As a vacation rental manager, I’ve always struggled with the question of how far in advance to book reservations. At first it was mainly an issue of taking the time to price out future dates, which was always cumbersome, but now that we use pricing software, that’s not as much of an issue because the pricing software automates it. We keep track of how far out each of our guests books and across thousands of reservations our current average is 26 nights. After a number of years of monitoring this number we’ve settled on accepting bookings no more than 6 months out for a number of reasons which may or may not work for you. Here, we’ll walk through the things you should consider in deciding how far out to allow your guests to book.
- The further in advance a reservation, the more likely a guest will cancel. It’s just a fact that given more time there are more things that can come up and cause problems with a reservation which may cause a guest to book and get a full refund.
- If you’re using a pricing engine (or even not) more often than not we find that further out dates tends to have lower rates which encourages longer stays for more popular periods. For us, July is hands down the most popular month in town and it’s a month we prefer not to have a long term guest because our July occupancy will always be extremely high at our highest nightly rates for the year.
- Seasonality and local events. In our town the largest civic event has their ticket sales about 6 months in advance of the event so we’ll see an influx of bookings at that time and we’re a lot less scared about being able to rent the unit should one of those reservations cancel.
- If you allow guests to book too far in advance you won’t be pricing dates with enough information to make your nightly rate optimal. By optimal we mean pricing at the highest possible rate while still being low enough to maintain a high enough occupancy to maximize your revenue. When pricing you should always consider seasonality, special events, overall occupancy for your area, and average rates for your area.
- If you have a little bit of patience more than one listing try testing two different time periods for how far in advance to allow bookings. Set one to 3 months and the other to 6 and then after 6 months reevaluate how they’re doing. When you do reevaluate though, do it based on year-over-year RevPAR, so you’re getting the most apples to apples comparison.
Even though we do 6 months, I recommend 3 months for most hosts in most areas because they don’t have some of the local particulars that we have. But before making your decision, consider all these factors and pick which works best for you and your locale.