Airbnb dynamic pricing: how it works and how to automate it

What dynamic pricing means for a vacation rental

A flat rate is wrong most of the year. It is too high on a quiet Tuesday in February, so the night stays empty. It is too low on a sunny August weekend, so you sell the night in a day and leave money on the table. Dynamic pricing (also called automatic Airbnb prices or yield management) simply gives every night its own price, based on how likely that night is to sell.

The idea is not to charge as much as possible. It is to match the price to demand, night by night, so that fewer nights stay empty and the nights that are in demand are not given away.

How to set dynamic prices by hand

You can do a reasonable job with a spreadsheet and half an hour a week. The method is always the same.

1. Pick a base price for an ordinary night, and a floor below which you would rather leave the night empty (your costs plus a margin).
2. Look at five to ten listings that really resemble yours nearby: same size, same kind of place, same neighbourhood. Check their prices and, above all, their calendars. A calendar that is already full tells you more than a price tag.
3. Adjust for the calendar: high season, weekends, public holidays and school holidays in the countries your guests come from.
4. Adjust for the time left before arrival. A night three months away does not need the same price as a night three days away that is still free.
5. Review it again every week. Demand moves.

Mistakes that cost hosts the most

• Copying a neighbour's price. Their listing, photos and reviews are not yours.
• Comparing prices only, without looking at which listings are actually booked.
• Dropping the price on every empty night. A discount works best when the arrival is close, not as a reflex.
• Ignoring the minimum stay. A three-night minimum on a gap of one night means that night never sells.
• Setting prices once in January and not touching them again.

Minimum stay and gaps between bookings

Price is only half of it. Between two bookings you often have one or two free nights that nobody can book because your minimum stay is longer. Lowering the minimum stay for those nights, and raising it in peak season when guests accept longer trips, fills gaps without cutting the price. Doing this by hand means checking the calendar every few days, which is exactly the kind of task that gets forgotten.

What Clear Conscience does

Every week, we read the prices and calendars of listings like yours around you. The price of each night follows from that, is reviewed every day, and is sent to Airbnb, Booking.com and your direct booking page, so the same price applies everywhere.

• Season, weekends, public holidays and school holidays are taken into account.
• So are how full the area is and how far off the arrival is.
• The minimum stay is tuned to the season, so single nights between two bookings still sell.
• A non-refundable rate is offered only if you want one: a discount for guests who give up free cancellation, on Airbnb and Booking.com. By default, only the standard rate is offered.

Every month you get a report on what moved on your listings (bookings, average price, occupancy, revenue), and a person reviews your pricing strategy. If you are curious how your current rate compares with listings around you, the free diagnostic takes about a minute.

What you keep control of

You set a minimum and a maximum nightly price, and the standard rate never leaves that range. You can change both at any time from your account. Your listings stay on your own Airbnb and Booking.com accounts, and there is no commitment: you pay by the month and can cancel any month.

Dynamic pricing is included in the single €39 per listing per month, excluding VAT with everything else, and you get an automatic discount from two listings. If you want the wider picture first, read how to price your Airbnb.