Airbnb's 15.5% Commission: What Hosts Need to Do Now

If you've been tuning into Airbnb's news lately, well, you know that they're taking away the guest service fees, like a hotel, for example, that doesn't charge the guest service fees, and they're passing them all over to the host, all over to you. Whether your property's connected to an PMS system or whether it's only on Airbnb, there are some important changes that you need to make. And it's not just as easy as marking your property up by 15.5%, which is what Airbnb is going to be charging

the host. So, stay tuned. Let's dive into all the details, everything you need to know to make sure that your property is set up correctly. Why is Airbnb making this change on October 27th of 2025? If you're listening to this afterwards, well, hopefully you've already made these adjustments, but these are permanent and they do affect everyone. If we go back a little bit and we look at Airbnb's history, they started as air bed and breakfast, right? That's the Airbnb. They were literally renting out mattresses in

their property or their spare rooms in San Francisco. And they charged a 3% fee for hosts, which was very appealing for anyone that had previously been on DBO or Booking.com or any of these other platforms that were charging a lot more. And really, they were charging this just to cover credit card fees. And so, because they had this attractive commission rate, they were able to grow really, really quickly, aside from all the other things that Airbnb did really well. So now fast forward years later, they

are competing with Booking.com, who's been charging 15% for the longest time. Brbo has a variable rate, but it can be as high as 15%. Expedia, all these different platforms have a much higher rate that the host or the property owner is paying, and the guest fee is disappearing. There's a little bit of misinformation out there that this is only going to affect people that have their properties connected to Airbnb through a PMS. And that's true except for in the very near future on December 1st, every

host is going to be paying for all of the service fees. And you might be thinking, well, hosts that aren't connected to the PMS system, if they're not paying all those service fees, then they're going to have an unfair advantage. Not necessarily. We're going to break down all the math. Actually, that's not the case at all. as long as you have things marked up correct. So, how should you mark up your pricing? Well, the first thing is if you do nothing at all and October 27th

rolls around and you're now paying this 15 12% commission, well, then that means that you're just earning less money. Now, it's not exactly 15.5% from Airbnb. There are a couple things that could change that slightly. If you're using a super strict cancellation policy, for example, then you're going to be paying an extra 2%. And if you're hosting the long-term stays, 28 days or longer, then it might be slightly less than the 15.5%. So, let's start with all of you that have your Airbnb property connected to

a PMS software like Guesty or Hostfully or Streamline, you're going to need to add a markup. And I know you're probably thinking, okay, well, I'll just add 15.5%. That should cover the difference. But if we actually look at the math, that is not the case. It needs to be slightly higher than that. Let's say that before this change you were earning $100. That was your gross payout. And you want things to stay the same. Well, you're actually going to need to mark your prices up by

$18.34%. Now, I know that sounds a little bit confusing, but if we look at the math, if we just added $15.5 to the 100 to cover the 15.5%. So, that would be 100 plus 15.5, $115.50. If we discount that 15.5%, we're actually going to wind up lower than $100. So, we'll be earning less than we have been before. So, the correct percentage is 18.34%. That is the amount that you're going to want to put as your markup in your property management software. Now, this markup isn't

going to apply to your whole reservation cost if you're setting this up in your PMS software because that markup only applies to the reservation. So, you're going to have to consider what your cleaning fee is if you have any other sorts of fees. Let's say those amount to $200 per reservation. Well, none of this markup is getting applied to those. So, you want to make sure that you adjust those accordingly. You increase those because the markup on Airbnb's end is going to discount your whole reservation.

Now, you may be thinking, Tim, I don't want to do this markup, or at least I don't want to do the full markup because I know that hosts that aren't connected to a PMS software aren't going to be charged this until December 1st. So, eventually, they will. But the reality is our guests aren't going to see any of these service fees. Luckily, there was a law passed just recently in California which changed the format that Airbnb shows a guest. So, now if you go on Airbnb

as a guest, you will not see the service fees. you will not see the cleaning fee. So, the price, assuming you've put in this markup, is going to be basically exactly the same for your guest and they will have never known otherwise. So, no, as long as you put this markup in there, there will not be an unfair advantage between you connected to PMS software and another Airbnb host that isn't, as long as you've put that 18.34% markup in there, and you've also considered for your

additional fees where that markup would not be applying. And then of course, probably by the time most of you are seeing this video, all of the hosts connected just to Airbnb are going to be paying the same commission anyways. And another quick note on the cleaning fees. I know a lot of you out there are just charging the cleaning fee that you pay the cost to you. But if we look at the fact that guests are just seeing the whole reservation price, then what you pay

for your cleaning fee shouldn't matter, right? You need to make sure that your total reservation price is as competitive as possible. and that's going to lead to more reservations. Of course, at the end of the day, you don't want to be losing money. So, if you have one night stays or short stays and your cleaning fee is high, you'll have to take that into account. And just one last note, let this be a reminder, this change from Airbnb that you really don't have much control at

all over these OTAA listing sites. So, you want to be as diversified as possible. You want to make sure that you're on all the different platforms and that you, of course, have a way for guests to book directly. If you're new to the show, well, you can go to strries.com. We have episodes talking about all of the different channels, the best way to put your property on there, and the best ways to stay competitive. We also have a lot of free ebooks there to help you

along your short-term rental journey. I hope you found this episode insightful. And remember, October 27th, that is a date. 18.34% is what you're going to want to mark up your properties. Till next time, I hope you have a fabulous week.