This article is reproduced with permission from NerdWallet.
Despite what some travelers might think, booking a hotel in advance is generally not a good idea. The savings are not huge, but last reservation minute lowers the price of a hotel room by around 13%, on average. But what about short-term vacation rentals like Airbnb? ABNB,
NerdWallet looked at actual booking data from hundreds of Airbnb properties, comparing cleaning fee, long term discount and the cost when booking in advance versus short term. This data provides a snapshot of when it was collected in June 2022 and suggests that Airbnbs – unlike hotels – are generally cheaper when booked in advance.
The best time to book an Airbnb
We looked at Airbnb rentals in 10 cities across the United States, comparing prices across three booking periods:
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Three days in advance.
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Four weeks in advance.
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Forty-seven weeks in advance (almost a year).
We found that booking four weeks in advance resulted in the lowest median price.
For this analysis, we have only included properties available in all periods. This means that the same properties were lowering their prices by about a month compared to last minute bookings or those made well in advance. The savings weren’t huge, but they were consistent.
Additionally, we found that most (84%) of these properties used “dynamic” pricing, with rates varying based on demand.
This means that most hosts adjust prices based on availability and other trends. As a guest, this means you should never think of a property’s “price” as static. It is likely to go up and down over time, just like a plane ticket.
More: 12 Ways to Adjust Your Vacation for Inflation
So, is booking an Airbnb at the last minute cheaper?
We recommend a middle way: don’t book months in advance or a few days before check-in, but somewhere in between. This offers the lowest typical rates, according to our data.
Keep in mind that this rule of thumb will not apply in all situations. We took this shot during the summer of 2022, when travel demand was particularly rampant. This may have pushed up prices for late bookings, as tenants found themselves in a kind of “seller’s market”. According to the laws of supply and demand, travelers should expect to see more last-minute deals during low seasons and fewer during high seasons.
Many other factors affect dynamic pricing. According to vacation rental software company iGMS, hosts consider many variables when setting prices, including:
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Seasonality.
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Supply and demand.
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Day of the week.
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Approvals.
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Number and quality of reviews.
The booking time is therefore a factor to consider, but it should not make or break a travel budget.
Also see: This is the #1 complaint against US airlines
Airbnb Hacks and Strategies to Avoid Overpaying
Unlike hotels and airlines, which constantly compete in search results by offering discounted prices, Airbnb has complete control over its search tool. This means that the platform has no incentive to simplify the process of finding discounts or helping users know when a property is offering a good or bad deal on a given date.
The onus is on travelers to do the legwork and avoid overpaying. Here are a few tips:
- Look for statically priced properties when booking last minute during peak periods. These properties offer relative discounts while other hosts raise prices. The easiest way to find statically priced properties is to compare weekday and weekend rates. If they are the same, it is probably a static price for each date.
- Book in advance, but not too far in advance. Think about this from the host’s perspective: they have little incentive to lower prices in advance when availability is wide open or at the last minute when availability is limited. Check prices in advance when you can. When they start to drop, reserve.
- Don’t expect long term stays. The analysis in this article only applies to single night bookings. But digital nomads or others looking for longer-term stays shouldn’t expect to find months of availability at the last minute or even in the last few weeks.
Check: 6 Airbnb vacation rental alternatives
The bottom line
Plane tickets tend to become more expensive in the last weeks before departure. Hotels are getting cheaper, on average. And Airbnb? They fall somewhere in between.
Our analysis shows that the ideal zone is around four weeks before departure. Still, it will be more advanced during peak travel seasons and may even reverse during low seasons when guests are desperate to keep busy.
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Sam Kemmis writes for NerdWallet. Email: [email protected]. Twitter: @samsambutdif.
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