Airbnb recently changed their fee structure, and it’s been a big topic in the short-term rental industry. While removing the guest service fee may sound simple, for property managers (PMs), it’s not as straightforward when it comes to deciding how to adjust pricing.
What Changed?
Previously, Airbnb added a service fee on top of the nightly rate that guests paid. This fee wasn’t fixed and could vary depending on the booking, and neither hosts nor guests had a clear idea of exactly how much it would be. With the new system, Airbnb has removed that guest fee. Instead, hosts and PMs now take on the full commission within their payout.
The First Reaction: Raise Prices?
The obvious reaction is just to raise nightly rates to make up for the extra commission. But there are some risks here:
Guest Perception: Guests only care about the total price they pay. Since the old fee wasn’t consistent, the actual “discount” they see now isn’t the same across all bookings. A flat increase may not line up with what they expect.
Market Competition: If some PMs raise rates right away and others don’t, those who raise rates too quickly could end up overpriced compared to others.
Why It’s Better to Move Carefully
It’s usually better to take a measured approach instead of marking everything up right away. A strategy based on actual pickup and pacing works more effectively.
Watch Booking Trends: If bookings are coming in faster than expected, especially during busy seasons, that’s a sign you might be able to raise prices gradually.
Pay Attention to Seasonality: In slower periods, raising prices aggressively could hurt your chances of getting booked. Staying flexible keeps you competitive.
Think Like a Guest: At the end of the day, guests aren’t thinking about your costs—they’re looking at the total price and comparing it to their budget and other options.
What PMs Can Do
Start neutral—don’t raise everything right away. Keep your base pricing steady at first to see how the market reacts.
Adjust with demand—if your listings are booking quickly, raise prices slowly and in smaller steps until things balance out.
Stick with your RM practices—treat this change like any other shift in demand or seasonality and adjust with the tools you already use.
Keep an eye on competition—if others aren’t raising prices yet, jumping ahead of the market could backfire.
Adjusting in Wheelhouse
For property managers using Wheelhouse, adjustments can be made directly in the platform without overhauling your full strategy:
Use the Day of Week Setting: This feature lets you apply a percentage adjustment to specific days of the week. For example, if weekends are seeing higher pickup, you can mark up those nights selectively rather than applying a blanket increase across all days.
Combine With Market Data: Cross-check Wheelhouse’s competitive set insights with your pacing. If your pricing looks low compared to the market, you can apply gradual mark-ups in a targeted way.
Keep it Flexible: Since the fee structure impact is still unfolding, making small and careful adjustments through the Day of Week tool is a safer approach than large rate increases.
How to Apply Mark-Ups in Your PMS
If you prefer to handle pricing adjustments directly through your Property Management System (PMS), most platforms provide a way to layer additional mark-ups:
Channel-Specific Mark-Ups: Many PMS tools allow you to set unique mark-ups for Airbnb versus other OTAs. This ensures you can recover margin lost to the new fee structure without impacting your broader channel strategy.
Flat or Percentage Adjustments: Depending on your PMS, you can choose to apply either a flat nightly increase or a percentage uplift across listings.
Automation Rules: Some PMS platforms let you build automation—for example, applying mark-ups only during certain seasons, minimum stay lengths, or booking windows.
By handling adjustments within your PMS, you maintain centralized control across all your connected channels while tailoring your Airbnb pricing specifically to this fee structure change.
The Bottom Line
Airbnb’s change shifts more of the cost to hosts and PMs, but the best response isn’t a one-size-fits-all solution. The key is to stay flexible, watch your demand closely, and adjust as needed. The right balance is recovering your margin while still staying competitive in a market that’s changing.