3 Replies Latest reply: Jul 5, 2019 9:47 AM by hmmmm RSS

    Refundable Damage Deposit

    ashevillelookout Senior Contributor
    ashevillelookout Jul 5, 2019 6:13 AM

      Why is this NOT a helpful statement?

       

      From the Discovery Hub:  Build an additional amount into your nightly rate instead of using a refundable damage deposit.  This helps eliminate the perception of an extra fee.  You can use those funds in case of damage at any point.

       

      1.  A damage deposit, when billed and collected separately, tends to make guests aware of the need to take care of the property as their money is on the line.

      2.  A damage deposit, if built into the nightly rate, will also be calculated in the VRBO Service Fee, thereby providing more money to VRBO.

      3.  A damage deposit, if built into the nightly rate, may cause the homeowner to no longer be competitive with other owners in their market, unless all owners are building in the same amount into their nightly rate, i.e., everyone in the market raises their nightly rate by X%. 

       

      There are many other reasons that a homeowner would not want to build their damage deposit into their nightly rate.  These three reasons are sufficient for me to not follow the above advice. 

        • Re: Refundable Damage Deposit
          greggt Senior Contributor
          greggt Jul 5, 2019 7:33 AM (in response to ashevillelookout)

          To me it shows a complete lack of understanding by HA on renting out a private residence to complete strangers. The Whole purpose of collecting a damage deposit is a reminder to those strangers to treat your property with some respect or they might get charged for the damage.

          The old saying, "Skin in the Game" making a difference, is very true.

          • Re: Refundable Damage Deposit
            twobitrentals CommunityAmbassador
            twobitrentals Jul 5, 2019 8:50 AM (in response to ashevillelookout)

            Wild iris posted a similar thread on this too

            • Re: Refundable Damage Deposit
              hmmmm Senior Contributor
              hmmmm Jul 5, 2019 9:47 AM (in response to ashevillelookout)

              Always, Always get a refundable security/damage deposit.  Its is a very important incentive for the vacationers to take care of the home, stay with the rules, and leave it in good condition.

               

              This should not be built in as then it is not a stated collection.  Are you really going to build in a "refundable" $500.00 to $1000.00 into your nightly rates?


              With the contract properly stated about the refundable sec/dam deposit, initialed and signed contract, your duel, security/damage deposit will be a fall back for you to use.


              The insurance policy is not for you.  If you do not collect, you do not have a way of recouping, should the "vacationer's insurance" again not yours, can be utilized.

               

              Homes are not hotels, you have no one looking out for you if you do not look out for yourself.


              Your home, your liability, your responsibility, your $$$, take care of yourself and your property

               

              Due to the saturation of STVRs in San Diego's beach areas, my rates are lower than they were 10 years ago now to compete with AirBnB's influx, of everybody and their brothers renting out everything from rooms to garages in San Diego.  No room to build in an extra $500.00

               

              I will keep it as a security/damage deposit.