So, you have a property you’d like to rent out, but you have no idea where to start. The differences between rental platforms can be quite subtle, and that’s why we’re here to help break it down for you. Let’s find out which company is better for owners: Airbnb vs. HomeAway?
Airbnb is a well-established platform that reaches a large audience that is fairly affordable for hosts to use, and allows diverse property types to be listed. However, HomeAway offers owners their choice of service fee plans, potential rewards they can earn, and easy direct deposit payouts.
It’s impossible to claim that one rental platform is universally better for all owners, so we won’t! Instead, we’ll take you through the specifics of both Airbnb and HomeAway so you can decide which website is best for you.
Airbnb: An Overview
Airbnb has become a household name when it comes to travel rentals. These days, it’s most people’s first choice for a home rental when on vacation – aside from hotels, that is.
However, Airbnbs might even be giving them a run for their money. Let’s take a closer look at what the Airbnb hype is all about and how exactly it works for owners.
What Is Airbnb?
Airbnb is typically thought of as the market leader for vacation rentals. While other similar companies have been bought out or merged, Airbnb has stayed independent since it launched in 2008.
Since it went public, Airbnb has listed over 6 million rentals in more than 65,000 cities. Airbnb draws in significant web traffic, with their site averaging 88 million visits each month. The site is so popular that a 2016 study led by Ryerson University reported that 61% of participants said they’d choose an Airbnb over an affordable hotel room.
That’s a huge amount of market share!
Property Types Allowed on Airbnb
Airbnb is a go-to among many travelers for a unique reason – owners can list portions of their property. Shared spaces are great for tourists looking to save a few dollars and allow you to easily rake in some extra cash without owning multiple properties.
For example, if you want to rent out a spare bedroom or half of your apartment, you’re welcome to do so on Airbnb. Likewise, if you’d rather list your entire home, cabin, or castle, go for it!
Airbnb isn’t just for rentals, though. You can also use this platform to host Experiences. These can include anything from walking tours to paint nights to cooking classes. If this piques your interest, you can double-dip in the Airbnb hosting glory!
How Does Management Work?
How you want to manage your property is entirely up to you. With Airbnb, you have the choice of taking care of your space and listing entirely by yourself or not at all.
If you feel capable – and more importantly, if you want to – you can be the one solely responsible for the hosting experience.
This doesn’t just mean making the space look pretty or responding to questions as they come up. Being the property manager entails coordinating with cleaners, organizing an easy check-in and check-out experience, and managing your taxes, among many other duties.
Think of yourself as taking on all front-desk, concierge, housekeeping, and management positions at a hotel. If you’re ready to take this on, Airbnb lets you start your management journey directly on their website, or you can use your own software provider.
Airbnb has a growing list of software partners that they prefer to work with, which takes out some of the guesswork and research to find a reliable company to work with. If you choose from this list, you can guarantee that they already know how Airbnb’s platform works and that their services are compatible with the website.
Some people absolutely love taking this under their wings or at least love saving some money from not having to outsource these jobs. Others aren’t so into that idea. If the latter sounds more like you, there, luckily, are other options for you.
Airbnb gives you the option to hire a property management company to do this work on your behalf. There are tons of Airbnb property managers out there who offer services that range from full maintenance to specific, standalone amenities, so you can find a provider that’s ideal for you.
How Does Booking Work?
Being an Airbnb host doesn’t mean you have to blindly allow anyone to stay in your home. Airbnb’s booking system allows you to set up your booking platform in a few different ways.
If you’re comfortable with it, you can allow guests to book your space instantly – no waiting or intervention on your part is necessary.
This method is more similar to booking a room at a hotel. If you’re ready to pay, the place is yours. Some hosts prefer this structure as it lets their guests book immediately, which might make them a few more dollars. It’s also easier for the host if they don’t have to go back and forth with a guest before securing their spot.
On the other hand, this is your space. You might not be comfortable just letting anyone into your home. This is totally reasonable! Airbnb understands this, and that’s why they also give you the choice of structuring your reservations in a way that requires your confirmation first. If you go for this setup, guests can request to book your place, and then you have 24 hours to accept or deny their rental.
A third option is to pre-approve potential guests who inquire about renting your space. Sometimes people will contact you with questions before they decide they’re ready to book. If this happens, you can follow up on your response by sending them a pre-approved reservation invitation. All this means is that they won’t have to send a request when they do decide they’re going to rent your place – they can just proceed with payment.
How Do I Get Paid?
Airbnb offers payments through several different platforms. These methods include the following:
- ACH/Direct deposit
- AIS card
- Bank transfer
- International wire
- Payoneer Prepaid Debit Card
- Western Union
Your payment process is usually initiated by Airbnb 24 hours after your guest is scheduled to check-in. However, processing times can vary depending on the payment method you choose, so it may be a few business days before you receive your payout. Long-term stays (think 28 days or more) may be paid monthly instead.
What Do I Have to Pay?
Airbnb’s payment platform for renters is pretty straight forward. There are two fees that Airbnb charges and must be paid for: the service fee and the guest fee. As the host, you can choose to cover these yourself or to split them between you and your guest.
A split-fee payment is the most common structure used by Airbnb hosts. All this means is that the host pays their share of the service fee, 3%, and their guests pay 14.2%.
Alternatively, hosts can opt to pay the fee in its entirety. It is mandatory for some owners, including hotels, to pay the host-only fee, but most can choose to split it. If you want to eat the cost yourself, be prepared to dish out 14-16% in fees.
How Do Reviews Work?
Airbnb reviews are a two-way street. You, the owner, can leave comments and ratings on the guests that stay in your home, and they can do the same for you. After a stay is completed, both parties have up to two weeks to submit their reviews of each other.
While the names of both you and your guest are tied to your reviews, the rating you leave only becomes visible to them once they’ve completed theirs, too (or after these 14 days pass).
Reviews play a big role in how the Airbnb search algorithm works. If you get more favorable reviews, the higher you’ll rank when a potential guest is on the hunt for a place to stay in your area.
Airbnb Customer Service and Extras
You can call Airbnb for customer support 24/7, but this is usually not the best way to receive a technician’s assistance. Before speaking to a representative directly, you’ll have to answer some pre-screening questions. Typically, Airbnb’s phone support is more suited for emergency use.
The company does provide other platforms to serve you, though, such as email or the Airbnb Help Twitter account.
Airbnb enhances user experience by promoting top owners to “Superhosts.” This coveted distinction highlights owners who maintain a certain set of requirements, including a 4.8 rating and maintaining at least a 90% response rate.
Superhosts benefit from the title by earning more money, enticing more guests, and receiving special rewards.
Travelers often adjust their filters so they can scroll exclusively through Superhosts. Airbnb screens hosts quarterly, so you have plenty of chances to gain this status – or lose it!
Pros and Cons of Airbnbs
All great things have their unfortunate downfalls too. We’ll let you decide if Airbnb’s pros outweigh their cons. Here are some of the ways Airbnb hit a home run and places where they’ve missed the mark.
Pros of Airbnbs
- Airbnb is the go-to site for rentals. Based solely on numbers alone, it’s clear that Airbnb is the default choice for vacation rentals and fun overnight stays. Using Airbnb to list your place means that it will reach a broad audience, and your rental has a greater chance of being booked.
- You can list any type of property on Airbnb. There are few limitations in what kind of properties can be rented on Airbnb. Whether you just have a spare bedroom, a campground, RV or a remote cabin getaway, Airbnb will let you list it. The site also lets guests filter out what kinds of stays they’d prefer to rent.
- Service fees for hosts can be quite low on Airbnb. All rental platforms will charge you some sort of fee so they can make a commission on your sales, but Airbnb’s is actually very affordable. You’ll only have to pay the company 3% of your rental revenue. That’s not too bad.
Cons of Airbnbs
Split-fees on Airbnb charge the guest a whopping extra 14.2%. While the option to choose a split-fee setup saves the host, you, from paying a high service fee, someone’s gotta make Airbnb their money. Unfortunately, this structure charges your guest quite a bit of extra money. Some Airbnb users may find this surprise charge a turn-off from the site, but they’re still the go-to site in the rental market, so maybe it’s not that much of a factor.
With so many other listings on Airbnb, yours might get drowned out. There is something to be said for advertising your rental on a website that sees a lot of traffic. Still, Airbnb’s popularity means you’ll likely have many competitors with similar properties in your area. You may even find yourself dropping your nightly rate to give yourself an edge, but underselling yourself is never good for your bottom line. This is why it’s critical to have top tier photography for your listing.
HomeAway: An Overview
HomeAway might not be the first platform that pops into your head when you’re thinking of vacation home rentals, but that’s not necessarily a bad thing.
Don’t count this company out just yet!
HomeAway/Vrbo is quite popular for certain types of vacation travelers, so keep reading to learn more about how it works and its potential advantages over other booking services like Airbnb.
What Is HomeAway?
HomeAway is a world leader in vacation rentals, so you’ll be in good company if you choose to opt for this platform. The Austin, Texas-based network was launched in 2006 and has since branched out to 190 different countries with over 2 million listings.
9 years into its life, the renowned travel network Expedia Group bought out HomeAway for $3.9 billion. Other familiar brands that make up the Expedia Group include Trivago, Hotels.com, Travelocity, and, of course, Expedia.
In July of 2020, HomeAway merged with another rental booking company under the Expedia Group, VRBO, to create one central page. The HomeAway website now redirects to Vrbo, an acronym that stands for “vacation rental by owner.” These days, the combined website draws in a monthly average of 14 million visitors.
Don’t worry — if you’re familiar with HomeAway, you shouldn’t have any trouble navigating around Vrbo. Plus, all of the rentals previously listed on either of the formerly independent sites are still posted on the merged platform.
Despite the rebranding, I’ll continue referring to this entity as HomeAway throughout the rest of this article for the sake of consistency.
Property Types Allowed on HomeAway
Unlike on Airbnb, all listings on HomeAway must be entire properties.
This means that you can’t post a rental for one room in your house or a basement suite. Instead, HomeAway hosts must guarantee that renters will have access to your space privately.
How Does Management Work?
HomeAway provides two options for hosts: managing their own property or hiring a property management company. Both of these choices have their own unique advantages.
Keeping your property owner managed means you have complete control over everything. You will be responsible for running your own business. This means creating and updating the listing accordingly, taking care of the property, and remedying any problems that may arise. While this provides complete autonomy, it is also a lot of work.
Using a property management company to handle your listing can take a lot of the responsibility off of you, the owner. These companies ensure your property is promoted, finances are handled, and any maintenance is taken care of.
Be prepared to spend between 8-15% of your rental income on property management if you choose this option.
How Does Booking Work?
Just like Airbnb, HomeAway gives hosts choices when it comes to how their properties are booked. Listings can be featured as “instant books” or “24-hour confirmation,” and both are exactly how they sound.
With the first option, guests can immediately reserve and pay for your space, so you can sit back and watch your dates fill up.
If you feel more secure vetting people before they enter your home, opt for 24-hour confirmation. This way, you can approve or decline potential guests and have a bit more say in who stays in your house.
How Do I Get Paid?
HomeAway exclusively pays owners through direct deposit into their bank accounts.
While the company doesn’t give you a say in your payment methods, direct deposit is typically seen as the most convenient way to get your money. It is the way most conventional employers pay their staff, so it is a solid process.
Most of the time, payouts are processed by HomeAway one business day after your guests’ check-in time. After this, the time it takes to receive your money depends on your bank, but usually, the money makes its way into your pockets five to seven business days after it’s been processed.
What Do I Have to Pay?
Like with their property management, HomeAway offers different options for paying service fees. You can strategically choose which method is more cost-effective for you based on your ideal booking situation.
One option is paying a small fee of 8-10% each time your home is booked. This amount includes a 5% service charge, a 3% fee for processing credit cards, and a potential 2% payment for the use of non-American credit cards.
Your other choice is paying a flat rate for an annual subscription, which may be a great option if your property has a high occupancy.
Currently, this fee is 499 USD (640 CAD). If you plan on renting your home frequently, or if your nightly rates are relatively high, it might be best to choose this option.
To put it in perspective, if you’re bringing in more than $10,000 from rentals annually, you can save some money in the long run by opting to pay the subscription fee upfront.
Depending on where your rental is located, HomeAway may collect and submit taxes on your behalf too. You can find out more about VAT (Value-Added Tax), A.K.A. GST (Goods and Services Tax) by visiting HomeAway’s VAT page or consulting a tax advisor.
Also, note that HomeAway charges guests 10-11% extra in fees on their side. Unlike Airbnb, there is no way for you to absorb this fee instead of your guest. This doesn’t affect you directly, but the additional cost may influence whether or not people want to book with HomeAway.
How Do Reviews Work?
HomeAway’s review system is quite similar to that of Airbnb. After your guest has checked out, you will be prompted to review one another.
Completing this step is important as it helps other potential hosts make up their minds about whether or not they’d like this guest in their home.
Guests will also be allowed to review you, so you should aim to impress as the HomeAway algorithm favors hosts with higher ratings.
You can be honest in your feedback as your guest won’t see what you’ve written until they submit their ratings and vice versa. HomeAway gives you up to a year to complete your review, but if your counterpart starts theirs first, you’ll have to provide your comments within 14 days.
HomeAway Customer Service and Extras
HomeAway’s customer service may be considered more on-demand than Airbnb’s. They offer email, chat, and 24/7 phone support options to serve you.
If HomeAway is a fan of your property and guests love to stay there, you might be invited to become a Premier Host. This will grant you exclusive access to free marketing potentials, a badge on your listings, and visibility in the designated Premier Host filter.
On top of this, Premier Hosts can subscribe to Boost: a program that gives you “power-ups” you can use to optimize your listing in search results. This can be incredibly beneficial during slower times of the year when your home isn’t getting as much turnover.
Pros and Cons of HomeAway
HomeAway gives hosts a lot of wiggle room for how they want to structure their listing. On the other hand, they also are pretty stringent in other ways. Take a look at some areas in which HomeAway excels and some places they are unfortunately lacking.
Pros of HomeAway
You have more time to write your review for guests. Turning your property over between rentals in a timely fashion can be stressful enough as it is without having to worry about other details like reviewing your guests. On HomeAway, you have up to a year to begin yours. This leaves you with ample time to attend to other pressing tasks like cleaning the house or possibly balancing your rental listings with other jobs.
This is also handy as it allows new owners to compare guest stays before writing a review without having the prior rental experience to compare it to. However, if your guest submits their review of you first, your allotted time to complete yours drops down to 14 days.
HomeAway offers Premier Hosts great rewards such as Boosts. It’s always nice to be appreciated for your hard work, and HomeAway does just this by offering rewards to their Premier Hosts. Boosts give you advantages like promoting your property during low seasons. This is a great reason to strive to be the best at what you do.
There are options for how to pay HomeAway host fees. Some companies can really drag you down with the commissions they earn off the properties you rent. While HomeAway does take some of your revenue, they give you the choice to pay an annual amount or take a percentage off every payout. You can save some money by choosing your payment plan strategically based on how much you plan to rent.
Cons of HomeAway
- Only full-property rentals are allowed on HomeAway. If you want to list your luxurious, newly renovated basement suite, you’re out of luck. This platform only lets you post rentals where your guests have exclusive access to the whole house. While this can be great for renters, it significantly limits who can host a HomeAway.
- The only payout method HomeAway uses is direct deposit. Unfortunately, you’ll have to be comfortable dishing out some banking info with HomeAway if you want to use their platform. Well, if you want to get paid, that is. This is a pretty standard payment method for most employers, but we understand you may be a bit hesitant to share this online.
Which One Is Right for You?
As we talked about, there are advantages and drawbacks to both Airbnb and HomeAway.
So, which one is best suited to you, your needs, and your property? Think about the following questions to determine which platform will be more beneficial for you to post your listing on:
What Type of Property Do You Have?
If you want to list a property that isn’t fully private, like an apartment or suite, you’ll have to choose Airbnb by default as HomeAway does not accept these kinds of postings. If you do want to list an entire home, though, the decision won’t be as easy.
Older, more mature guests that have larger groups tend to book HomeAway properties, and they do it much farther in advance than Airbnb. Airbnb, on the other hand, tends to attract younger travelers who book properties closer to their travel dates.
Are You Okay With Posting Your Listing on a More Saturated Platform if It Means It Can Reach More Potential Guests?
It’s no secret that Airbnb reaches a greater audience than HomeAway, but that kind of stretch also comes at a cost. Yes, you will have more potential guests seeing your listing, but you also have more competition and can get overshadowed easily.
With a more heavily saturated market, you may end up underselling your property to come across as more desirable. There’s a greater chance your place will be seen on HomeAway, but fewer people visit this site. The question is: which one will earn you more money?
Would You Rather Give Yourself or Your Renter a Financial Break?
Fees can add up quickly. There’s no doubt about that. Airbnb’s host fee is a mere 3%, but their guest service fee is 14.2%. Alternatively, you have the option to cover your guest’s fee, which might make your stay more desirable, but you’ll get stuck paying 14-16% of your revenue.
HomeAway, on the other hand, offers different plans for their host fees, so you can save some money there. However, there’s no escaping the guest fee, which adds up to 10-11%. The question is, would you rather be stuck paying out a larger amount, or will you leave that to your renter?
This can certainly make a difference between conversion rates and the bottom line.
Both Airbnb and HomeAway have their own unique advantages for owners.
If you’d like to rent out a portion of your property or reach a huge audience, Airbnb is the way to go. On the other hand, if you strive to be exclusively rewarded for hosting excellence and would prefer to have lots of say in your listing, HomeAway is going to be more suited to you.
Another option is to list on both platforms and sync your calendar, so when someone books the entire property on HomeAway it becomes unavailable for those days on Airbnb.
However, with the differences in policies and procedures, keeping up with both platforms can get confusing.