How to Get the Best Airbnb Pricing Strategy for your Property

How to Get the Best Airbnb Pricing Strategy for your Property

Airbnb is the world’s leading community marketplace for people to list, discover, and book accommodations for different seasons whether they are on a vacation, family trip, or business trip. It gives a special offer of its services to a large audience and has more than 33 million listings in over 191 countries.

One of the company’s goals is to create a world where people can belong anywhere.

Airbnb helps rental hosts generate more income by listing their space on Airbnb. It also offers professional guidance on how to be a great host.

For guests, Airbnb offers unique travel experiences by offering amazing short- and long-term property creating a rental market at affordable prices.

There are a lot of things to consider before you decide what fees to charge or even charge extra for your Airbnb rental property.

How much should you decide to charge for a night? What is the minimum number of nights you should require? How can you ensure that you’re getting the most for your property with unique features without pricing yourself and still attracting the target audience? Should you give discounts to attract more customers?

In this article, we’ll discuss how you can get the best price for your Airbnb Property. By following these tips, you can get the best price for your space while still attracting guests. So, let’s get started!

Airbnb Pricing Strategy Explained

Airbnb is a company that provides lodging for travelers, turning them to repeat customers of their services. It is typically cheaper with an easy fee structure rather than staying in hotels, but it can be a bit expensive depending on the location. 

Airbnb’s pricing strategy is often based on the market demand or demand regions for its properties at any given time. 

The prices are adjusted depending on how high or low the demand is at that time. For example, if there are not many people looking to stay at an Airbnb property, the price will be lower than if there are more people looking for places to stay. This way, they can encourage more people to purchase their properties instead of another company’s property.

Airbnb uses an algorithm to determine an optimal price point for a listing. Airbnb does not generate revenue from the direct booking itself, but from the service fee it takes from each guest, which can range from 6% to 20%.

Airbnb’s algorithm determines prices by assessing what other hosts have been charging in similar locations and what guests have been willing to pay for those listings. The strategy of Airbnb’s inventory dynamic pricing is that they don’t just go with a default price for every listing that goes up on their website, they allow the rental market to dictate what people are willing to pay for listings at any given time.

The Ideal Pricing Strategy for your rental Property

There is no one-size-fits-all answer to the question of how much you should charge for your Airbnb rental property. The ideal Airbnb peak pricing strategy will vary depending on a variety of factors, including:

  • Your location
  • The size and type of your accommodation
  • How popular your listing is.

There are four main strategies of pricing: cost-based, competitor-based, demand-based, and profit-maximizing which have their own pros and cons.

  1. Cost-Based Pricing: Airbnb has a cost-based pricing strategy. Airbnb uses this method because it is easy to control and understand. Airbnb can easily calculate how much money they need in order for the business to keep running, so Airbnb’s costs are very tangible numbers which makes managing these figures easier than other companies that have intangible costs such as advertising or research and development.
  2. Competitor-Based Pricing: Airbnb follows this smart pricing strategy by looking at how much their competitors are charging for the same product or service. They also look into what other companies in similar industries are charging. This is not always effective because it can lead to price wars where nobody wins and everyone ends up spending too much money on advertisements trying to get more business than the other.
  3. Demand-Based Pricing: Airbnb’s current pricing rule is based on the demand for their properties at any given time. They raise and lower depending on how high or low the demand is. This type of pricing is effective because it meets market needs with maximum revenue by understanding what people are willing to pay for a product or service.
  4. Profit-Maximizing Pricing: Airbnb has not adopted this smart pricing tool yet, but it is something they might do in the future. This type of pricing rule would involve setting a price that will provide the most profit for Airbnb. They would do this by taking into account how much it costs to produce their product or service, the market demand, and what their competitors are charging.

How to Reach Maximum Occupancy on Airbnb

There are many factors that contribute to the occupancy rate on Airbnb. Through effective management, hosts can maximize their occupancy rates and decrease vacancy rates.

One of the main factors is the price point of a listing. A higher price point will yield more revenue for Airbnb but it also increases demand on a listing. If there is an over-supply in a particular area, then the chances of getting bookings decreases even with a higher price point.

In addition, hosts can use these dynamic pricing tools to increase revenue from their listings by changing prices according to the demand in a particular area at a given time. They also have to make sure that they are not undercutting themselves and losing money because if they do, they risk damaging their reputation and lowering future bookings for themselves.

Airbnb Pricing Strategy Tips

  • Look at other Airbnb listings in your area. Airbnb keeps track of prices for properties around the world, so you can easily see what people are charging for similar properties in your area. Airbnb uses these prices to generate its own pricing algorithm, so if you want to get the best price possible look at what others are charging first. 
  • Use Airbnb’s search function to see the prices other properties similar to yours have been renting out for. Airbnb updates its search results every few minutes, so you can see how prices are changing in real-time.
  • Don’t price yourself out of the market by charging a daily rate instead of a nightly one. A lot of Airbnb pricing strategy comes from choosing the right price per night, as this is Airbnb’s most popular booking option. For example, if you charge $100 as your rate per night with a five-night minimum in cases of extended stays, it would give guests an average cost of $16.66 per person for each day they stay in your Airbnb property—which is still probably too high for most Airbnb travelers looking to book on their site.
  • Charge what guests are willing to pay by looking at Airbnb’s list of booked prices and dates. Airbnb keeps track of how much people have been willing or able to pay for similar properties in your area, so you can easily see what a fair price would be for your listing.
  • Remember to adjust your prices as Airbnb’s algorithm updates them. Airbnb’s pricing algorithm is always changing, so make sure you are regularly checking your listing’s pricing and adjusting it accordingly. This will ensure that you are getting the best price possible for your Airbnb property.
  • Be flexible with your pricing. Airbnb’s search function encourages the guests to filter properties based on price, so make sure you are being flexible with your prices and allowing people to find the right listing for them. This will help you get more bookings in the long run.
  • Use the Automatic Price Suggestion Tool. Airbnb’s automatic price suggestion tool is a good way to determine what your potential guests might be willing to pay for your listing. This will give you a fair idea of what price bracket your listing should be in, which will make it easier for more visitors to find your listing and book it.
  • You can also check out Airbnb’s Pricing Calculator. This calculator will help you find the right price that maximizes your income while still being affordable for guests.

Airbnb is a great way to make some extra money on the side. By following these Airbnb pricing strategy tips, you can make sure that you are getting the most out of your Airbnb listing.


To get the best Airbnb pricing and rentals strategy for your property, make sure you’re in a competitive market and that your prices are comparable to other properties. It’s also important to take into account how much time is left on your listing before it expires when setting rates.

Be mindful of what price point will attract buyers from different demographics because every demographic has its own unique preferences when it comes to budgeting.

The last thing you want is an empty house!

Remember these tips as you go about finding the perfect Airbnb Pricing Strategy for your property so that guests can feel welcome and leave you great reviews after making them feel like they’ve found their new favorite place to stay.

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