HomeAway Announces 5 Tier Pricing Model to End July 11

April 29, 2016
Categories: Airbnb

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HomeAway, parent to Vacation Rentals by Owner (VRBO), just announced a dramatic change to the pricing structure for property listings. Beginning July 11, 2016, the company will stop selling and renewing the multi-level subscription plans for Platinum, Gold, Silver, Bronze and Classic. The company will only sell annual subscriptions at a flat rate of $349 when online booking is enabled or $499 when online booking is not enabled. The company will also allow the pay per booking option where there is no upfront fee but a commission is charged for each booking. The pay-per-booking commission rate has been reduced from 10% to 8%, but the percentage will also be applied to mandatory fees. The transition to the new pricing structure will occur gradually over the next year depending on when the owner’s existing subscription expires. The company also announced that all listings will get regional and international exposure on the company’s top 25 international sites at no additional charge.

The tier pricing structure was the determining factor of where a particular property would appear in the search results. The company now will use a “best match” algorithm to display the listings, which are the closest match to the guests search criteria for travel dates, location etc.  The company believes this change will result in more successful bookings. It is also designed to encourage owners to enable online bookings.

The company said there would be no change to the guest fee introduced two months ago which generated a lot of complaints from owners. Many owners believe the guest fee has drastically reduced the number of bookings they are getting on their rental properties. Some owners have already initiated a class action suit against the company. Expedia, who purchased the company late last year, disputes the guest fee has hurt bookings on the site.

Property owners will be prompted to renew beginning 120 days before their current expiration date.  Owners can also renew their current subscription level for one year, as long as they act before July 11, 2016.  All owners will receive the reminder to renew, even if their settings are for “auto-renew.” The requirement to manually renew is due to a change in the pricing and the terms and conditions.

The changes in the terms and conditions include: offering both property and traveler reviews, a termination clause where non-compliance with rental regulations or nuisance patterns as a reason to terminate a listing, allows HomeAway to pursue members whose actions or inaction cause HomeAway to compensate a traveler for a loss through the guarantee program, search results will be based on the latitude and longitude of the address not the area the owner has selected.

You can view the company details on the change here.

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