How to manage booking gaps in Medium Term Rentals

Question

I tend to have 2-3 week gaps in my medium-term rental bookings.

Does anyone have a strategy to limit the gaps in between bookings?

Thanks

Allen Duan · Answer

This has been one of the biggest challenges for us managing mid term rentals and I'd love to hear how others handle it. Here's a summary of what I've learned so far.

1. Some people only leave their calendar available for check in for the first week or so after the current booking ends. This is a for sure way to prevent large vacant gaps, but we don't use this strategy because it severely reduces your visibility on Airbnb and other OTAs and could possibly affect your SEO for those sites.

2. I've considered turning off Instant Book for Airbnb, but decided against this because it also hurts your SEO significantly.

3. Our current strategy is all about pricing. I'll try to keep in brief but I'm happy to share more. Essentially you're losing money on those large vacant gaps. Let's say you rent out a property for $4000 a month. If you have a 2 week vacant gap, that's $2000 of potential income lost. What we do is adjust our pricing so the booking that comes after the 2 week gap sells for $2000 more than our normal rate to make up for the lost income of the 2 week gap. In other words, if someone books your property and creates a large vacant gap, they paid enough extra for their booking that you would be ok with the gap.

4. Our secondary strategy for when we do have a larger gap, or even a smaller one, is to sell the extra days at a steep discount for the guests before and after the gap. You're essentially getting $0 for those dates so any amount you can sell them for as an extension or earlier check in is bonus income.

Let me know if you have any questions. I'm happy to elaborate further!

Josh Smith · Answer

@Allen Duan thanks for these ideas! I used to do your option 1 but like you said, it hurt my search results on airbnb.  I thought about option 3, but while that encourages bookings right up against your last booking, doesn't it only encourage discourage longer bookings because the daily price increases as you get further out from your previous booking?

Here's what I'm trying currently, but please poke holes in it because I'm not totally sure this is a sound plan and wondering if this will also kill my search result placement.   :)

My listing is set to a minimum stay of 30 days and max of 90 day (minimum is due to local laws, maximum is just my preference of how long I want people at my house).

I open/make available 3 months from the day my previous booking ends. That first 7 days after my previous booking I don't touch. But for the 8th day through the 90th I create a rule set that the minimum stay is 89 days (which is impossible because there's only 90 days available from the 1st day after my previous booking). Therefore, someone can only book/check-in within the first 7 days after my previous booking and book a stay from 30 to 90 days. If it doesn't book, I will go in and remove that rule set from day 7 to 14 thereby allowing people to book/check-in  that week through the end of my available calendar.

Its a little risky because it basically only makes your calendar available if someone wants to check-in the first week after your last booking but it should stop big unbookable gaps. If I was okay with up to a 2 week gap I could leave the rule set off day 1 to 14 after my last booking.

Joaquin Camarasa · Answer

I am about to start with mid term rentals I should be starting next week so following this post.

I am thinking if you have those gaps is because there is not demand in your area or if there is your unit is worse than the competition, might be price or might be the space.

I have two questions,

1. Do you show during the last two weeks of stay of the tenant that rents the unit. I was thinking to reach an agreement with tenant and put this in place.

2. I was also planning to just state to new tenant that unit rents to be rented from a specific date even if it a bit inconvenient for them. Let's say they want to access it November 3rd, I'd state it needs to be rented from November 1st if needed.

Again it goes back to the amount of demand you have. For what I have analyzed my area should allow me to put either of this two options in place.

Joey Banasihan · Answer

@Joe Gee - I haven't run into this yet but I am currently preparing for it, and I will be using both Furnish Finder and AirBnb as my platforms. Furnish Finder for my typical 13 week traveling nurses and AirBnB for those 2 - 3 weeks of gaps inbetween.

The further step you could take is to begin idetnifying agencies in your market that work with hospitals, larger corporations, etc, that help assign and find medium term stays for traveling professionals.  Building a relatoinship with these folks could help build a better funnel of tenants outside of these larger platforms, and maybe get rid of those gap weeks in general.

Just some ideas to through out there and hopefully you are able to get those gaps filled with bookings!

Bonnie Low · Answer

It would really be hard to give proper advice about your occupancy rate without knowing more about your property. Who are you targeting? Where are you marketing or listing it? What are the specifics of the property type itself. If you could provide more information I'm sure people here could help you troubleshoot. It's always helpful to share a link to your listing as well.

Allen Duan · Answer

@Josh Smith You're welcome!

One negative affect of option 3 is that it would make longer bookings overpriced. I'm ok with that because for most MTR bookings, there's some discussion back and forth and negotiation on the rent. That's when I can offer a better discounted rate if they're dates are ideal for our calendar. The prices doesn't continually go up the further out the dates are. Past 2 months, our rates are set at our default rate. The logic there is if we get a 2-3 month gap, I'm confident we can rent that out.

Your strategy makes sense. Like you said, it would limit anyone from finding your listing if they have dates beyond those first 7 vacant dates. But if that's by design, that's fine. I personally wouldn't want that for my listings. I prefer having the visibility in search results and the possibility of someone booking at a really high rate, or just asking me for a better rate because they like the listing =)

Joe Gee · Answer

The main problem is that Airbnb will not let me book anything below 30 days. They work hand in hand with my city (New Orleans) to follow the regulations in place. It's priced well, and the demand is there, but there's nothing I can do within that 2-3 week gap because Airbnb will not let me book anything below 30 days.

Now I often get it perfect and a guest leaves on the 30th, and a new guest books on the 1st or 2nd.  But if they book on the 15th, that 2 weeks of no pay.

I recently heard of taking the listing off of "Insta book" so I can approve or decline bookings to time it right. So going to try that strategy.  Will update the post to see how it goes.

How to manage booking gaps in Medium Term Rentals

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