HomeAway has become the largest vacation rental site in the world by charging subscription fees for listings. Owners will still have that option, but the new pay-per-booking model could really take off.
In HomeAway’s current model, subscribers pay the company upfront for running its listings on its websites. Starting this summer, vacation rental owners can instead put up a rental listing for free and then pay HomeAway a percentage once the listing is booked. Property managers will be able to use the pay-per-booking service later this year.
In a client note, Chad Bartley of Pacific Crest Securities estimated that the pay-per-booking service could produce revenue from $13 million to $101 million in 2014. Annual revenue from the new offering could eventually reach $304 million, according to his analysis.
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