Guest Refunds: Everything Hosts Should Know

Most of the time, you don’t have to worry about guests asking for a refund. However, there are unfortunate events that can happen. Even when you have a good plan laid out, something beyond your control can still go wrong.

So, how do you deal with guest refunds for your Airbnb property?

This blog post will help you understand how to create an Airbnb refund policy and deal with guest refunds.

Guest Refunds: When Are They Applicable?

Guests are allowed to ask for a refund, but a host should know the limitations surrounding the process. As you know, returns are not exactly good for business.

No matter what your guest’s reason may be, it pays to know about the Guest Refund Policy that Airbnb has structured for hosts. Some of the common issues that are found on an Airbnb refund policy include:

1. Unresponsive Hosts

A noncommittal host is someone who cancels a guest’s reservation within 24 hours after the person has already checked in. In such a case, the guest will get an easy refund process. The same applies to a host who decided to change the accommodation offered to the guest.

Unresponsive hosts also include those who provide incorrect lockbox codes. As a result, the guests will not be able to access the property.

2. Unsafe and Dirty Properties

If the guest does not feel safe in the neighbourhood or the house itself, a refund may be issued. Safety issues also relate to infestations, mould, and broken locks.

When you let a person or a group of individuals stay in your property, it means you are ready to welcome them at any time. There is always an agreed check-in time, which gives you an estimate regarding when the guests will arrive. Usually, you get a lot of time in between guests.

Therefore, you should make sure the property is in good condition. Dirty sheets and towels, rubbish on the floor, or overflowing waste bins can quickly cost you a refund.

3. Wrong Listing Descriptions

Be honest about your listing and your guests will be much less likely to ask for a refund

Perhaps you just made a mistake in your listing. For instance, you stated that you have a four-bedroom home, but you forgot to mention one room is used as storage. Many guests take such misstatements seriously. And Airbnb can require you to issue a refund because of them.

Ensure that everything that you put in your listing is correct and accurate (this guide will help). You cannot tell your potential guests that you have a private pool if it is shared. You cannot say that your home is right in the CBD if you are an hour away. You get the picture – be honest.

4. Problems During Stay

Some guests will complain about everything. Luckily, Airbnb protects hosts from these problematic lodgers who will find a small issue to be grumpy about. However, if there is a significant problem while the guest is in your home, it is another story. For instance, your heater stopped working during winter, or the windows do not close properly.

If the cooktop is not functioning and your guests always have to dine out, they can ask for a refund. Airbnb will support them. As a host, it is your responsibility to make sure none of these issues are present.

Yes, you could encounter some guests who may be forgiving. Still, you need to organise a repair when needed.

How Does the Refund Policy Work?

Let us now say that a guest did ask for a refund. You may not know what to do if it is your first time. It can be disappointing, but you have to handle the situation like a pro.

If the guest talks directly to you and asks for a refund, some cases allow you to issue a refund right away. One example is if the person contacts you before the date they were supposed to check-in. You can issue a refund by going to your Airbnb dashboard and the Reservations overview. Find the booking and choose the button for a refund.

The process becomes a bit more complicated when the refund request is past the check-in date. You need to talk to the guest first. At this point, you should already know why they are asking for a refund. You may also want to determine what kind of refund would appease the guest.

Once you have discussed these things with the guest, you can head back to your dashboard and the Resolution Centre. Find the reservation that requires a refund and provide the reason. From here, you can choose to give a partial reimbursement, along with the amount (and currency) that you wish to send back to the guest. You can also leave a message for them.

The guest can either accept or reject your offer. If approved, Airbnb will provide a refund within 48 hours. Some guests prefer to contact Airbnb directly to get a refund. They should do so within 24 hours since the issue or complaint has surfaced.

You Can Construct Your Cancellation Policy

Airbnb gives you the power to create your own cancellation policy structure based on a range of options, namely the following:

1. Flexible Cancellation

If you go for this option, you allow your guests to freely cancel without any penalties if they withdraw their booking 14 days before checking in. The free cancellation still applies even if they cancel less than 14 days before the scheduled check-in. For instance, the booking was made seven days before checking in. They can cancel 48 hours after the reservation and up to 24 hours before they should be on your property.

If the guest does cancel a day before checking in, they only get a refund for the nightly rate. It also includes the cleaning fee, but the service fee is yours to keep.

2. Moderate Cancellation

If you choose a moderate cancellation policy, cancellation is free 14 days before checking in. If the reservation is less than 14 days from the actual check-in schedule, free cancellation is only applicable if they cancel 48 hours after booking. It is also allowed that you give them a refund if they cancel five days prior to checking in. However, they will only get a refund of the nightly rate and the cleaning charges. Other fees, especially the service fee, cannot be returned to them.

3. Strict Cancellation

Free cancellation is provided within 48 hours. However, the guest should cancel right away – at least two weeks before the expected arrival. Guests can cancel up to seven days before the check-in. Unlike other cancellation policies, they will only receive a 50% refund of the nightly rate and housekeeping costs.

Cancellations for Long-Term Guests

If you have guests who will stay for 28 nights or more, you can set up a different cancellation policy. Typically, Airbnb allows guests to cancel before they check-in and still get a full refund. However, the refund will not include the first 30 days, as well as the service charges.

Admittedly, it is much harder to deal with long-term guests, which is why two Super Strict policies are available:

• Super Strict 30 Days: Airbnb gives this policy as invitation-only. Therefore, just a few hosts can take advantage of the procedure under particular circumstances. The guests are allowed to cancel 30 days (or more) before the check-in. They will get a 50% refund of both the cleaning and nightly rate. However, they will not receive the service fee back.
• Super Strict 60 Days: Once again, this policy is by invitation-only. The same rule above applies, except that guests can cancel at least 60 days before they are scheduled to check in to your property. They will also get a 50% refund.

Special Update

Because of the coronavirus pandemic, known as COVID-19, Airbnb businesses are affected. The company has made certain adjustments to its cancellation policy.

Certain listings and bookings are more affected than others. Airbnb’s policy covers some cancellations while others are not. Make sure that you know about these recent changes through their official documentation found on their website.

How BnB Hosts Can Help

BnB Hosts can help with a range of Airbnb management issues.

In many situations, you can prevent guests from demanding a refund. With the assistance of BnB hosts, it will be much easier to take care of guest liaison. We have a team of professionals that will make sure your home is clean from top to bottom. Issues are often avoidable if you have an active crew ready to keep an eye on the most common and uncommon problems.

Sometimes, certain circumstances cannot be prevented. Still, they should be managed right away to avoid any conflict with the guests.

BnB Hosts will make your life easier, so pick up the phone and call us for a consultation today!