Though it is commonly pronounced “Verb-oh” VRBO is actually an acronym that means Vacation Rentals By Owner. Today there are many other online booking engines but when VRBO first launched in 1995, it was a relatively new concept that helped homeowners bypass the cost of a management company. Today, the site boasts over two million private homes in over 190 countries.
If you are considering alternative vacation rental booking sites, VRBO is a good place to start. Creating a listing on VRBO will increase the reach of your audience and even introduce your property to an international audience thereby increasing the number of paying guests and overall rental income.
Are you thinking about listing your property on VRBO? Read our blog article on how to list on VRBO for a step-by-step guide to listing on the platform. A key thing to remember when listing properties in multiple sites is that the calendars of all booking engines are in sync to avoid overbookings.
Most of the time, when travelers book holidays, they plan to complete their stay but sometimes due to emergencies, perhaps due to personal or other factors such as natural disasters and travel restrictions, they may have to cancel. That's why a cancellation policy is of utmost importance to hosts. It gives guests all the important information as part of the short-term rental agreement while help you cover costs if guests cancel at the last minute.
When it comes to cancellation policies on VRBO, hosts have 6 policies, 5 of them in a range of strictness while the sixth kind is custom-made by hosts. When opting for cancellation policies it may make sense from a host’s perspective to go for the strictest one but it won’t always sit well with guests especially if they have never met you or experienced your service. So, it might help to advertise top-notch amenities and look at practices that would drive better bookings regardless of your cancellation policy.
This is the strictest policy where refunds are not offered for any reason whatsoever. This rigid cancellation policy may turn off some guests, especially those using the platform for the first time. However, VRBO premier hosts may be able to get away with it because having the badge could take you a long way towards building your credibility.
This strict 60-day policy allows guests that cancel 60 days before the check-in date a 100% refund. While this gives hosts enough time to find new guests, we must note however that not all guests plan their holidays 2 or 3 months ahead so this policy will have absolutely no value for guests who book a month or a few weeks ahead.
This is a firm policy that allows guests 100% of their refund if the cancellation is made 60 days before the check-in date and 50% of the refund if made 30 days before the check-in date. While being more flexible than the previous two options it is also ideal as it gives hosts at least 1 month to find new guests for their property while making an additional 50% of the rent off of the canceled guests.
This moderate policy allows guests that cancel 30 days before the check-in date 100% of their refund while those that cancel 14 days before the check-in date get 50% of their money back. This seems to be a popular policy among hosts as it gives hosts enough time to find new guests for the canceled dates if guests cancel 30 days ahead. Hosts can still make 50% of their booking amount when guests cancel out 2 weeks ahead and have enough time to rope in new guests especially during peak seasons.
This very flexible policy allows guests to receive 100% of their money when they cancel 2 weeks (14 days) ahead of the check-in date and a 50% refund when they cancel 1 week (7 days) before their check-in date.
While this may seem like a big risk to hosts and many may opt for a safer cancellation policy (and rightfully so) there is a new trend emerging that may offset the risk posed by the 14/7 day policy. According to sources, there is a 19% increase in trips booked one week ahead with 84% of millennials confessing to having made last-minute bookings as late as one day before the check-in date.
Some properties are allowed to have that may differ from those mentioned above and may have different cancellation terms and fees associated with them. These policies must all be mentioned directly on the property description page.
Having a cancellation policy that is too rigid might be a mistake considering the travel environment and the restrictions that may be posed due to health reasons, weather conditions, denied visas, or even political conditions of different regions. Guests want to feel confident that if any sudden restrictions are made that they won’t completely lose out.
If you are new to the property management business read our blog articles on starting a vacation rental property management business and tips to keep it marketed all year round.
If you are looking for help around growing and expanding your property rental portfolio don’t forget to check out Hostaway’s range of offerings and request a free demo to witness first-hand how we help property managers all over the world expand their businesses.