In part 1 of this multi-step guide you learned how to conduct market research. Market research is an extremely important part of starting any business, because it will either confirm or reject the validity of a potential business opportunity. When it comes to getting started as an Airbnb host, market research will help you understand whether or not your location could be a hot spot for short-term rentals! If you haven’t conducted market research yet then I suggest you read that article by clicking here.

Part 2 is all about pricing. How much should you charge for your Airbnb rental per night? Pricing is going to vary based on a multitude of factors; but don’t worry, I’m going to help you identify those factors and apply my pricing methodologies to your listing. Let’s dive right in!

First things first…

Write down your listing’s basic attributes. These include location, number of guests allowed, and listing/room type. These are the first three factors that will determine the price point of your listing. If you are new to hosting then you will need to understand the different property/room types. I have explained that information below.

What is your listing’s property and room type?

Airbnb currently offers 27 different property types on their website ranging from traditional homes and apartments to more obscure styles like caves and tipis. Once you select your property type you will be required to designate a room type. Airbnb currently offers 3 different room types. These are entire home/apt, private room, and shared room. Your property type and room type combination will affect your listing’s price point.

The pricing tier on room types, from highest to lowest, is generally entire home/apt, private room, and shared room. You will be able to charge more to rent out your entire home/apt vs a private room or shared room. Obviously there are other factors that can affect this like location, size, amenities provided, etc. We will discuss those later in the article.

Find the average price of similar rentals in your area.

Let’s begin by researching what other hosts are charging in your area for similar properties. Start by going to and fill out the property search bar near the top of the page. Enter the location of your rental property and the maximum number of guests you can host. Leave the check in/check out dates blank as it will ensure that we’re able to view listings that might be booked during specific dates. Click “Search” once you have filled out the form.


On the next page you will see a map of your area and all available listings. This list includes all room types, so we will need to create a filter to specify the style of room that you’re offering. Click on your room type underneath the date range at the top of the page. Clicking one of these options will decrease the number of available listings and only show rentals that match your room type.

Underneath the room type selection area you will see a row named price range. Airbnb will indicate what the average price is per night for rentals that match your specified criteria. This is the first indicator on how much you can potentially charge per night for your rental.

airbnb pricing tips

I would suggest clicking on the “Filters” button below the price range row to further target listings that match your rental. Any time you select a different option the average price per night will change. For instance, if you click on pool then the average price is likely to increase. In our area, the average price per night for apartments is actually greater than the average price per night for homes. This is possibly due to the fact that apartments might have a closer proximity to the ocean than most houses.

What are successful Airbnb hosts in your area charging?

It is important to remember that your rental is only worth what someone is willing to pay. While the average rental in your area might by listed at $62 per night, that doesn’t mean you should price your listing at that amount. In my opinion it is far more advantageous to mimic the pricing of a successful Airbnb host vs the average pricing in your area. How can you tell which hosts are successful? By counting reviews. More reviews equals more money!

Navigate back to the search results page on and only use the basic filters (location, guests, room type). Scroll down to available listings and look for hosts that have a lot of reviews… preferably more than 20. Write down the price per night of every host with more than 20 reviews, and do this for 2 pages of listings. Now compute the average price of these listings, along with the lowest price and the highest. Remember, these are successful Airbnb hosts… pay close attention to what they’re doing as it clearly works!

airbnb reviews

In my area the average private room is $66 per night. The average private room for “successful” hosts is $53 per night, a $13 decrease. The lowest amount charged per night for successful hosts in my area is $26, while the highest amount charged is $104. I think it’s interesting to know that on average, successful hosts in my area charge less per night than what the “average” host charges.

When less is more.

My wife and I currently charge $39 per night for our private room rental. Although the average private room rental in our area is listed at $66, we believe that charging a lower price has attributed to much of our success.

For starters, it’s a steal of a deal. Our nightly rate is almost half of what the average Airbnb private room rental costs and 1/4 of what a local hotel costs. This pricing strategy has kept our rental booked solid since creating the listing on Airbnb. We rarely have a night off.

It’s also helped keep our reviews high. We have received 5 star reviews 96% of the time and have an overall rating of 4.8 out of 5 stars. The price of our rental lowers guest expectations and allows us to WOW them once they arrive. This helps increase our rental’s value rating.

Don’t go too low…

Remember that you’re providing a very valuable service to travelers, and that your work should be compensated accordingly. My wife and I chose $39 per night because at that rate we are able to pay our mortgage solely off revenue generated through Airbnb. Would we go lower? It would be hard to justify dropping our price any lower, as traditional alternatives charge $119 per night. We believe that what we’re offering is the best deal around, so no, we wouldn’t drop our price any lower.

airbnb pricing tips

We have also been informed by several guests that they were hesitant about booking our Airbnb rental due to the low price. They felt that it could potentially be a scam, and only proceeded with the booking because how many great reviews we have received. This is definitely something to keep in mind when setting your price, especially if following a low price strategy.

Use the low price strategy if you’re a new host.

We definitely suggest using the low price strategy if you’re new to hosting on Airbnb. Guests will be weary about booking a reservation that has little or no reviews, so creating an incentive by charging less is probably your best bet to getting reservation requests. You can increase your price after receiving 5 positive reviews.

Other important factors to consider!

As I said in the beginning of this article, there are many factors to consider when setting the price point of your listing. Below are some of the other factors that can negatively or positively affect your pricing:

  • Location
  • Rental Size
  • Amenities
  • Decor
  • Unique Features

You should adjust your price point in accordance to what you’re offering guests. A penthouse suite with full amenities near the beach should be priced higher than a neighborhood home offering few amenities. You can get a better understanding of what to charge by surveying competitor listings in your area.

Some hosts also use variable pricing, an automated feature that will adjust your price point depending on demand. While this can be effective in a seasonal location, I would suggest using fixed pricing until you’ve gotten your rental off the ground.

I will be covering cleaning fees in Part 3 of this series. Stay tuned!

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