In a notable move to realign its pricing structure, Vrbo, part of the Expedia Group, will introduce a flat commission rate of 12% for hosts and property managers starting from 29 October. This strategy aims to consolidate its competitive position against industry giants like Airbnb and Booking.com.
Fee Alterations for Hosts
Currently, Vrbo charges property managers utilizing a property management system (PMS) a 5% fee, while those not using such systems face an 8% commission. A significant 55% of Vrbo’s global listings, including 51% in the United States, are managed through PMS, according to data from AirDNA. The forthcoming flat fee will standardise the commission structure across various management modes.
Guest Fees in Transition
The forthcoming update was communicated to hosts without explicit changes regarding the guest fees, which presently range between 11% and 14%. A knowledgeable source in the vacation rental sector indicated that while some guest fees would remain, there would be significant reductions. This aligns with Vrbo’s approach to maintain some form of service fee applied at the time of booking, though specific details remain sparse.
Industry Implications
The decision to retain flexible yet unspecified guest fees might spark discontent among hosts, as it limits their transparency into the total charges that guests incur. Unlike its competitors, Airbnb and Booking.com, which do not charge guest fees, Vrbo’s approach could influence hosts’ perceptions and strategies within the vacation rental market.
Reporting based on coverage first published by skift.com.