Lay My Hat

Guests stayed a few weeks ago have just emailed me to ask about the return of their security deposit from ABNB. They say they are not sure if the final price included a security deposit or not and whether they are due £100.00 back. I was under the impression that the quote would have included the £100.00 but shown separately, and it is not actually charged to them unless I make a claim against it. In which case they are due nothing. Or do ABNB take the money, hold on to it, and then refund it after the stay if I make no claim? I've never used ABNB as a guest so not quite sure how the security deposits work. If I do myself a quote on my listing the deposit definitely shows up. Thanks...

From my ABB listing.

Any guest who confirms a reservation at your listing will be responsible for damages up to this amount. No charges or authorisations will be made unless you make a claim within 48 hours after check out.

So they haven't actually paid anything unless you make a claim.

This is rather worrying in that it implies that Abnb's invoices and communications with the guests are not sufficiently transparent for guests to understand?

In effect, they have paid £100 more for the rental of your property than they thought they were paying. Not an insubstantial sum of money.

Thank you both. I've just done myself a test quote on screen and it only shows the rental amount and guest service fee. The quote makes no mention of the security deposit. Whether it shows it on their itinerary invoice once they've booked I'm not sure. It is indeed very confusing as OD always include the security deposit in the quote. TBH I'm always confused by the booking info they send me and I always have to do the maths to work out if the figures quoted include the host fees.

I've just responded to the guest and explained that they should not have been charged any amount for the security deposit. I certainly hope they don't come back and say that they thought the rental price included the security deposit. To be fair to ABNB there is nothing on the quote screen to suggest that it does.

Login to AB and go to Pricing.
Scroll down and you will see "Additional Pricing Options", under that is "Security Deposit", tick the box and enter the amount you want AB to collect.

AB will collect this amount from the guests for each reservation for that property. AB will retain this amount when they send you the rental on the guests' arrival.

AB will refund the security ddeposit to the guests 10-days after departure. Owners have 48-hours to make a claim against the guests, up to the value held by AB. Any additional claims over this value have to be dealt with by the owner directly.

They do quote it if it's been set up; see snippet below with the quote on the right for the rental and the Security Deposit shown under "Prices".

I don't think they actually charge it at the time though, what I posted above suggests they keep an authorisation for that amount against the credit card. I've actually just increased mine on ABB to double my usual amount. I figured it might be difficult to claim more if I needed to.

HelenB wrote:I don't think they actually charge it at the time though, what I posted above suggests they keep an authorisation for that amount against the credit card. I've actually just increased mine on ABB to double my usual amount. I figured it might be difficult to claim more if I needed to.

You are probably right that a pre-authorisation is used for the security deposit. It is still being "retained" by AB and there is no way a guest can claim that they thought it was in with the rental.

Hi Essar, yes, I've set it up correctly as per your example. I think the confusion is that guests expect the security deposit to be shown in the breakdown to the right and not just mentioned in the listing text. I suppose ABNB do not include it in the quote breakdown because they do not actually charge it to the guest. Quote beside the pricing box that you complete: "No charges or authorisations will be made unless you make a claim within 48 hours after check out".

Thankfully the guest has come back to me and confirmed that she was not charged for the security deposit and therefore, fully accepts that she is not due any refund. However, she was confused as to whether the security deposit was included in the rent quoted.

Now that the question has been answered, permit me some minor TC.

Looking at the quote above from Steve:

1. How does 124 X 7 = 870 ?
2. The booking is for 7 days, so why is there no discount for a week ?

OK, I do know the answer to both questions, but it just illustrates how far AB have yet to go to grasp the full house weekly rental business in terms of presentation.

Agreed e-Richard, I know the answers too and it is not good. I also don't like the way that if a guests requests a quote for a combination of dearer weekend nights and mid week nights (but less than 7 nights) it only shows them an average nightly rate for the period, which is a bit misleading IMO. I think it should be more transparent and show the differing nightly costs so that the guest knows they are paying more for the weekend nights as it may affect their decisions.

Bunny wrote:Agreed e-Richard, I know the answers too and it is not good. I also don't like the way that if a guests requests a quote for a combination of dearer weekend nights and mid week nights (but less than 7 nights) it only shows them an average nightly rate for the period, which is a bit misleading IMO. I think it should be more transparent and show the differing nightly costs so that the guest knows they are paying more for the weekend nights as it may affect their decisions.

Rounding up is always better than rounding down, even if my nightly rates for a week, regardless, of start day will always be the same and consist of only integers. I do resent having to pay the 3% on the extra £2 though!

A LONG LONG TIME AGO IN ANOTHER STAR SYSTEM I decided that I would go along with the pricing systems adopted by all the biggies. I adapted my nightly rates to reflect weekday and weekend nights and use a weekly rate for 7-nights only. All the biggies use the system of proratatering the weekly rate for 7-nights or lonngerer. With AB I don't want to get into a percentage reduction for 7-nights and longer as it dusnee work fer mi. So, I just leave the percentage at zero and let them take all the nightly rates and then prorata. I end up earning more any road up.

I agree with er AB have no understandering of hows holiday rentals work.

In my last corresponderence exchange with AB about this subject I received a computer generated response which bore no real resemberlance to the last message sent. So when they sent me a "how did we do?" message I have them a full salvo, follwed by another email askering "how did I do?" - Santiago respondered with "eh?" - at least someone read it and had a sense of humour.

This 'pre-authorisation' although widespread, is actually illegal in France, and maybe elsewhere too. That is what Societe Generale tell me.

Security deposits are an issue in their own right.

Different niches tend to respond differently. The high end quality market tends to be less disturbed by such requests where some other niches can get quite upset and some guests refuse to book. The discussion is well covered on LMH.

AirBnB should learn from Wyndham Wordwide that a mega brand cannot serve all niches successfully. But AirBnB seems to be compounding the error by trying to sell to BnBs and Self Catering that are very different markets. So far, its vast advertising spend is bludgeoning a way around this problem, but it will not go away. For all that I do not like Wyndham Worldwide, it knows a thing or two about marketing and has decades of experience.

Given the AirBnB attitude of trying to advertise rivals into extinction and its seeming lack of sophistication on the marketing front, the suspicion is that investors are only in there, now, because they see an attractive 'exit strategy'.

If we tried to apply AirBnB systems to our market in Herefordshire and Shropshire, it would be a disastrous mistake.

AB with a $25bn market valuation is totally unrealistic; the company is unable to make a profit on essentially short-break holidays. The investor rounds are staggering and the marketing spend is astounding for a company that is simply a "ONE TRICK PONY".

As Charles says the investors will make a killing sooner of later, but the company will end up as an "also ran". Look at AOL Times Warner a shadow of it's former self, whatever happended to Digital Equipment Corp (the 2nd largest computer co in the world in 1990)? They are either too big and lose the plot or are simply not nimble enough to keep up with changes.

AB will be a prime target for takeover in 3 to 4-years time.