Airbnb almost as expensive as a hotel, figures show, as rising fees spark user outrage

Staying in an Airbnb rental can be barely cheaper than staying in a hotel, at least for small groups booking short-term stays, according to an analysis of Toronto short-term rental and hotel prices. This may be part of the reason why customers are increasingly irritated by the litany of fees included in their bookings.

In Canada’s most populous city, the average daily rate for a studio or one-bedroom apartment on the Airbnb platform in July was $214, according to AirDNA, a short-term rental data provider. That was $33 less per day than the average $247 Toronto hotels charged for roughly the same period, according to data covering the July 1 to July 30 period from STR, an analytics firm focused on the hospitality industry.

The average rate for studio and one-bedroom rentals, which AirDNA considers comparable to hotel rooms, rose 44% from $148 per day in July 2019, during the summer before the start. of the COVID-19 pandemic. By contrast, the average daily rate paid by travelers staying in Toronto hotels has risen 24% over the same four summers, from an average of $199 in July 2019, according to STR.

For Airbnb listings that include larger properties — but not shared accommodations — the average daily rate in July was nearly $300 per day, more than 50% above average rates in July 2019, figures show. from AirDNA. Data for short-term rentals does not include service charges, which can vary but often amount to an additional 10 to 15 percent, the company said.

Airbnb ABNB-Q disputed some of the data, saying third-party analytics of its listings typically cause a number of issues, including perhaps not accurately reflecting actual bookings or what customers paid.

The short-term rental giant said the average daily rate for Airbnb accommodations in Toronto increased by about 15% between 2019 and the first six months of 2022. It did not provide dollar amounts for the rates. average dailies.

Hotel-like prices may help explain some travelers’ growing anxiety about the many fees that customers have to pay on top of the base rate advertised on the platform.

“I’m not staying with Airbnb anymore,” US-based Twitter user Michael Karnjanaprakorn wrote recently.

“Cleaning fee: $200. Instructions: Clean dishes, take out trash and wash all linens before you leave,” read the tweet, which received more than 27,000 likes.

In a press release last year, Airbnb criticized the fees, noting that users can see a detailed breakdown of potential fees before committing to a booking.

Cleaning fees are set by hosts based on factors such as home size, location, amenities, and number of guests. “We believe that hosts having autonomy over their own pricing help them succeed on our platform,” the company wrote.

Enhanced cleaning protocols due to COVID-19 may also have increased cleaning expenses for some hosts, the company noted.

Other fees include a service charge — typically less than 14.2% of the reservation’s subtotal — collected by Airbnb and government-imposed occupancy taxes, the company said. (In Toronto, for example, Airbnb has been collecting a 4% municipal tax since the start of 2021.)

But Airbnb’s public relations response did little to appease disgruntled guests. Travel expert Matthew Kepnes, for example, said he’d given up on Airbnb for good.

Mr. Kepnes, who manages the website nomadcmatt.comargued that Airbnb rentals are no longer a good deal for short-term stays, especially in big cities, where there are plenty of hotel options.

“If you’re only going to New York for three days, it doesn’t really make sense,” he said.

Part of the reason is that fees can add significantly to the cost of a brief stay, Kepnes said. In a February 2020 tweet, he referenced an Airbnb ad with a base rate of $100 a night and a cleaning fee of $200. “These cleaning fees are so expensive. I might as well stay in a hotel for that price! he wrote.

Mr Kepnes also has qualms with Airbnb customer service, which he says makes it difficult to get refunds. This is another point in favor of the hotels, he argued.

Cost aside, he also has ethical reservations about using short-term rentals in major metropolitan areas. In many large cities, services such as Airbnb are depriving future homeowners and long-term tenants of much-needed housing stock, he said.

Still, Airbnb can be a good choice in more remote areas, especially when booking longer stays, he said.

A growing number of travelers could come to Mr. Kepnes’ conclusion about shorter bookings versus longer bookings. Since the start of the pandemic, Airbnb has seen an increase in longer bookings. Stays of 28 days or more increased 25% in the second quarter of 2022 compared to the same period in 2021, and almost 90% above the levels recorded in the second quarter of 2019, the company said in its last publication. of results.

Bookings of around a month or more have become its fastest growing type of trip in terms of duration, Airbnb said.

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