Vacation Rental Damage Deposits

Short-Term & Vacation Rental Discussions
3yFollow

Vacation Rental Damage Deposits

Matt Owens
Investor · Coeur d'Alene, ID · Member since 2023 · 20 posts · 15 votes

Hey All,

Do any of you require damage deposits from guests for booking your vacation rentals?

I recently acquired and launched a new property on Airbnb and VRBO that is $500-$600 avg. nightly rate compared to other properties I’m managing at a $150-$250 avg. nightly rate. 

I have never required a damage deposit in the past but for this one I’m curious to hear what you think?  I’m leaning towards NO because I want to limit as many barriers as possible when someone is considering my listing over others in the area. 

TIA

0Reply
43 views

Most Popular Reply

John UnderwoodPro Member
Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
3y

Even if you set an amount for a deposit you don't get to hold the deposit anymore and have to file a claim to get any reimbursement for damages.


Inset the damage deposit high since the guests doesn't actually have to pay it unless there are actual damages proven.


If your one of the unfortunate ones that get most of their bookings from Airbnb dont count on them to take your side over the guest. 

If you do have damages document it with pictures and receipts and report it to the listing platform immediately.

2Reply
See this reply in the discussion

6 Replies

Jump to latestLatest
  • John UnderwoodPro Member
    Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
    3y

    Even if you set an amount for a deposit you don't get to hold the deposit anymore and have to file a claim to get any reimbursement for damages.


    Inset the damage deposit high since the guests doesn't actually have to pay it unless there are actual damages proven.


    If your one of the unfortunate ones that get most of their bookings from Airbnb dont count on them to take your side over the guest. 

    If you do have damages document it with pictures and receipts and report it to the listing platform immediately.

    2Reply
  • Matt Mertz
    Leander TX · Member since 2020 · 179 posts · 150 votes
    3y

    Yes.  We require a $750 security deposit on our large 16 person cabin ($750 is 2x our cleaning fee).  We do this primarily as a psychological tool to respect our property.  Also we prefer to have this under our control rather than leaving it up to Airbnb's aircover.

    We use OwnerRez which has integrations to payment processors, VRBO and Airbnb that allows us to charge the security hold.  Airbnb doesn't give you this capability without software as far as I know.

    Since we've implemented this, we only had to draw from a security deposit one time.  We didn't need to appeal to Airbnb.  We just took $375 from the security hold to cover the big mess that guest left with no issues.

    1Reply
  • Michael BaumPro Member
    Olympia, WA · Member since 2016 · 8k+ posts · 7k+ votes
    3y

    We have a $500 damage deposit. Skin in the game baby.

    1Reply
  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    3y

    We used to use security deposits. Now we just keep a card on file.

    The DIY Landlord Book4.7243 Reviews
    WebsiteView Page
    0Reply
  • Leslie Anne Morris
    Real Estate Agent · Smoky Mountains, TN · Member since 2022 · 1k+ posts · 984 votes
    3y

    You could go damage deposit or security deposit route.  They are both different.  You don't need both.  Security deposit would be you authorizing and holding an amount on their credit card.  Damage deposit would be offered by a third party company.  Either way you'll need a PMS such as Ownerrez which we use at my property management company in the Smoky Mountains.

    1Reply
  • Andrew SteffensBusiness Member
    Tampa, FL · Member since 2022 · 4k+ posts · 3k+ votes
    3y

    We do damage waivers, since we have 80 +/- units we charge the guest a damage waiver a small fee and depending on the unit the protection is $1000-2000.  If they break something they do not have to worry about it, and neither does the owner.  This only works if you have enough units/reservations per month

    [email protected]813-563-0877
    Vacation Rentals of Florida53 Reviews
    WebsiteView Page
    0Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free