Homeowners and managers are reporting that HomeAway has been quietly inching up the service fee, in some cases over 12%.
“Since price is an important factor in determining whether a traveler books a property, it’s natural to optimize and adjust the exact amount of the service fee,” stated HomeAway’s Community Forum. “This means the service fee amount will change from time-to-time, based on different factors…Communication with you is important to us – but we don’t communicate all of the tests we run due to the frequency of the tests we run.”
While HomeAway tests their optimal “service fee” for travelers, property managers and homeowners face consequential challenges. For example, guests do not understand the fee and frequently blame the manager or homeowner for the increased cost. The fee is often non-refundable, causing additional friction between the guest and manager/owner.
In addition, HomeAway is now requiring all of their listings to enable online booking.
According to Jason Sprenkle, co-owner at 360 Blue in the Florida panhandle:
“At this point you have to determine whether you should continue to invest in building the VRBO brand, or use those same funds to begin investing further in your own brand. That question will depend on the strength of your current brand, your market’s dependence on VRBO, and your relative market share.”
Diane Smith, owner at Bearfoot by Owner Luxury Rentals in Myrtle Beach added:
“We have over 20 properties listed on VRBO/HomeAway. We are losing bookings because of the Service Fee. We take credits cards through our office, and we try to explain to the potential travelers to book directly through us to avoid the service fees. Often they do, but then others think it is some sort of a scam. We fought the new service fee as did many other property managers but to no avail. Our rates are competitive and under some, but then the service fees drives them higher! Very annoying.”
The increase in fees also generates an overall price increase to the consumer which potentially drives travelers back to hotels and other lodging alternatives. As one homeowner wrote:
“Here is the rub as I see it with HA incessant testing of an ‘optimal’ service fee – When the fee is deemed excessive we lose a booking. When the fee is acceptable or low we MAY gain a booking we would probably have received prior to the fee. HA (Expedia) is running the test at very little or no cost to them but potentially a high cost to the people who make their business possible (at least in the vacation rental world). To me this is blatant greed and disregard for the owners of the ‘inventory.'”
Evolution of HomeAway’s “Service Fee”
2014
In 2014, HomeAway was committed to not charging travelers a fee. “We are going to be free to travelers,” said Brian Sharples, co-founder and CEO of HomeAway, to shareholders in November of 2014. “TripAdvisor and Airbnb have chosen to charge big fees to travelers,” Sharples continued. “Well, we’re going to have a pretty sizeable marketing budget in the next few years. And we’re going to be letting everybody know, when you come to our platform, you don’t pay a fee, and we think that’s a big deal because if you look historically at the travel industry, those competitors who adopted no traveler fees first are the ones that ended up being the big winners in that business.”
2015
In November 2015, when HomeAway announced that the company was being acquired by Expedia, Brian Sharples surprised its suppliers by revealing the addition of a traveler service fee, which would be based on a sliding scale and would begin rolling out in Q2 of 2016. Sharples said the fee was expected to “add an average of roughly 6% to most transactions that run through its online shopping cart.”
2016
In March of 2016, HomeAway disclosed the amount it would be charging consumers. “The service fee is a fee charged to the traveler and is calculated on a sliding scale of 4% to 9% of the rental amount, excluding the deposit or taxes. The charge applies to the cost of the rental and will not exceed $499. The service fee helps cover the cost of running the HomeAway websites, including features such as 24/7 customer support and marketing efforts to ensure a quality experience on our sites for both travelers and owners.”
2017
Last month, HomeAway changed its policy, increased the range of the fee, and began testing even higher percentages. According to HomeAway, “The service fee is between 5-12% for most bookings but can be above or below, based on the reservation.”
In addition, HomeAway is now requiring all listings on their channels to enable online booking. On March 28, 2017, HomeAway sent the following message to property managers and owners who list on their sites:
Dear HomeAway Partners,
For some time, online booking enrollment has been a requirement for new and pay-per-booking listings, and our Partners are already benefitting from the value and convenience it offers. As part of an effort to help boost your earning potential and create a more consistent site experience, online booking will now be required to renew all subscriptions.
As the vacation rental industry continues to become increasingly competitive, it’s more important than ever for property owners and managers to keep up with new developments. During the past few years, one clear trend has been dominating the industry: Travelers prefer having the option to book online. My support team hears this every day, often from first-time vacation rental travelers that HomeAway continues to draw.
Throughout my six years at HomeAway, we have managed many product and industry changes together. Based on our shared growth and your feedback during that time, we’ve expanded to 24/7 support (including all holidays) and walked thousands of Partners through the details of both adding online booking and managing it day-to-day. We are talking to you about how to adjust your listing to be successful in best match, and helping you view your listing from the lens of the conversations we have with travelers. I’ve spoken with many of you personally; my team and I are here to support you during your online booking transition.
While HomeAway works to meet our shared travelers’ preferences, we want to make sure you’ve got plenty of flexibility and control over how you manage your bookings. When you enroll in online booking, we’ll ask you to choose the option that works best for you: 24-Hour Review or Instant Booking. You can read more about online booking here.
Regardless of which online booking option you choose, you’ll still have the same control over your rates, your property availability, and the ability to contact your guests. You’ll also have the benefit of recent enhancements to your house rules concerning items like pets, events, smoking, etc.
If you currently have a subscription listing and don’t have online booking, you can add it by logging into your dashboard and view your listing:
If you choose to wait until your next renewal date, we’ll send an email containing more information about your options closer to that time.
Thank you for using HomeAway to manage your vacation rental business. We’re looking forward to another year of working together.
At your service,
Valerie Pearcy
Vice President, Customer Experience, Americas
We have suddenly been put on instant booking without notice by VRBO/HA. Prior to this our property has been relegated to the bottom of the listings because we would not do online booking. Our vacation rental has a shared pool,tennis court, and picturesque ocean views on all 3 sides, and is located in the historic Auburn Colony in Harpswell, Maine. So far, there is no local site for our area that does not charge outrageous fees. We screen all our guests. Does anybody have any suggestions on how to start a local advertising site?
I have two properties I have advertised on VRBO for years, one of which I have dropped from VRBO and the other which will be dropped in December. Expedia has really broken a useful tool but thankfully I have found alternatives. I have never been abused by any company like I have by VRBO. Mostly though, they have stopped producing leads for me. The traveler’s fee prices me out of the market.
Nice to see I am not the only one infuriated with expedia. Boycott and slam them every chance you get. They took over ha/vrbo and are ruining it. Wish I knew how to get a website started!. If you are renting in Cape Cod area or Florida a site I started with is weneedavacation.com, flat fee had them for first 3 years and very good. Not as much exposure but with short rental season in this area also always booked prime weeks and off weekends. With Weneedavacation or ha, never used credit card. All transactions were personal check or bank check. Vrbo/Ha /EXPEDIA fees are outrageous. We had luxury of being able to call/email renters and get a feel for who they were and what they wanted. Expedia’s policy did not consider US the customer and our prospective clients. With thier business model they are in charge of my property and they Do Not Care who rents it!. Let expedia and the local/National news know what a Rip off this is.
Is there any documentation on the number of people who have collected with the “HA book with confidence” program? After reading the disclosure it appears that no one would ever quality.
I just signed up to list my property with Tripz.com. They seamlessly integrated my VRBO listing onto their platform. Flat fee, no forced online payment options, no scam to renters with tack-on service fees that do nothing. VRBO is a total rip-off and a scam run by greed.
Using your own website is spotty……the personal work offline hours and media advertising dollars can be immense…..ongoing and sadly unproductive. Who really wants to deal with the crooked ghouls running local Visitor Bureaus, for example.
Technology chopped hundreds of thousands of human travel agents by letting open access to personal computers to travel inventory ruining careers, companies and lives. No one cared about these job losses……so don’t be offended when you are chopped…no one cares.
Local Realtors and MLS tools are lacking for short term rentals. But, if would be available, these services would be expensive though reasonably successful.
In reality, Do you really think behemoth travel companies will continue to fool with gazillions of little ornery, unprofessional, inconsistent mom and pop shops without covering their sanity preservation and real dollar costs?
We are had…..they know it……costs will rise to 15-20 percent for you and or your guests.
Property managers that are pulling more than half of their bookings from VRBO need to quickly develop and implement a strategy to market to consumers directly. This approach includes website optimization, social media marketing, creating destination content, sending out email blasts and making outbound calls to previous guests. There are solid indicators that VRBO sees greater revenue opportunities in migrating towards an AirBnB model.
Have any of you tried HomeEscape? It’s completely free to list & use.
Homeescape is not free anymore. They charge a fee to list and also charge a fee if you want to improve your search position. They have no geographic focus and hence lack property density, which makes it less valuable to travelers, who have few properties to choose from at any particular destination. tripz has the same problem. I have had good success with my properties in Panama City Beach FL using ecbyo.com and floridarentals.com. Both more regionally focused and have generated great results for me.
I have been with them for so long my property reference number is only 3 digits!
The way they are treating both guests and owners is shameful and downright greedy.
Their financial partner Holiday Rent Payments is incompetent and managed on 3 separate occasions when returning damage deposits to help themselves to money from the wrong bank account. On one occasion that amounted to £600.
There video showing a dog swimming in the pool particularly annoys me. I would like them to tell me which hotel chain would allow and promote such activity. I certainly would not wish to have those guests in my villa.
They have changed the product for which I joined up to. I also will be walking once this years subscription is over. They are so large now they won’t even miss me. So much for loyalty.
There are many regional vacation rental listing sites being developed as alternatives to VRBO. They will be able to compete on a regional level and focus marketing where vacationers come from for those areas instead of having to market nationally. Here are some.
North Carolina & South Carolina: carolinavacationhomerentals.com
Texas: texescapes.com
Hawaii: hawaiianislandsvacationrentals.com
South Jersey: capemayvacationrentals.com
Florida Panhandle: emeraldcoastbyowner.com
Long Island Beach NJ: vacationrentalslbi.com
Airbnb is free to list, but takes up to 15% of bookings between host/guest fees. So its not much better.
Check lodgify and rentivo to use as your primary booking site. They seem to have reasonable low fees. Support no-commission book-direct websites.
Here’s the latest. I am a property manager with homes listed on VRBO. I also have a private home in another city which I just listed on VRBO privately (not through my company). I received a call from a representative from Explorie (spelling?) letting me know they had been notified by VRBO that I had not fully completed my listing and that they could help with that AND list my home on their program. They called me on my cell (provided by VRBO) so they had no idea I was a prop. mgr. The rep said that VRBO gave them my contact info. Well…… I have a call in to my VRBO rep to see what is going on. Truly – there is something exptremely wrong with a company giving out this sort of info. only to select rental companies. Explorie said it is because they handle properties internationally, not just locally. Anyone else just a bit irritated by this!
Where else can a person advertise? Vacation Home Rentals was purchased by Trip Advisor and doing the same thing.
Hello everyone!!!!
My name is James Carter and I am working with Vacation Rental Company. If anyone interested to advertise their Vacation Rental in Hawaii, then you guys can write me an email on james.carter@rentholidayrentals.com
The advertisement will be for free only for Hawaii properties, till the time you will get first booking. After getting the booking you have to pay us a Subscription fee.
Website Name : http://www.rentholidayrentals.com
https://lodgable.com/
They list your property on 50+ booking sites and only charge 4.5% booking fee. I LOVE IT. My nights booked has gone through the roof!
Where else can you advertise. Trip Advisor took over Vacation Home Rentals and is doing the same thing. Is there an option somewhere else?
There is a Facebook for vacation rental owners where we helped each other understand the new rules of HA and alternative methods of advertising.
“Say no to VRBO service fee”
It’s now time for my own property web site.
Enough is enough.
There is a Facebook page for owners. We share info with each other. We have one meme we that has provided info on starting your own web site. Others have started regional listing sites to help owners gain independence from Homeaway.
“Say no to VRBO service fee”
To join the moderators will verify your vacation rental listing. There are 2 similar pages one for owners and one for guests. The owner group is a “closed” group so you must be verified to join.
Hello everyone!!!!
My name is James Carter and I am working with Vacation Rental Company. If anyone interested to advertise their Vacation Rental in USA including Hawaii and Alaska, then you guys can write me an email on james.carter@rentholidayrentals.com
The advertisement will be for free, till the time you will get first booking. After getting the booking you have to pay us a Subscription fee.
Note : Listing work will be done by the homeowners or Property Managers. If you want us to do listing work for you guys, then you have to pay us a listing fee of $20.00 USD
Website Name : http://www.rentholidayrentals.com
We have two vacation rental properties and left VRBO / HA when they started this nonsense. I feel like I should not divulge my “secret” but – Vacation home owners: we’re doing slightly fewer nights per year but making more money now! How?
Easy…we aren’t paying VRBO to be listed, we still use Aibnb and to some degree Tripadvisor (few, few bookings). All the properties in our area are so much higher after fees are taken into consideration, that we were able to raise our nightly price and direct bookings gladly pay more per night as their total overall cost is still lower than using an OTA. Thanks to VRBO and ever increasing fees, we have higher nightly rates and less work! I guess I do owe them some gratitude….plus, customers who take the time to research on their own and book directly are usually more respectful of us and our property.
It takes work and dedication. Our website and marketing efforts are daily tasks (they only take a few minutes but are tended to EVERY day) and we are reinforcing our brand with our guests. YOu can too. How serious are you about this?
Dump VRBO where it belongs. There is no circumstance we can imagine where we return to VRBO for any reason. You have the power and you can get the bookings you need while retaining control over your property and investment.
If you think that owning a vacation rental is simply making a down payment, sending it to a property manager and sitting back while the money rolls in and the mortgage pays itself…you may be both sorely disappointed and the best customer for VRBO / HA…if you treat this as a business and an investment, OTAs are rapidly becoming a poor fit.
We are just finishing our LAST year with Homeaway/ Owners direct. When we renewed in April 2016 the ‘account manager’ told me there would be no changes. Within 2 months service charges introduced. We have had NO bookings in the last 12 months and yes we signed up to online bookings to no avail. Advice to anyone thinking of joining Homeaway/Owners Direct DONT Their activities are nothing short of FRAUD.
Greed, pure greed.
We pay 400 US dollars per house to advertise on VRBO/Homeaway and that’s not enough to run their website and helpline? Of COURSE it is.
We are owners paying 800 US dollars per year to advertise just 2 houses. And then they charge our customers as well! Disgraceful.
Hello everyone!!!!
My name is James Carter and I am working with Vacation Rental Company. If anyone interested to advertise their Vacation Rental in USA including Hawaii and Alaska, then you guys can write me an email on james.carter@rentholidayrentals.com
The advertisement will be for free, till the time you will get first booking. After getting the booking you have to pay us a Subscription fee.
Note : Listing work will be done by the homeowners or Property Managers. If you want us to do listing work for you guys, then you have to pay us a listing fee of $20.00 USD
Website Name : http://www.rentholidayrentals.com
I have pulled all of my 6 listing from them.
May I ask where you are advertising now? I have 14 onVRBO. Not really know where to go because I would love to leave them.
Thank you,
Diana
I concur! I decided to not pay their $400 and switch one of my properties to the higher commission rate but now I’m in a position to de-list period as I have guests constantly asking for discounts. It also makes it more practical to start booking guests direct – however that is a significant marketing / management proposition. Airbnb is looking more and more attractive every day.
Where did you go??? I’ve been with them 12 years and do not like what they have been doing for the last several years. r.s.wiggins88@gmail.com
Time to look elsewhere Bookings and enquiries now non existent owing to the charges imposed on travelers and owners. Leaving in the next few months will not require new along with thousands of others who are complaining about HOME AWAY…OWNERS DIRECT
Join the Facebook group “Say no to VRBO fees” a closed group for owners only.
We share info on becoming independent of Homeaway/Expedia. The moderators will ask to verify you as an owner to join the group. We have over 2500 active members.
Some have started regional listing sites as alternatives to HA