cancellation refund policy

10 Replies

I charge in advance for the first full week.  It's payable when they move in.  If they leave before the full week is over, I give them credit for their unused days for a future stay.  If they stay longer than one week, I give them a prorated refund.

My recommendation is to start more flexible, and if you start seeing issues, tighten it up accordingly.

We have a totally flexible policy.  At around 90 bookings a month, we typically see 1-2 cancellations per month. We also offer last minute discounts, so we rarely see cancellations end up in unbooked nights on the calendar; even if we don't make as much revenue off those last minutes bookings.

Our typical bookings are 1-3 nights and we're in a city.  If we were in a vacation destination or mostly saw week-long bookings, we'd have a stricter policy.

I just know it's sucked for us, personally, when we've had to change plans do to something like a medical emergency or cancelled flights and we couldn't get a refund. Since we have the choice as hosts, I'd rather be a pleasant surprise than an added frustration. However, I can understand why other hosts do have stricter policies.

I started off with a looser cancellation policy and then made it stricter once I got some good traction.  It also depends on the market - one of my markets doesn't have many last-minute bookings, so I have a strict policy there, since it's unlikely I'll rebook any late cancellations.  Another market has a lot more last-minute bookings, so I don't mind having a less strict policy there.

Even with my strict policy, if someone comes at me with a (believable) story of events outside their control, I'll usually try to refund them IF I get another booking for the same date, at the same rate.  (if it books for less, I refund less, etc)  That way I'm not losing any money but can still offer a courtesy to my guest.

Strict 60 days no refund, 61+ full refund. I Also charge a $100 cancellation fee regardless of how far out the cancelation is made. With every reservation I enter it into my systems, forward to cleaners, and spend my time setting it up. I should be compensated for that time. I do however, make exceptions and will waice the fee should I feel it’s the right and reasonable thing to do... it’s cas by case. Had one cancel last week and her VRBO reason was she found another condo she liked more. Fee not waived lol

The appropriate strategy will vary greatly based on what market you are in, what type/size property you are marketing, and what your guest profile looks like.  Since we manage large homes that only command a premium well in advance, we have a rather strict cancellation/refund policy.  If you had a studio that often books last minute I would recommend a different strategy.

Originally posted by @John D. :

The appropriate strategy will vary greatly based on what market you are in, what type/size property you are marketing, and what your guest profile looks like.  Since we manage large homes that only command a premium well in advance, we have a rather strict cancellation/refund policy.  If you had a studio that often books last minute I would recommend a different strategy.

 That is where I am at a bit of a disadvantage, because we don't really know yet what to expect.

It is a large house that can accomodate 8 to 10 people, 5 miles from Mount Snow in Dover VT.  The house is nice but not high end, mid range is how I would describe it. I am inclined to think that there probably isn't much last minute demand in this market.

Some great ideas here, I am going to think about it more.

@Lee L. , have you listed the property yet?  If you haven't and you're trying to get all your ducks in a row before "going live", I'd set a moderate policy (maybe 30 days) and kick it down the road a little.  You'll have a lot better sense with 3-4 months of bookings under your belt. You can also update the policy at any time.

If you've made the decision to use it as a vacation rental, I would focus on getting it listed and building up some reviews as soon as possible to try and set yourself up for a successful holiday season this winter.