Starting an Airbnb hosting journey in Australia can be exciting as this global OTA platform offers an easy way to earn extra income by listing your home and investment properties in popular tourist destinations. But before you dive into the world of STR hosting, it’s important to understand how Airbnb charges hosts and what percentage of each booking they take.
This article will explore the intricacies of Airbnb hosting fees in Australia to help you understand how they work and what you can expect to pay.
You may also want to check out our blog post to better understand how to navigate Airbnb tax in Australia and be on top of your tax obligations.
Airbnb Hosting Fees in Australia: Why Do You Have to Pay It?
You can list your home or apartment on Airbnb for free without a sign-up fee or subscription cost. And since Airbnb is one of the world’s largest online vacation rental platforms, many hosts in Australia use it to reach millions of travelers looking for a place to stay during their trips.
If you create a compelling listing, set competitive prices, and do your best to make your guests happy, you’ll thrive as a host and will able to grow a successful Airbnb business. If you opt for vacation rental software like Hospitable to automate your routine tasks, you’ll make your STR business more efficient and will be able to scale faster.
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However, running a successful vacation rental business requires more than relying on Airbnb’s best practices. There are also several expenses that you need to consider when planning your Airbnb strategy. One of these standard overhead expenses is the service fees, which are subtracted from the host’s earnings with every confirmed booking.
These hosting fees help Airbnb run smoothly and cover the cost of services the platform provides, including
- 24/7 customer support
- Protection for hosts and their properties via AirCover for Hosts
- Marketing expenses
- Educational resources for hosts online in the Airbnb Help Center
Airbnb Hosting Fees in Australia: How Much Do You Have to Pay?
The host service fee is typically a percentage of the total cost of the booking, including the nightly rate and potential additional fees like cleaning fees and excluding taxes. Currently, there are two different fee structures for stays: a split fee and a host-only fee. When you list your family home, farm stay, or apartment on Airbnb in Australia, you can choose between these hosting fees.
The split fee model is the most common, sharing the cost between hosts and guests. Hosts pay 3% of the booking subtotal, automatically deducted from their payout. Most guests pay under 14.2% of the booking subtotal.
With the host-only fee structure, Airbnb Simplified Pricing, the entire fee is deducted from the host payout. It’s typically 14-16%, but hosts with Super Strict cancellation policies may pay more, and hosting fees for monthly stays may be less.
The Airbnb Simplified Pricing is mandatory for traditional hospitality listings such as hotels, serviced apartments, etc. From November 1, 2020, Simplified Pricing is also mandatory for all software-connected hosts on Airbnb in Australia and New Zealand. That means Airbnb deducts a flat 15% host fee from each payout and doesn’t charge a guest service fee.
If Hospitable is the only software connected to your Airbnb account, the host-only fee may not apply to you. Learn more in our help article.
Airbnb recommends implementing a host-only fee structure since it gives hosts more control over guests’ final prices. You can set what you want guests to pay, and no additional guest fee will be added on top, making your pricing more transparent. Airbnb claims that during the testing phase, hosts who switched to this fee model and set competitive prices for their listings increased their bookings by 17%.
Can You Avoid Paying Host Fees on Airbnb in Australia?
If you rent out your property in Australia on Airbnb, bypassing the platform’s hosting fees completely is impossible. However, you can explore Airbnb alternatives in Australia to diversify your booking channels and use platforms with different fee structures.
A good solution is creating a vacation rental booking website that allows you to accept direct bookings. If you use Hospitable, you can easily build your own fully functional direct booking website using our professional, easy-to-customize templates. This way, you can avoid hefty hosting fees imposed by online booking platforms like Airbnb and keep control of your profits.
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Hospitable Direct has launched a new integration with Google Vacation Rental. Your Hospitable Direct properties will appear on Google Vacation Rentals to increase their visibility and get more bookings. This feature is a standard for hosts who use Direct Basic or Direct Premium.
Travelers can discover your vacation rental property by browsing relevant keywords in Google Search or searching for accommodation using the Google Travel search engine. That means more direct bookings without significant third-party fees.
Final Thought
Airbnb hosting fees are inevitable for all STR hosts in Australia who rent out their properties on this platform, but it’s entirely possible to minimize the impact of these fees on your bottom line. You should optimize your nightly rates to ensure they remain competitive and your Airbnb remains profitable.
You should also diversify your marketing channels by listing on other booking platforms and building your direct booking website. This way, you can show your rentals to a wider audience and make the most of your vacation rental business.
You may also want to check out our blog article, where we share information about the new Airbnb rules in Australia that govern using properties for short-term stays.
