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Fees for Hosts: How to Become Less Dependent on Online Travel Agencies

October 27, 2023

Online Travel Agencies (OTAs) are excellent platforms for hosts all around the world to list their vacation rentals. It offers flexibility and independence, allowing hosts to set their own prices and offer customized stays to their guests. However, OTAs, like Airbnb and Vrbo, charge fees for its services and this can affect the earnings of the hosts. As a host, it's important to find ways to become less dependent on OTAs and keep more of your earnings. In this blog post, we'll discuss some of the fees OTAs charges and share some tips on how to reduce your dependence on the platform.

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OTA fees for hosts:

When you list your property on OTAs, you'll be charged service fees for each booking. The service fee is a fee charged to both hosts and guests when they book a reservation through the platform. This fee is calculated as a percentage of the booking subtotal (excluding taxes and fees) and most hosts pay a flat rate of 3-5% of the booking subtotal. Guests typically pay a service fee of anywhere from 6-15% of the booking subtotal.

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Ways to reduce your dependence on OTAs

If you want to keep more of your earnings, you can look for ways to reduce your dependency on OTAs. Other alternatives allow you to earn more from the rentals and reduce fees.

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List on Multiple Channels

You may list your rental property on other platforms like Booking.com and Vrbo. Moreover, you can also create your own rental website or use social media platforms to promote your rental property. This may not only help you reduce the reliance on OTAs but also help diversify your income streams.

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Market your rental property:

Marketing your rental property properly can help you attract more guests and increase your income. Use social media channels like Instagram, Facebook, and Pinterest to showcase your property and its unique features. Highlight the amenities, activities, and entertainment opportunities in the area.

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Make your rental property more valuable:

If you're determined to list your rental property on OTAs, you can take steps to increase its value and help justify the fees you are paying. Adding and improving amenities, re-painting the property, and purchasing better quality furniture can increase the rental price, justify extra cleaning and maintenance fees, and attract more high-end guests.

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Have an effective direct booking website

Another way to cut down on these types of fees is to invest in a great direct booking website that is SEO-optimized and utilizes tools to increase repeat guests and enhance customer experience.

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When setting up your website, make sure that it allows travelers to find your website easily, engage more deeply with your brand, locate the perfect property, and book from any device.

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Be selective with your bookings:

If you are receiving plenty of guest requests, it is possible to cherry-pick the guests that meet your preferences. By declining or accepting requests based on your preferences, you can tailor your guests to fit the needs, make the most profits and schedule accordingly. This may help increase the value of your rental property, reduce wear and tear damages, and avoid having to pay for additional cleanings.

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Becoming less dependent on OTAs can be a smart move for rental property owners. While these fees can be substantial, there are options for owners who want to keep more of their earnings. To sum it up, hosting on an OTA can be an excellent opportunity to earn a passive income if done right, but hosts must be aware of and plan for the various fees and taxes. By considering other alternatives and diversifying income streams, you may earn more with less fees.

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