Reduced Cleaning Fees and New Tools: How Airbnb Says It’s Keeping Rates Down

Travelers may choose an Airbnb over a hotel for a number of reasons, but let’s face it: They’ll often go for the cheaper option.

Airbnb CEO Brian Chesky addressed affordability during the company’s fourth-quarter earnings call Tuesday. He said the average price of a one-bedroom Airbnb in December was $114, and that was 2% lower – or $2.28 less – than a year earlier.

At the same time, Chesky said average daily rates in hotels rose 7%, or $10.43, to $149, citing Costar. (The prices include nightly rates and fees, but exclude taxes.)

Chesky said Airbnb took action after receiving feedback “from our own guests that Airbnb was getting more expensive.”

Airbnb Steps to Encourage Affordable Rates

A lot of factors in the economy play affect prices. But Chesky said Airbnb took the following steps to nurture affordability:

• After intense complaints about excessive cleaning fees, Airbnb early last year launched total price display in the U.S. and certain other countries, and the feature shows the nightly rate plus all fees upfront, everything except the taxes.
• 300,000 listings saw reduced cleaning fees or eliminated them. Some 40% of listings don’t have any cleaning fee.
• Airbnb encouraged hosts to offer discounts for weekly or monthly stays and two out of three hosts now offer a monthly or weekly discount.
• Airbnb launched a host tool called Compare Listings so hosts can see the rates of similar listings in their neighborhoods to see if they get booked.

“Since we rolled out that tool,” Chesky said, referring to Compare Listings, “1.4 million hosts have turned that tool on. And this means they’ll provide more competitive listings.”