Airbnb cancellation policy options for hosts in 2022 - Pikl

Airbnb cancellation policy options for hosts in 2022

Not sure which Airbnb Host Cancellation policy option is best for you? Learn how to easily cancel a guest reservation to save time and money.

Hosts using Airbnb should be prepared for unforeseen circumstances that result in cancellations. Airbnb provides several different cancellation options that hosts can select for each listing as well as some strict options. This article will cover how they work, how to cancel a reservation and how best to avoid having to do this.

What are the Airbnb host cancellation options available?

How to cancel a reservation as a host (and what are the penalties)

Tips for avoiding cancellations

Can an Airbnb host change a cancellation after booking?

Key Airbnb cancellation takeaways

What are the Airbnb host cancellation options available?

Airbnb hosts have several options in terms of what cancellation policy they want to set for hosts, including:

  1. Flexible
  2. Moderate
  3. Firm
  4. Strict
  5. Strict long term
  6. Flexible long term
  7. Non refundable
  8. Super strict 30 days
  9. Super strict 60 days

Let’s have a look at each one in more detail, including the pros and cons of each.

Flexible cancellation

With the flexible option, guests have up until 24 hours before the scheduled check in to cancel their booking. Guests that do this get a full refund.

If a guest cancels after this, hosts get paid for each night the guests stays plus an additional night.

Pros and cons of flexible cancellation

Flexible cancellations are not the most host friendly options. If your listing is in a popular area then receiving a cancellation at short notice could lose you money too.

For a guest however, then this type of cancellation is very appealing. If you really need more bookings or are looking for a way to stand out from the competition, then this option may suit you. So long as you are aware of its potential pitfalls.

Moderate cancellation

With this version, guests have the option to cancel their booking up to 5 days prior the scheduled check in.

If a guest cancels after this, hosts get paid for every night they stay as well as one additional night and 50% for all unused nights.

Pros and cons of moderate cancellation

Moderate seeks to strike a balance between flexible and more strict cancellation options. As a host you could attract more guests by leaving it fairly close until check in date. It also gives you more time if the guest cancels before the 5 days. You’ll be compensated better too.

Whether this is good enough for you will depend on your listing. Is your property regularly booked? Would it be easy enough to find another listing if the guest cancelled 6 days before check in? If the answer is no then this option probably isn’t for you.

Firm cancellation

Guests have to cancel at least 30 days prior to the scheduled check in date to be eligible for a full refund. If the guest cancels between 7-30 days prior to the local check-in time, you’ll receive 50% of the total booking cost for all nights. Hosts will receive 100% of the total booking cost if cancellation is less than 7 days before scheduled check in.

Guests can receive a full refund if they cancel within 48 hours of booking. However, the cancellation must be at least 14 days prior to the check-in.

Pros and cons of firm cancellation

If you’re worried about losing income then a firm cancellation policy will compensate you better and give you more time to look for new bookings if a guest cancels at least 30 days prior.

The stricter your cancellation policy, the less appealing this could be to guests. But what if you are confident that you’ll have plenty of guests booking anyway? In that case this option could work for you.

Strict cancellation

To receive a full refund, guests must cancel within 48 hours of booking. Cancellation must occur at least 14 days before check-in. If they cancel between 7 and 14 days before check-in, your payment will equate to 50% of the total rate for all nights. If guests cancel after that, you’ll receive 100% payment for all nights.

Pros and cons of strict cancellation

Many guests may be put off by the idea of not getting a full refund if they don’t cancel within 48 hours of booking. But if protecting your income is important to you then this option may be more suitable.

Strict long term

This long-term option applies to bookings that are 28 days or more and so standard cancellation rules don’t apply here. To receive a full refund, guests must cancel within 48 hours of making their booking. For the full refund to be eligible this must also be at least 28 days before the scheduled local check-in.

What if a guest cancels after that? In those situations you’ll be paid all the everything for all the nights spent and 30 additional nights too.

For guests cancelling with less than 30 days remaining you’ll be paid 100% for all of the remaining nights.

Pros and cons of strict long term cancellation

For longer term bookings, this protects the host a lot more. Some guests may be put off by the idea of not getting a refund if they don’t cancel within 48 hours of booking. But if they’ve already made plans to stay somewhere for a longer time (e.g work) then this may not be an issue.

Flexible long term

Like the strict long term version, this applies to stays of 28 days or over and overrides the standard cancellation policy for the duration of the stay.

Guests have to cancel at least 30 days before check in to get a refund under this option. Cancellations after this mean that you get paid 100% for all nights plus 30 additional nights.

If fewer than 30 days remain on the booking when the guest cancels, you get paid 100% for all of the nights remaining.

Pros and cons of flexible long term cancellation

Guests may still incur costly penalties under this option. But unlike strict long term, guests don’t have to cancel within 48 hours of booking. And if a guest does cancel at least 30 days before booking, that may give you a reasonable time to find an alternative.

Non-refundable option

Hosts can add this as an option for guests in additional to their chosen cancellation policy. The guest can choose this option when booking in return for a slightly reduced rate.

Pros and cons of non-refundable cancellation

Some hosts earn more money by providing a non-refundable option. Guests could be attracted to paying less on a booking and hosts will not have to worry about losing money should they cancel.

Some guests may be put off by non-refundable cancellation but the good news is that this is optional. Hosts considering doing this need to work out if they will get enough bookings to offset the slightly reduced rate for guests choosing this option.

Super Strict 30 days cancellation

Guests get a 50% refund for cancelling under this option as long a they do this within at least 30 days prior to check in. Cancellation after this means that the host gets paid 100% for all nights.

Pros and cons of Super Strict 30 day cancellation

This option is only available through invitation only under special circumstances so it is not easily accessible for everyone. Like other stricter cancellation options it offers more protection for hosts but may not be appealing to guests.

Super Strict 60 days cancellation

This is almost the same as the 30 day super strict option except that this time the guest has to cancel within 60 days before arrival to get a 50% refund for all nights.

Pros and cons of Super Strict 60 day cancellation

Similar pros and cons apply as mentioned in Super Strict 30 days above. Making your cancellation this strict may not seem that appealing to guests however unless you have a good reason to do this.

Exceptions to this rule that allow free Airbnb cancellations

Sometimes standard cancellation rules do not apply. Guests can cancel bookings without adverse consequences and receive a full refund if there are extenuating circumstances.

There are also other cases where Airbnb may override your cancellation policy as a host. This an include situations such as where the host is not contactable, is unwilling to deal with a serious issue or the property is not safe.

For Airbnb luxe bookings, hosts are required to adhere to a different set of policies for these listings. According to Airbnb, a guest’s refund rights under Airbnb Luxe retreats supersedes a host’s cancellation policy.

How to cancel a guest reservation as a host (and what are the penalties)

Hosts can cancel a booking on their side although circumstances in which this is permitted are limited. Due to the disruption these cancellations have on guests plans, Airbnb limits the amount of penalty free cancellations a host can make.

Cancelling a booking

To cancel a booking, select the listing you want to cancel. In the booking settings you can scroll down to policies. Click edit next to cancellation policy and then save.

Cancelling itself can be fairly straightforward but doing so without a penalty rests on whether you are doing so for a valid reason.

Airbnb expects hosts to fulfil reservations unless it’s a case of extenuating circumstances. Hosts are also responsible for informing guests of cancellations promptly.

If you need to cancel a booking less than 24 hours before the check-in, Airbnb’s online cancellation form is not available. Hosts must contact Airbnb support to deal with this immediately.

Airbnb echo that cancellation reasons must not violate Airbnb’s Non-discrimination Policy.

Potential cancellation penalties

Unless this is covered under Airbnb’s extenuating circumstances, you’ll likely have to pay a penalty if you decide to cancel. But what are the penalties if this happens?

If you cancel a confirmed booking, a fee is deducted from your first pay out after cancellation so the next pay out you receive from Airbnb will be affected. How much is deducted depends on when you accepted the booking. Airbnb state on their website that $50 is charged if you cancel more then 7 days before check in and $100 if this is less than 7 days.

There are also further potential consequences if you cancel a confirmed reservation. Your calendar could be blocked out by Airbnb. An automated review will also be posted to your listing confirming that you cancelled one of your reservations. Your account could also be suspended or deactivated. If you are a Superhost, you could lose this status.

The best thing you can do as a host is to carefully think about the right cancellation option for you. Avoiding these kinds of problems will help you keep both yourself and guests happy.

Avoiding a cancellation penalty

If you’re wondering about what Airbnb’s free cancellation policy options are, there are some available but they are limited for hosts.

If you want to cancel due to extenuating circumstances, Airbnb will take into consideration how soon you made the guest aware.

Suspicion of unauthorised parties occurring at your property is also another factor that Airbnb will consider in allowing an Airbnb host free cancellation. Airbnb will investigate the matter by gathering evidence such as messages and previous reviews for the guest.

Hosts that have instant bookings turned on are allowed free cancellation when it is clear a guest has broken any of the rules set out in the listing. This can include smoking or bringing a pet.

Hosts can cancel if the listing does not fit the needs of the guest. For example, a guest could rush a booking without reading a description that may have important information.

Hosts can also cancel if they have concerns about a booking after looking at a guest’s profile and reviews.

Airbnb offer three free host cancellation opportunities for the above reasons per year. After you have used three hosts should contact Airbnb directly. Hosts who don’t contact Airbnb and cancel more than 3 times in a year may have a penalty applied to their account.

You should avoid cancelling many instant bookings as Airbnb may demand you to turn off this option for your listing.

Tips for avoiding cancellations

Setting the right cancellation policy that works for you is the best way to avoid you having to make booking cancellations. But sometimes it can be unavoidable. Here are some things you can do in advance to make cancellation less likely.

Maintain your property

Would you like to stay at a property that was unclean or poorly maintained? Most would not. There will always be someone capable of being unhappy with even the most minor of issues but hosts still need to keep the basics right.

Keep your property clean, tidy and maintained. Most guests expect this as a bare minimum.

Maintaining your property doesn’t just have to be about keeping the property looking nice however. Many hosts are unaware that the cover provided by Airbnb if something goes wrong may not fully cover you. Most standard insurers also don’t provide full cover either. At Pikl, we provide Airbnb insurance cover built especially for hosts. Click on the button below to get a quote today.

Plan your calendar availability

Planning your calendar availability in advance is crucial in avoiding booking cancellations.

The first step you will need to take as a host is to establish the dates in the year where you can’t rent your property and block out these dates. If you don’t do this then you run the risk of accepting bookings on dates where you aren’t able to fulfil this. This could be especially problematic if you have instant bookings turned on.

If you also list your property on platforms other than Airbnb, you will need to make sure that you are not overbooking on particular dates either. Booking and calendar management software can make this easier.

Hosts should establish how much notice before a booking they would need before accepting a booking. This allows the host to fully prepare the property for guests. If you allow guests to book one day prior but live far from the property, you might want to consider implementing a longer notice period.

Communicate with your guests

As we’ve repeated elsewhere, communicating with your guest is important in case you need to cancel promptly, should an issue arise. The same applies to avoiding cancellations too.

Many disputes arise due to poor communication. If a guest has paid for a booking, they were probably happy with your listing. But don’t assume they have everything they need.

Some guests may have particular needs or requirements and may appreciate it if you go out of your way to make reasonable efforts to accommodate them.

If a guest does not have any reviews, reach out to them. It’s important however to follow Airbnb’s non discriminatory policy when doing their due diligence on guests.

Make sure your listing is clear

Be sure to be a descriptive as possible when presenting your listing. As a host you can’t mention or take a photograph of everything but make sure that the key facts are covered. Take clear photographs of the key areas in your property and mention key facts that potential guests may want to know about.

Set sensible ground rules

Your house, your rules. Setting house rules for the guest to follow is important so that both parties know where everything stands. At the same time, don’t set rules that guests are unlikely to follow and may not appreciate.

Be honest

It’s understandable that hosts want to present their listing in the best light possible but it’s crucial not to be misleading. If you miss out something important or lie to the guest, they won’t be happy if they find out!

Change your reservation

This one probably seems a bit obvious on the face of it, but consider asking the guest to change the date of the booking if you have not already considered this and need to cancel. If you have another property free, you may also want to consider asking them to book that one instead.

You’ll need to contact Airbnb if you need to change a reservation 24 hours before booking. If the booking is more than 24 hours away then follow these steps to change the reservation:

  1. Select the reservation you want to change in the reservations section.
  2. Once you’ve selected the details option you can opt to change your reservation.
  3. You should then be in the reservation details section, where you can make changes to the dates of the booking.
  4. Enter the new accommodation cost under guest charges.
  5. Review all of your changes once you have done this. Select send request once you are done.

It’s up to the guest to accept your request once you have done this. The guest has the right to decline or not respond and this would mean that the original reservation remains unchanged. The guest’s payment has to be made within 48 hours or change will be automatically declined.

Depending on your circumstances, requesting a reservation change may be the best option before cancelling if you have exhausted all other viable options.

Can an Airbnb Host change the cancellation policy after booking?

Hosts do have the ability to alter their cancellation policy at any time. However, if the booking is already confirmed then the cancellation policy cannot be modified.

Your new chosen policy will take effect for all future bookings. Think carefully about the pros and cons of each cancellation policy before setting one.

Key takeaways

Whilst not the most exciting subject, choosing the right cancellation option for your listing could be important when it comes to both attracting more bookings and avoiding potential hassle later on down the line.

Knowing the potential penalties for cancelling a booking as a host and focusing on strategies that reduce the likelihood of this occurring will make your life much easier and allow you to focus on other things.

And when thinking about reducing potential scenarios that could involve hassle or loss of income, don’t forget to take out Airbnb insurance like the kind we provide at Pikl to give you extra peace of mind.