How far out should your vacation rental be booked to maximize revenue?
It feels pretty good to watch your vacation rental calendar fill up, especially during the busy summer season.
What you’re probably not recognizing, however, is that this might not be an entirely good thing. Back-to-back reservations for months on end probably means you're leaving money on the table.
So how do you ensure that you are pricing your listings appropriately? The first thing to recognize is whether you are over or underpriced:
- A great way to judge if your place is overpriced is to pay attention to your calendar vs. what you’re charging for each day. If you’re seeing upcoming dates that are still not filled, that could be a sign that you’re overpriced.
- A great way to judge if your place is underpriced is to pay attention to when your neighbors are booking. If you’re booked up six months ahead of time, for example, it probably means that you have one of the best deals in your market. Your neighbors who set a higher price for their place didn’t book as quickly, but made more money as demand for those dates increased and the number of available listings online went down.
If you want to see how your competitors are booking up, you can use the Nearby Listings tool in Beyond within each of your listings. Beyond even calculates an estimated Health Score for each listing in your market to give you an idea of how they are performing:
This basic lesson in supply and demand informs what is known as the "booking curve." The booking curve tells you the pace at which you should be booking, based on predicted demand.
In simplest terms, if you book up too fast, you’re probably priced too low. If you haven’t booked fast enough, you’re priced too high.
A good rule of thumb for urban markets is to aim to be about 50% booked one month out, 30% booked two months out, and 10% booked 3 months out and more. These are flexible numbers and vary by city and neighborhood, but they represent in a general sense when guests are booking. Most hosts don’t realize how late guests book and worry unnecessarily (and at great cost) about unbooked days less than a month away.
For example, we know that about half of reservations on Airbnb happen within 30 days of arrival, so if your calendar is completely full one month out, you could raise your price to keep up with how much demand there is for your apartment.The best way to measure success for your Airbnb business is not by dates marked off on the calendar, but how much money is in the bank.
Additionally, Beyond users can review their listing and portfolio-level average booking lead time that will provide insight into how far out their listings are typically booked. To see this at a portfolio level, Beyond's Insights Tool visualizes this data in an easy-to-read chart (below).
Beyond is a data-driven revenue management platform that enables you to assess how your listings are performing against the market. We empower our customers to easily make the adjustments to make the most of the supply and demand in the market, and ensure your booking curve is performing at peak efficiency.
If you have a Beyond account, take a look at how your portfolio is performing with our Insights Tool.
If you’re yet to sign up, try us for free for 30 days starting today!
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