Post by High Priestess on Apr 16, 2016 18:26:32 GMT
I noticed a problem with the resolution center.
I just went to send a refund to a guest who had cancelled his reservation thru the resolution center, and was unable to do so, and realized a problem with the resolution center.
THis is what happened: guest booked 2 weeks in April. He decided to cancel, as he had found another place to stay. -- with a friend. He asked if he could be refunded. I told him I could refund him if I rebooked the dates, less an administrative fee, which I have decided will be $75 per reservation (I got this from a friend who charges that and she is pretty astute so I thought I will up my rate -- I was charging $40). Getting antsy I guess, he issued me a resolution request early on, before I had been able to rebook the dates, asking for the entire amount to be refunded. I declined the resolution request, reminding him that I could only refund him if I rebooked the dates, stating that I had not yet rebooked the dates.
I ended up able to rebook the dates.
THen I went to issue him the refund, and found that the option to send a refund was missing -- his reservation was not among those on the dropdown menu of my reservations when I went to the resolution center, and doubtless this was because a resolution request had already been started by one of us (him) and resolved (declined) by me. Unfortunately, the result of his premature action seems to be that I now am unable to issue him a refund thru Airbnb -- at least in a simple way. IF I have to get on the phone with customer service to resolve this I will have to charge him a higher administrative fee.
Post by Inanna (Shaun) on Apr 16, 2016 21:27:29 GMT
I've had numerous problems with the strict policy, although that is what I use, as I do 30 day rentals. Nonetheless, many times guests have found another place to stay a day or two before arrival and thrown horrid fits about a full refund. Then, sometimes, Airbnb has a few times called me and pressured me to give in to them. What part of "rental contract" do they not understand? The offering to rebook the rooms and give partial refunds with a 75 admin fee sounds good. I will try it.
Post by High Priestess on Apr 16, 2016 22:15:29 GMT
Yes, Inanna (Shaun), I find that offering to refund the guest if I rebook the room has worked out very well. Last year I had 3 guests who each booked a month-plus long stay, and who had to cancel, and I was able to refund each of them in this way. It's a "win-win" situation as they say.
There are a couple down sides from the guest perspective, which is that a host's verbal promise to refund if they can rebook, is not really legally binding (as Andrew points out) and is not something Airbnb can enforce. So a host could concievably go back on their word about this, and in fact I know at least one host who has done so. She promised the guest to refund him in proportion to the amount she rebooked, and then when she rebooked the dates, she ignored the guest when he asked for a refund. ANd as you pointed out, Andrew -- the guest can't tell for sure if host has rebooked any dates.
Then too, to be safe, the host should really not issue the refund until they receive payment from the re-booked reservation. Because there is a possibility that the 2nd guest who booked the space that opened up when the first guest cancelled, may ALSO cancel. ANd if for any reason when that second guest cancels you don't get full payment (eg maybe they cancel with extenuating circumstances and Airbnb upholds a full refund for them, ) then you have lost money, since you issued a refund based on anticipated income that you did not in fact receive. So, a guest could end up waiting a long time for a refund. IF in January they book a 45 day stay in August, then if they cancel that, and you rebook it, even if you rebook it in February, you won't get paid until August and so my advice would be, best practice is to wait to issue the refund in August. So that first guest is then out of that money for 8 months or so.
Depending on the amount of work involved in doing the rebooking, I would perhaps vary the administrative fee I charge. $75 I think would be the minimum, but it could be more for instance if someone cancelled a 2 week stay and you end up having to replace that with 4 separate short reservations, which each took time to obtain.
We have refunded a few guests over the years, before airbnb and on airbnb. We refunded after departure of the replacement guest as we would deduct also damages that can not be recovered from the replacement guest. I explain that to the guests: to help them get more refund, I would accept a guest that I might not accept otherwise but the risk for that lays with the first booker. Never had to deduct a thing so far. But as I announce I would deduct also extra cleaning costs, that resulted in super clean returns in case of early departure. On the other hand, I take a lower fee, which I forego if both guests were easy to handle and all went well.
Post by High Priestess on Apr 16, 2016 23:55:13 GMT
Helga, as usual you think things through amazingly well. I would not have thought about that -- the risk of having damages from the second or replacement guest, which that guest does not pay for and Airbnb will not compensate you for. Some guests would have a hard time accepting that they should be "dinged" for what someone else, potentially far into the future, does at your listing, but it makes sense to argue the case via the promise to the first guest that they will be refunded in PROPORTION to what you are able to recover. And if your profit from the second guest is offset by your loss in damages that you aren't compensated for, then your recovery is thereby diminished by that amount of damages.
So the formula for the amount to be refunded to the first guest would be: Amount to be refunded = Proportion of original booking recovered - administrative fee
Proportion of original booking recovered = ( number of days rebooked X daily rate for the original reservation) - any damages to my property during rebooked reservation, not reimbursed to me by replacement guest or Airbnb
Administrative fee = $75 or more if more work is required
So , let's take this example:
Guest number one booked 2 weeks for let's say $900 total (at a weekly rate of $450/wk or daily rate of $64/day) , and then the replacement guest booked 6 days for $420 total, (at a daily rate of $70 per day) and let's say replacement guest caused $40 of damage to an appliance that was not reimbursed.
Proportion of original booking recovered: 6 days X $64/day = $384 (note that you would not refund the guest the entire amount from the new booking, or $420, because the original guest did not pay at the rate of $70/day as the second guest did, but at a lower rate. You would refund them proportionately by number of days rebooked, not by amount you earn, not least because potentially you could earn more from the replacement guest than the first guest, but secondly the first guest should not be the beneficiary of any additional daily profit you accrue.)
Thus amount to be refunded = $384 - $40 - $75 = $269
Post by Maria Lurdes (Milu) on Apr 17, 2016 0:42:46 GMT
This is a great thread and one that I will bookmark. I don't have that many cancellations and I always stick to my strict policy and refund according to that. I also let guests know that if I rebook the dates, then I have some freedom to reimburse them some or all of the money. I've never found an elegant way of describing this other then to say "I will refund you based on the new earnings", and had given only a basic thought about the various what-ifs, but it's laid out so clearly here, and a good model to use. Also, hello? Admin fee? OF COURSE. It's always a bit of a bother to organize all of this, so of course we should hold back an admin fee in this scenario.
Deborah, yes, you are right with the different daily rates for cancelled long term days replaced by a few short term days. The last such case I refunded, were a couple of Latin American students who found their longterm housing quicker than expected. I calculated days replaced minus laundry and service fee but wrote them something like "Good news: I can refund you 178 Euros. If you have time, I would like to invite you on Friday or Saturday evening to an aperitif and give you the money." Occasion to spend a nice evening, get some info how they lived in my place and how the househunting went, what prices and conditions are asked, by what means they found it etc.