The completion of Airbnb’s shift to all US hosts being on 15.5% commission model (opens in new tab) today is cause for me to reflect on my experiences in the industry when Airbnb was first taking off.
HomeAway (now known as Vrbo) was the first major global marketplace for short term rentals. I joined the company in 2010. We had bought dozens of sites around the world and combined them into the largest selection of vacation homes ever. Airbnb was just getting started and we were paying attention, but were focused on our own customers and growth.
We were a subscription classified model with annual listings on Vrbo costing $279 per year - with options to spend $100s more for greater visibility. We went public in 2011, and as a sign of how different the world was our IPO documents only referenced “Airbnb” twice and the other competitors are no longer industry leaders.
Airbnb caught fire with customers because of its natively social product and revolutionary design. It took off like a rocket. My take then and now is that the biggest innovation was actually their business model of charging a low 3% fee to hosts and 6-12% fee to travelers. They offered rooms and shared living products that catered to millennials outside our core family demographic. Their business boomed while ours did well, but we lost market share over time.
By 2015, the position for HomeAway had become untenable. Airbnb marketed as “free to list” and the traveler pays. Hosts loved it and increasingly started there instead of paying our annual fee which felt riskier. I was now the Chief Strategy Officer at HomeAway, and we were getting crushed by Airbnb in Google SEM. They had better booking economics and could more easily win the auction (and as the auction expanded SEO shrank faster than ever).
To compete, we decided to match their approach and offer a commission model in addition to our subscription model. The rest was history, and both companies have since thrived as Vrbo closed the gap and became a more credible (and necessary) alternative to Airbnb’s power.
Fast forward to today, I think the shift away from traveler service fees is smart for Airbnb as a business, but the biggest losers could eventually be their hosts focused on monthly stays. That original 6-12% fee was recently more like 14-16% according to Airbnb. Monthly hosts used to have lower service fees on account of the very long duration and higher value of booked stays. Airbnb used to offer lower traveler service fees closer to 10.5% for long stays, and even lower after 3 months. In recent searches it appears Airbnb now takes just over 12% commission when they fund a discount and over 15% if they don’t.
Airbnb is encouraging hosts to increase their rental rates by 15% to take home the same earnings as in he split fee model. I expect that initially we will see
Tenants pay about the same, but convert slightly better with fewer fees at checkout.
Landlords make about the same, but potentially have higher tax burdens on shorter term stays and face longer term risk on higher commissions.
Airbnb likely makes a bit more, but also earns way more flexibility to raise rates or reduce the long term discounts. Without fees that travelers can see, they may face less pressure to keep discounting.
Interestingly, some taxing authorities may actually lose revenue as the some of the prior tax base was based on traveler fees. Check out the attached Austin example where I assume these taxes go away resulting in opportunity for guests, hosts and ABB to make more money by "splitting the tax."
Airbnb now has a much simpler business model, and also more opportunity to introduce additional hosts fees (like paying for premium search as Booking. com and Vrbo offer) or simply reducing their self funded monthly discounts.
Over the longer term, I expect Vrbo will match the Airbnb approach as they likely won’t want to be the last site with visible traveler fees.
That’s why Furnished Finder exists. We are a throwback to the original promise of the internet: save time, save money and easily shop for more selection. We charge no booking fees to travelers and landlords pay a flat $199 annual fee per property.
We are the largest furnished monthly rental marketplace in the US, with even more paid monthly minimum stay listings than Airbnb and several times more listings than Vrbo, Zillow or Apartments.com. Based on our understanding of recent AirDNA data, more than 40% of Airbnb’s monthly minimum stay rentals have had no bookings in the past year. We are here to help fill these homes with quality tenants so hosts can keep their businesses alive.
We are cheaper than Airbnb for tenants across all bedroom formats, as we take no commissions! That really matters when most of our tenants are traveling for work or out of necessity.
At the new 15.5% commission structure, hosts will pay $930 on a $6,000 3-month booking (Furnished Finder average stay is ~100 days). If you repeat that 4 times a year as many of our landlords do, then you have sent Airbnb $3,720 instead of paying Furnished Finder less than $200 for an entire year of demand. Share the savings with tenants and everyone wins (except maybe Airbnb).
So, in honor of Airbnb changing the game again and moving to 15.5% commission, Furnished Finder is doing the opposite. We’re putting 15.5% back in your pocket as a discount on listing new properties between September 15 - 18th, 2026. Simply use coupon code NOFEE31. For $168 a year, you get control of who you rent to, the ability to communicate however you want, the ability to get paid however you want, and to keep all of your rent. We hope you give us a try.