At Vacasa, we’ve spent the last decade perfecting vacation rental pricing so our homeowners can make the most out of their investment. Our proprietary dynamic pricing technology—combined with the expertise of regionally focused revenue analysts—has enabled us to consistently deliver higher profits for vacation homeowners and become North America’s leading vacation rental management company.
For a look at how it all works, we’ve outlined our playbook below—or you can tune into this short webinar with our resident rates expert, Natalia Sutin, to learn more about Vacasa’s dynamic pricing.
Demand isn’t always consistent, so why should pricing be? Big data and machine learning are allowing companies across industries to charge fluid prices that adjust based on market conditions. And here at Vacasa, we’re leading the vacation rental industry with this tech-enabled approach to pricing.
Powered by machine learning, our dynamic pricing system monitors rates throughout the day and makes changes in response to changes in demand. It knows when to command peak pricing—say, for a holiday weekend or a popular event—and when to adjust for softening demand in order to keep the bookings coming. This method of dynamic pricing relies on advanced algorithms that factor in millions of data points to set the right price at the right time.
As this technology becomes more widely adopted, fixed prices are becoming a thing of the past in many digital marketplaces.
But we don’t leave it all up to machine learning. We pair our industry-leading technology with regionally focused analysts, so you benefit from the best of both worlds. Your dedicated regional analyst monitors your home’s performance and fine-tunes the algorithm for optimal impact. This one-two punch of technology and human expertise helps us deliver vacation homeowners around the world the best return on investment—especially during more volatile times.
We don’t just look at what’s happening in the moment to set rates—instead, we look at the big picture. We analyze the booking pace of your market, then compare that to the current and historic pace of your home and its competition, slowly adjusting rates to deliver the best return. Through this system, we can deliver you the optimal rate by booking your home at the optimal moment.
Sometimes, optimizing your revenue means shortening the booking window (how far in advance guests book). For example, you may be used to seeing your peak season calendar fill up months in advance. That’s convenient for property managers who have to manually book out their homes, but it can leave money on the table.
Imagine for a minute that your bookings are retail products. Early bookings for peak season are a bit like discounted retail products at a Black Friday sale. Your bookings may fly off the shelves, but your product is selling at a sub-par price point. By waiting for the availability of homes to shrink, and decreasing your booking window alongside it, we’re able to hold out for the optimum rate and drive more revenue for your home.
Your first bookings position your home for long-term success. They’re crucial for two reasons: getting your home prominently featured on booking sites like Vrbo and Airbnb, and getting positive reviews.
Many of our major booking partners have a ramp-up period during which they judge how desirable your listing is for guests—and how highly it deserves to be ranked on the site’s platform. We build a perfect listing with eye-catching copy and images to meet these sites’ extensive criteria, but we also need to show early conversions (bookings) to demonstrate guests’ interest in your home. Our system can help entice last-minute reservations by gently lowering rates on upcoming available days. So, while you may notice lower rates when your home first goes live with Vacasa, this strategy of promoting last-minute bookings is key to helping us capture those first guests (and reviews) early on.
As your home’s listing ranks higher on booking sites and your number of positive reviews increases, we are able to attract guests at a peak market rate. More reviews lead to more bookings, improving your conversion score and, as a result, your ranking and ability to command higher prices, too. It creates a positive feedback loop—and we call that a win-win.
Avoid setting minimum rates that limit dynamic pricing and block your ability to maximize booking activity.
Homeowners who have never experienced dynamic pricing may be hesitant to embrace a pricing strategy that involves variable rates. We understand it’s a new approach for many. But our data shows that the best way to deliver more revenue is by dynamically adjusting rates.
Our system is all about specifics and can adjust one nightly rate to optimize your overall revenue. For example, if we see most people booking three-day weekends (checking in on Thursday and checking out on Sunday), we may drop the nightly rate on Wednesday so guests are encouraged to book four nights instead of three. While the average daily rate (ADR) is lower for the four-night trip, incentivizing the extra night ultimately results in more revenue for your home.
Though the difference seems small for one reservation, the more competitive ADR benefits revenue in the long run. We know through experience that having competitive pricing for a home in the off-season adds up and, in turn, increases conversion to put your home in a stronger position when peak season hits.
Our dynamic pricing technology is designed to help you win the long game, earning higher annual revenue. We might not advertise the highest rate every night—but we charge the smartest rate (remember the pricing feedback loop?) to get you the best return overall.
Though it may take lowering the rate on an individual night, the benefit of turning a three-night stay into a five-night stay, or raising occupancy by an extra 10 percent during the off-season, really adds up over time—especially as your review count increases.
If you’re not already one of our valued homeowners, let’s talk. We’re confident we can earn you more money with our dynamic pricing system, which you now know all about.
Our rates are based on a number of variables, including seasonal weather patterns, holidays, location-specific events, competitor pricing, demand elasticity for your home, occupancy rates, booking window trends, current sales and promotions, regional demand trends, proximity to local landmarks, seasonal demand curves, changes in demand, and much more.
Here are some of our top tips:
Dynamic pricing is the best way to optimize your vacation rental’s profits and performance. It analyzes real-time market data like day of the week, competition, seasonality, current demand, and upcoming local events to adjust your rates accordingly. Your rental rates are updated daily to reflect all the fluctuations in data. The result: Get booked at the best price, for the right time.
Airbnb hosts can create their own prices or opt into Airbnb’s pricing tool, which features many dynamic pricing functions. Their tool, Smart Pricing, can be turned on or off whenever you’d like. It analyzes data like local demand, average number of people who view your property, average review scores, and quality of your amenities. Then, it automatically updates your listing price to match the demand, but only within a minimum and maximum price that you set.
There are several ways to determine your nightly rental rate. These include understanding your operation costs, looking at your competitors’ rates (not to duplicate, but to gauge the market), researching upcoming holidays and local events that could possibly boost demand, and preparing for inevitable vacancies. If you’re willing to invest in vacation rental pricing software, some options include RateIntelligence and MarketMaker.
At Vacasa, we use dynamic pricing (leveraging proprietary technology and regional experts and analysts) to set the optimal rate for each of our homes. Changes in demand can happen in real time. So, your rates are updated daily to reflect the current demand for your home.
Call 866-668-4282 to speak with a Homeowner Consultant, who can answer preliminary questions and see if we’d be a good fit for you.
If you'd like to move forward, we’ll put you in touch with our market expert in your neighborhood to explore the financial potential of your home, outline our management fee, and introduce your local team.
Vacasa offers property management and other real estate services directly through Vacasa LLC and through Vacasa LLC's licensed subsidiaries. Click here for more information about Vacasa's licensed real estate brokerage/property manager in your state. Vacasa’s licensed real estate brokerages/property managers include: Vacasa Alabama LLC; Vacasa Arizona LLC; Vacasa Delaware LLC, 302-541-8999; Vacasa Florida LLC; Vacasa Louisiana LLC, Dana MacCord, Principal Broker, ph 504.252.0155 (Licensed in LA); Vacasa Michigan LLC, 947-800-5979; Vacasa Missouri LLC, Susan Scanlon, Designated Broker; Vacasa Nevada LLC; Vacasa New Hampshire LLC, P.O. Box 283, Conway NH 03818, Dave Grant, Broker of Record; Vacasa New Mexico LLC, 503-345-9399; Vacasa New York LLC, 888-433-0068, Susan E. Scanlon, Real Estate Broker; Vacasa North Carolina LLC; Vacasa Pennsylvania LLC; Vacasa Real Estate Corporation, California DRE #02105811, Joseph Czapkowicz, California DRE #01380722; Vacation Palm Springs Real Estate, Inc., California DRE #01523013, Joseph Czapkowicz, California DRE #01380722; Vacasa Real Estate LLC (licensed in Colorado, Daned Kirkham); Vacasa Real Estate LLC (licensed in Idaho, Oregon, and Utah); Vacasa Real Estate LLC (licensed in Tennessee, 615-671-9916); Vacasa Real Estate LLC (licensed in Texas, Debra Brock, Designated Broker); Vacasa Real Estate LLC (licensed in Washington, Robert Brush, Designated Broker); Vacasa South Carolina LLC; Vacasa Tennessee LLC; Vacasa Vacation Rentals of Hawaii LLC, 3350 Lower Honoapiilani Road, Suite 600, Lahaina, HI 96761; Vacasa Vacation Rentals of Montana LLC, Patrice Tompkins, Licensed Property Manager; Vacasa Virginia LLC; Vacasa Wisconsin LLC; Vacasa Wyoming LLC. In Canada, this advertisement is provided by Vacasa Canada ULC, CPBC lic. number 75826, 172 Asher Rd. V1X 3H6 Kelowna, BC.