A recent analysis of pricing for accommodations in major cities across the U.S. confirmed what many travelers already knew: Airbnb is not really a cheaper alternative to hotels.
According to a study by Upgraded Points, staying at an Airbnb is usually more expensive than staying at a hotel, although the type of accommodation had a major impact on the findings. Airbnb offers the option of renting an “entire place” or a room within a residence. Upgraded Points compared the cost of both Airbnb options against the cost renting a room for two people for one night at a hotel in 50 U.S. cities through Hotels.com.
Airbnb was the undisputed winner in the room-to-room comparison, besting hotel prices in all 50 cities. Las Vegas boasted the greatest difference in cost, with a savings of $269 when renting a room through Airbnb versus a hotel. The smallest savings came in Orlando, Florida, with a mere $7.30.
Graphic by upgradedpoints.com
When using Airbnb, though, most travelers choose to rent the entire place instead of just a single room in a residence. In fact, 81 percent of Airbnb’s revenue in 2017 came from whole-unit rentals. In this comparison, the results were nearly the opposite of room-to-room. For rentals of the entire place versus a stay at a hotel, the survey found hotels were cheaper in all but four cities (Baltimore, Detroit, Las Vegas, and New Orleans), and the differences were quite large in some cities. In Los Angeles, for example, an entire place rented through Airbnb was $328 more expensive than a hotel room. In Miami, the difference was $303.
Graphic by upgradedpoints.com
There are a number of explanations for the differences in this particular comparison, though. Hotels hit hard by pandemic-induced travel bans have been offering reduced rates to lure back guests to fill their many vacant rooms. While those rates might still be more than Airbnb single-room rentals, that’s not always the case for renting an entire place. The study confirmed another sore point with Airbnb users: the service fees and cleaning costs which can sometimes account for up to half of the final bill. In fact, folks renting an entire place in Orlando through Airbnb can expect an additional 53 percent in taxes and fees in their bill. On average, the survey found entire-place rentals saw on average an additional 40 percent in taxes and fees in their final bill.
The topic of exorbitant fees has been hot one for Airbnb. Earlier this year a user posted a copy of a bill showing his $99 per night rental ballooned to over $413 after adding fees and taxes for a two-night stay.
Airbnb offered explanations for its fee structure on its website, but the study from Upgraded Points showed the online rental service still has some work to do in this area.
While the study showed sometimes significant disparities in pricing between Airbnb and hotels, it did fail to take into account what folks are getting in return for that extra cost. The rental of an entire place through Airbnb is just that, renting the entire place. This will often include multiple bedrooms and bathrooms, a separate living area, a kitchen and yard, as well as other amenities. Also, many Airbnb rentals are in locations more suited for a particular traveler’s tastes, such as a quieter residential area for families or a fully contained unit near a specific location or activity.
You can learn more about the study from Upgraded Points, including a complete data set, at upgradedpoints.com.