Effective 6/1/2016 VRBO/HomeAway is charging guests, that book on the site, a 4% to 9% “Service Fee”! According to VRBO the average is 6% on bookings – with a maximum service fee capped at $399 per booking.
Book on VRBO and pay a 4% – 9% “Service Fee”!
What they “need” the service fee for …
According to information published by VRBO to owners and property managers, they’ll use the service fees to pay for their online advertising, transaction/rental insurance and development of things like apps and web site speed.
From our perspective, those are things that a rental platform should be providing as part of their core business model! Those aren’t add-ons requiring special funding! But hey, we’re not accountants. We don’t manage a hedge fund. We don’t answer to stockholders!
How does this impact guests?
Vacationers are already facing increased fees from airlines and baggage fees, airport security fees, fuel surcharges, regional hotel taxes and now, it seems, a fee to book through VRBO! We’re pretty sure that nobody wants to add $200 to $400 to the cost of their vacation rental. Certainly, we know that visitors to St John won’t appreciate the additional fees! That’s why we built www.StJohn-VillaRentals.com . So that guests and owners/managers would have a professionally built and promoted option to the service fees and forced online bookings of the mega rental sites!
How does this impact the Owner/Manager?
At first glance it might appear that this Service Fee only effects guests that book through VRBO. But we suspect that once guests realize they are paying a fee – that VRBO online bookings will begin to drop as those guests seek other ways to contact the owner/manager of the rental villa they are interested in.
You asked for it. We built it.
The St John rental community has been growing increasingly dissatisfied with VRBO over the past 2 to 3 years. VRBO’s growth and with it increased bookings has lead to a dangerous dependency by rental agents/owners/managers. We hear it over and over again … “They [VRBO] bring me bookings. I can’t afford to take my listing off the site!”. VRBO realizes the tremendous power they have over subscribers. So, they’ve begun to increase fees, implement a pay-to-play system that favors those that pay ever-increasing amounts to VRBO; and leaning on owners to process all of their bookings through VRBO.
www.On-Stjohn.com wrote …
“If you reject the new online booking system, the renewal rate still falls to just $499 a year, half what some plans are now. But here’s the veiled threat in VRBO’s message to owners: Participating, or not participating, in online booking will determine the position of your listing in search results.
The way I read that? Let VRBO hit your guests with a big service fee (4%-10%), or VRBO will bury your listing.”
Read the entire article here http://www.on-stjohn.com/2016/05/01/villa-owners-vrbo-gets-cheaper-with-a-catch/