and receive bookings. It is a reliable way to ensure guests stay in your vacation homes and helps you increase your income stream.
However, there are Vrbo host fees you need to consider before you sign up for the platform. This is because Vrbo is there to help, and just like most other vacation rental sites, they need to take a small fee to ensure they can stay up and running.
Vrbo service fees aren't all that bad, and you can make the most out of them if you know more about them. That's why we are here to help you find the best Vrbo owner fee payment plan for you, as well as some additional tips to try and increase your income by renting out your vacation rental property.
Why understanding Vrbo host fees is crucial
Understanding Vrbo host fees is crucial because it allows both hosts and guests to make informed decisions and manage their finances effectively. For hosts, understanding the fees associated with listing on Vrbo helps them determine their pricing strategy, maximize their rental income, and evaluate the value provided by the platform. Hosts can compare fees across different platforms to choose the most cost-effective option.
On the other hand, guests benefit from understanding host fees to budget for their vacation rental and avoid unexpected costs accurately. They can compare prices on different platforms, factor in additional fees charged by hosts, and make informed decisions about the best value for their money.
Additionally, understanding Vrbo host fees helps any vacation rental owner comply with legal requirements and ensure a transparent and compliant rental process. Overall, clear knowledge of Vrbo host fees is essential for a smooth and satisfactory experience for both hosts and guests.
The breakdown of Vrbo host fees
There are two main types of fees that Vrbo hosts can choose from depending on their preferences. You can either choose to pay a one-off subscription fee or pay-by-booking fees.
If you wish to take the subscription route, then all it requires is a one-off payment of $499 when you first sign up as a Vrbo host, and then you can list your vacation rental properties as much as you want. This fee covers any service charge; you don't have to make any other payments. This makes it easier to calculate how much you'll make each booking as there aren't fee percentages being taken off each one.
You also receive a few special features with the subscription option, such as listing your vacation home internationally, a Reservation Manager, uploading up to 50 photos, a cool interactive map, and a reservation calendar.
If you don't want to go through the subscription route, then you can opt for the pay-per-booking fees. These allow you to pay a certain percentage each time one of your property listings receives a booking. The split fee involves 8% of the booking, 3% of payment processing, a credit card fee, and a 5% commission fee.
The payment processing fee is charged on the total payment amount you receive, whereas the commission fee is based on the rental amount you charge the guests. This option saves you from paying a larger fee upfront, however, it is harder to try and calculate how much you will earn from each booking.
How Vrbo fees compare to other platforms
The fees Vrbo charges can vary compared to other rental channels in the vacation rental home industry. It's important to note that fee structures can change over time, so checking the latest information directly from the platforms is always recommended. Here is a general overview of how Vrbo fees compare to other vacation rental platforms:
Airbnb is a popular vacation rental platform that typically charges hosts a guest Airbnb service fee of around 3% and variable booking guest service fees, ranging from 0% to 20% of the booking subtotal. It also offers Airbnb hosts a flexible fee structure, allowing them to choose between a percentage-based fee or a fixed fee per booking.
Booking.com is primarily known for hotel bookings but also includes vacation rentals. The platform generally charges hosts a commission fee, which is a percentage of the booking value, typically around 16-20%. Booking.com does not charge guests any booking fees.
HomeAway is a part of the same company as Vrbo, and their fee structures are quite similar. HomeAway charges an annual subscription fee, typically ranging from a few hundred dollars to a few thousand dollars, depending on the listing's location and features. HomeAway also charges guests a booking fee, which can vary but is generally around 5-15% of the booking total.
FlipKey, owned by TripAdvisor, charges hosts a commission fee, typically around 3-5% of the booking total. FlipKey does not charge a guest service fee.
Tips to optimize your Vrbo fees
While you're always going to have to pay fees no matter what option you choose on Vrbo, there are some steps you can take in your own pricing to help you get the most out of your earnings for your vacation rental business:
1. Market Research: Conduct thorough market research to understand the pricing trends of similar vacation rentals in your area. Look for properties with similar features, locations, and amenities to understand competitive rates.
2. Competitive Pricing: Set your rental rates competitively. While aiming for the highest possible price is tempting, an overly expensive rental might deter potential guests. Be realistic and consider the value your property offers compared to others nearby.
3. Seasonal Pricing: Implement seasonal pricing to take advantage of high-demand periods and adjust rates during slower seasons. You can charge a higher nightly rate during peak times, such as holidays or local events, and offer discounts during off-peak periods to attract guests.
4. Length of Stay Discounts: Encourage longer bookings by offering discounts for extended stays. This strategy can help increase occupancy rates and secure bookings for more extended periods due to your generous customer service.
5. Cleaning Fees: Be transparent about cleaning fees, if there is a security deposit or any refundable damage deposits. While some hosts include them in the nightly rate, others charge a separate cleaning fee. Ensure your cleaning fee is competitive and accurately reflects the property's cost.
|Distribution via 40+ platforms including major, affiliate, select access* and niche platforms|
|Single property page - Manage all your listings from within the platform|
|Booking management - Fully synced Bookings list|
|Single & Multi-calendars - flexibly update your availability and see your properties all in one place|
|Performance reporting in one dashboard - see your key metrics by Company or Apartment|
|Dynamic pricing - Managed in-platform and powered by Pricelabs, to increase revenue through rate optimisation.|
|Enquiry management - Track, action and convert direct bookings in one place|
|Smart Availability Search - Match enquiries with available properties through smarter searches.|
|Automated customer communications - Customisable email templates for all your communication needs|
|Automated Scheduler - Aut-schedule your field activity inc. check ins, cleaning and maintenance|
|Deep third-party integrations - Connect your automated schedule to Breezeway, Keynest and more|
|Customisable pre-check in process - Check-in and out times, special welcome packages & upgrades|
|Deposit management - Track, amend and action deposits from Hospiria|
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