In today’s short-term rental market, having the right pricing strategy can make all the difference in your property being fully booked versus underperforming. Whether this is your first year hosting or you have been a short-term rental operator for several years, knowing how to price your rental correctly will ensure your property is achieving the most profit and having maximum guests.
In this blog guide, we’ll break down actionable, data-backed pricing strategies that help you stay competitive while increasing revenue.
Understand Your Market of Short-Term Rental
Before you adjust your rates, understand your competition and local demand. Research other listings in your area to evaluate:
- Average nightly rates
- Occupancy rates
- Seasonal trends
- Property types and amenities offered
Tools like Airdna, PriceLabs, and Mashvisor can help you get real-time data and competitor analysis. Knowing what similar properties are charging gives you a solid foundation for your pricing strategy.
Use Dynamic Pricing Tools
Dynamic pricing tools automatically adjust your rates based on supply and demand, seasonality, local events, and booking windows. These tools take the guesswork out and ensure you’re not leaving money on the table.
Popular Tools
- AI Your BnB
- PriceLabs
- Wheelhouse
- Beyond Pricing
These tools are designed to increase revenue by optimising your prices daily. Dynamic pricing is a proven strategy among Airbnb hosts looking to implement advanced pricing strategies for Airbnb.
If you want to automate your Airbnb, then join our waiting list to get early access to the AI Your BnB software.
Adjust Pricing Based on Seasonality
Seasonality drives our travel behaviour, so pricing your rental property during the high-demand times, such as holidays, summer holidays, peak times, and local festivities, is essential. Alternatively, you will want to discount during the off-season to keep guests coming and keep your occupancy stable.
Offer Discounts for Longer Stays
Encouraging longer stays helps reduce guest turnover costs and increases occupancy. What are discounts based on stay length? Weekly holdback (week) discount 5-10%, Monthly holdback (month) discount 10-25%. This is one of the most under-prioritised rental revenue tips that creates a predictable stream of income and fewer days of no occupancy.
Optimise Your Minimum and Maximum Night Stays
Avoid setting a flat pricing model across all dates. During peak times, set a higher minimum stay to maximise revenue. In slower periods, allow for one-night stays to fill gaps in your calendar.
Factor in Fees Strategically
Cleaning fees, extra guest fees, and service fees impact a guest’s booking decision. Ensure your pricing remains competitive even after adding fees.
Offer Last-Minute and Early-Bird Discounts
Last-minute discounts are for prospective guests who are unable to book your place on the current calendar date within the next 7 days. Early-bird discounts apply to guests who are booked for a reservable date that is more than 30 days away from today.
The point of both discount strategies is to capture both types of travellers in your short-term rental to increase your occupancy rate to the Maximum.
Monitor and Adjust Regularly
Market fluctuations are constant. Don’t price and forget. Regularly taking time to assess your performance every week is best. Are you booking too quickly? You may be priced too low. Is your calendar empty? Consider lowering the price or offering discounts. Refer to Airbnb’s pricing recommendations or booking trends when considering price adjustments.
Pricing effectively does not mean you will always be pricing your home at the same price! Pricing your home well takes strategy. By knowing the market, using dynamic pricing resources, and being able to trust your good pricing instincts, you can be certain you will maximise both occupancy rate and profit.
Keep in mind that the best Airbnb pricing strategies align with your goal, reach your ideal guests, and adjust to immediate demand. When you consistently apply these rental revenue strategies, you will stay ahead of your competition in the changing short-term rental landscape.
Frequently Asked Questions (FAQS)
How often should I update my short-term rental pricing?
At least once a week. Pricing is a dynamic process; every week, prices can reflect the immediate demand (current market conditions) your rental property may see, competitor pricing, and/or special events happening in your area.
Should I offer discounts for longer stays?
Yes, by offering weekly & monthly discounts, you help increase your occupancy and lower your turnover costs while reaching remote workers or digital nomads.
What’s the best way to price my rental during off-peak seasons?
Use competitive rates and discounted longer stays, and enhance unique experiences.
Want to know more about your earning possibilities from short-term rentals? Then check our blog, where we have mentioned how to check earning possibility step by step.
